ChangeTip, an internet app which has facilitated tips over the web via bitcoin for two years, wanted to make it worthwhile for internet users of all varieties to produce quality internet content. “We had a vision for a company that would allow people to spread appreciation on the web for things they enjoyed,” says ChangeTip CEO Nick Sullivan. Now, the experiment is over, and at the end of November ChangeTip will have processed its last bitcoin tip. One of the most recognizable brands in Bitcoin couldn’t find a buyer. Read More
IRS has targeted the transaction records of Coinbase users in a case brought forth in the U.S. District Court, Northern District of California, as ZeroHedge tweeted late November 17.
IRS is targeting transaction records of Coinbase users: case is 16-cv-06658, U.S. District Court, Northern District of California
— zerohedge (@zerohedge) November 17, 2016
The John Doe summons (a summons issued to a person whose name is unknown at the time of service) , relates to numerous persons who might “failed to comply with provisions of the internal revenue laws.” The summons acknowledges that the identity of the persons whose information has been summoned is “not readily available from sources other than Coinbase.”
The summons seeks information “regarding United States persons who, at any time during the period of January 1, 2013 through December 31, 2015 conducted transactions in a convertible digital currency as defined in IRS Notice 2014-2021.” It’s a testament to how Bitcoin businesses can serve as a valuable point-of-information for the Bitcoin digital currency created in 2008 by the pseudonymous Satoshi Nakamoto.
The US Internal Revenue Service inspector general (IG) warned that the agency needs to overhaul its strategy for bitcoin and other digital currencies.
A report laments how US tax officials have failed to create a cohesive strategy to tax Bitcoin as property in the two-and-a-half years since it decided to do so. The report cites Bitcoin’s lack of control for third-party tools to report transactions.
The IG stated:
“The IRS needs to ensure that it develops a strategic plan that includes management oversight as well as adequate internal controls for its virtual currency programs. Until a comprehensive virtual currency strategy is developed, the IRS is open to the risk that undetected noncompliance of virtual currency taxable transactions will result in an increase to the Tax Gap.”
“Due to the potential complexity of reporting otherwise simple retail purchase transactions related to virtual currencies, further guidance is needed to help taxpayers voluntarily comply with their tax obligations,” the IG said.
The case has been assigned to Magistrate Judge Jacqueline Scott Corley, who presides over civil cases and has served as a settlement judge in nearly every type of federal litigation. Prior to her 2011 appointment to Court, Judge Corley was a partner at Kerr & Wagstaffe, LLP in San Francisco specializing in federal practice where she served many types of clients including government entities.
Since Coinbase did not add other crypto-currencies, such as Ethereum and Litecoin, until 2016, the IRS summons will pertain specifically to Bitcoin users.
“Well, free electricity is free electricity,” says Reddit user 3xist. “I was mining before at home but decided to scale up a little with some power that I didn’t pay for. My roommate did mind, but he was a very considerate guy and didn’t complain – it was taken as my ‘one shitty roommate thing’ in exchange for his equal roommate flaws. There’s no real way to hide the fact that you’re mining in a dorm room, my RA knew (didn’t care), everyone on my floor knew (thought it was vaguely interesting), etc..” Read More
Sporting jeans, a cool white shirt and a smooth-looking coat, once-embattled former Robocoin CEO, and current Romit CEO, Jordan Kelley recently gave a compelling pitch, in which he claims his machines did $150 million (trust us guys!).
In 2014, a post appeared on Reddit claiming owed $25,000. From there, the company quickly disintegrated and individuals who had purchased machines were left to reformulate them. That led to multiple Bitcoin ATM companies, like Lamassu, attempting to salvage the bricks with their own software.
Robocoin, based in Las Vegas, dominated the Bitcoin ATM market in early years. Although Kelley has claimed to be the first Bitcoin ATM on many occasions, the truth is otherwise: A man named Todd Bethel actually posted about the concept and pursued the project, and even had a working prototype, as well.
Kelley’s new firm attempts to tackle the seven trillion payments market.
In a pitch for his new startup, Kelley stated: We’ve got an interesting team. A very interesting one. One that has a fair amount of understanding of the world of fraud.
Read a transcript of Kelley’s pitch below:
Romit is a payment platform that eliminates fraud and chargebacks for the 7 trillion dollar million merchant banking industry
We launched five months ago and have already processed 280,000 transactions. We are doing that at a delightful growth of 52% month over month. We are also earning 400 basis points per transaction in net revenue which is 4x industry average and we have over 3.5 billion worth of volume currently onboarding onto our platform. The merchant banking industry processes more than 7t worth of credit card transactions on an annual basis. These merchant banks acquire their merchants with sales, these sales organizations you’ve heard of two of them at least, Paypal and Stripe, currently command 5% of total market volume. The other 95% are woefully underrepresented, woefully.
They lack high tech which results in high chargebacks and fraud, the good news is that romit has developed an incredibly modern and beautiful payment platform. We solved the biggest problems…the merchants were averaging 1.2% chargebacks, we got that down to to .0079% charge backs on a monthly basis after they onboard on our platform. That’s a big deal. A really big deal.
We’ve got an interesting team. A very interesting one. One that has a fair amount of understanding of the world of fraud. We invented the world’s first ATM we processed over 150$ dollar across 14 currencies in 19 languages without ever one time being compromised in the financial technology industry highest risk category.
“It seems to me that simple altruism can suffice to keep the > network running properly.” – Satoshi Nakamoto
This section gets a bit technical. Few truly understand how bitcoin functions, but by coming into contact, if even briefly, with the degrees of technology that go into powering a p2p network like bitcoin, one can have their mind expanded. To paraphrase Karl Marx, “the masses must live through the revolution in order to understand the revolution.”
“Preliminary research” suggests that bitcoin is an autonomous thing. In other words, the bitcoin open-source community acts as one united soul – an institutional-entrepreneur – in which countless actions of individual agents converge over time to create the bitcoin hologram. The collective and not the individual, nor a single organization, resolve the future of bitcoin. But, this collective is comprised of diverse individuals: of communists, of libertarians, of anarchists, of speculators and of the a-political. What inspired these individuals to create this community? Bitcoin.
Bitcoins are computer files, so they behave similarly to a music or a text file, and can be destroyed or lost like any computer file. Many say bitcoin is digital cash. To be sure, bitcoin is not exactly like physical cash. When you lose cash, someone else can theoretically find it.
If you lose bitcoins, they are not readily available to another person unless you were hacked. Lost bitcoins are not just found in cyberspace by web-surfers. Also, your brain does not store a trail as to where your cash was last. If a $100 bill falls out of your pocket, you might not have access to any data whatsoever as to what-in-the-world happened. Potentially, when you lose bitcoins, a computer security expert can do research into the issue.
As Trace Mayer puts it, “Bitcoin is like a gold coin that you can e-mail.” As we’ve covered, the central aspect of bitcoin is that it is an open-source software and community, and open-source communities are strangers, from anywhere in the world with Internet access, coming together and self-organizing around a shared interest so as to create value through sharing knowledge and innovation.
Undoubtedly, the community has not been able to tame the tide of misconceptions about bitcoin. Such as that bitcoin’s are backed by nothing. Therefore, bitcoin is not a virtual gold. But, the value of gold is largely reflected in the amount of energy consumed in mining and refining the metal, which contributes just as much to gold’s value as does its suitability as money. As one individual once put it, “a gold coin represents a large amount of land, highly refined, with the input of a great deal of energy, labor and capital.”
In a similar manner, bitcoins represent the computing power, energy and capital required to create them. It takes specialized technology running for sometimes many days to create a bitcoin. This was even true many years ago. Like mining for precious metals, it is not easy to mine bitcoins profitably. Bitcoin mining is extremely competitive, as we will detail later, and it’s rarely a profitable venture unless higher future prices in bitcoin are assumed. A main advantage of bitcoin is its peer-to-peer nature. This means there is no “issuing authority” for bitcoin, no central depository or central bank.
Newbies to bitcoin have asked on the Bitcoin Forum, BitcoinTalk, “What if someone tries to buy up all of the bitcoins?”
It is essentially impossible to buy all the bitcoins in existence. As they were purchased, the price of the bitcoins would rise exponentially. As Erik Vorhees asked a Newbie in the Bitcoin Talk Forum: “Imagine how much this mysterious buyer would need to pay for the last bitcoin still available? Who would sell it, and at what price? If there were only a few coins left, the price would be several millions of dollars, and people would simply use the fractions of a coin in the same they today use a full coin.” Some analysts, like former StockHouse CEO and current CEO of TDV Media, Jeff Berwick, have said that bitcoin will not be purchasable in US dollars within five years, citing the current crisis of confidence in the US dollar.
The resources that would be poured into bitcoin would be immense, posits Vorhees. He contends: “I can think of nothing that would accelerate the strength, power, and development of bitcoin more than ‘someone trying to buy all the coins.’
The dark web, having gained a reputation for offering illicit goods and narcotics, caught the attention of authorities after the Silk Road fueled much early Bitcoin price activity. Law enforcement’s subsequent focus on the dark web continues to this day. “We are well aware of these websites” authorities in Australia said in September.
In the US, the Department of Justice announced charges October 6 against Michael Richo, 34, of Wallingford, Connecticut on a criminal complaint charging him with access device fraud, computer fraud, wire fraud, identity theft and money laundering offenses tied to his phishing to steal bitcoins.
Deirdre M. Daly, United States Attorney for the District of Connecticut, and Patricia M. Ferrick, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation filed the complaint, which alleges Richo partook in an online phishing scheme to steal bitcoins from people on the dark web, where the crypto-currency is often accepted as a payment means.
Richo allegedly posted fraudulent links to online marketplaces on dark web forums. Users were brought to a fake login page made to look like the proper login page for online marketplaces. Richo then stole usernames and passwords and monitored people’s bitcoin balances on the darkweb marketplace they had intended to log into. When bitcoins were deposited, Richo withdrew them and sent them to his own bitcoin wallet.
Richo saved more than 10,000 usernames and passwords on his computer. Richo appeared before U.S. Magistrate Judge Sarah A.L. Merriam in New Haven. He was released on a $100,000 bond.
Richo faces 20 years in prison for money laundering, another 20 years for wire fraud, 10 years for access device fraud, five years for computer fraud and two years for each identity theft.
Bitcoin has been called money in other court cases, such as the court case of Trendon Shavers, in which the defendant was accused of running bitcoin’s first major ponzi scheme.
See complaint here.
While it is true that countries are likely to impose “harsh taxes and capital controls,” if recent trends in financial regulation are a clue, there are some key misunderstandings of the nature of the world wide web and Bitcoin in the above-quoted Time article. Anonymity – indeed, even pseudonymity – through either medium, the internet or Bitcoin, is a difficult state to achieve.
This misunderstanding is understandable. Bitcoin and other so-called crypto-assets (while crypto-currency is a term commonly used, many of these coins actually exhibit the characteristics of a financial asset, not currency) are a brand new advent. The internet itself has been around now in our collective conscious for just over twenty years, and it still remains a mystery to many people.
When we look back on what humans thought about the internet when it first popped into the collective conscious as a real thing in the nineteenth century, we twenty-first century “digital natives,” get a kick out of their understanding (read: misunderstanding) of the world wide web. More on that later.
The burning question remained for nearly everyone who had been involved with Bitcoin prior to its big break, landing on mainstream media seemingly in regular rotation like a payola scheme. But on mainstream sources this burning question was scantily asked. Instead, themainstream reported that Bitcoin was strictly digital currency, and thus should be regulated as such. Never once asking the big question in an honest scope:
A New Age For Money
Bitcoin challenges not only the way the globalized world does business in the twenty-first century, but also certain assumptions about money altogether. Sure, Bitcoin might not last forever, but Bitcoin has already changed the future by changing the present. This transformation started long before Bitcoin went mainstream in the spring of 2013.
Few were expecting a supposedly one
There are, to be sure, considerable advantages of digital money over traditional, paper-based fiat currencies become obvious upon first use of Bitcoin.
Yet another benefit of Bitcoin is its proclivity to lead users to become more aware of internet privacy and computer security, exposing some individuals to software they would not otherwise experience. A digital currency regime at the national level would increase users’ daily interaction with software systems, perhaps improving the skills and knowledge of users regarding personal finance software and finance optimization technology, as well as computer and Internet science generally.
Those nations which promote the use of decentralized digital currencies could earn a competitive advantage at the international level when it comes to computer literacy. Because of technologies like Bitcoin, computer literacy is more important than ever.
Is Bitcoin the new Cayman Islands or a better memory? In a way, both. Hip-hop and punk rock audiences mention often that these styles are not music genres, they are lifestyles. Bitcoin can be seen the same way. It’s not just a money, it’s not just a technology, it’s more a way of life. A worldview, but more fluid. A philosophy. It is an open-source software community, and many of its participants are open about their work, not trying to hide illicit activities. Bitcoin is also a better memory. Thus, Bitcoin is both a new sort of paradise and a better brain.
Expect unimaginable technologies to come from the same school of thought that brought the world Bitcoin. I hope that, within these pages, a clear understanding of Bitcoin basics can be achieved, as well as a broad look at the changes to human life its technology could foster. Many of which already exist.
Although following in the footsteps of past forms of private money, Bitcoin is wholly different, for, not only is it digital, but also the technology is decentralized.
Commercial banks have indeed looked into creating their own virtual currencies. According to Kirk Hope, the chief executive officer of the New Zealand Banker’s Association, some commercial banks wish to compete with bitcoin. “If it’s not bitcoin it might be some other type of digital currency that could come into play,” Hope said. The currency still faces problems around legitimacy, Hope said. “They are being used to buy things like arms and drugs,” he said. “I suspect tax isn’t being paid on bitcoin transactions.” (11)
All-in-all, Hope demonstrates an acute lack of understanding about bitcoin. For instance, he cites that there can only be 21 million bitcoins in existence as a rationale to argue in favor of bitcoin having shortcomings. But, that “satoshies” can be spent (up to the eighth decimal place) make bitcoin a potentially very robust exchange unit. He says, “you wouldn’t want to pay $300” for a cup of coffee, as if he doesn’t understand that a bitcoin can be subdivided at all.
There are many ways in which bitcoin could be adopted by the more mainstream banking institutions. Products and services are brought into the payment space all the time. Bitcoin is two products: both the exchange unit and the processing mechanism. This might be intimidating for a company like MasterCard, Visa and banks. What they will have to understand that, for many users, bitcoin’s decentralized nature is one of its primary benefits. Certainly, 2013 was the year in which everyone from bankers to regulators began to come to terms with the existence of something like bitcoin. 2014 will likely be the year of bitcoin education.
Late in 2013, JPMorgan attempted to renew a patent they first filed in 1999. It was reported the bank was designing its own digital currency for use with digital “wallets.” The patent itself related to a “method and system for processing Internet payments using the electronic funds transfer network.” Although the patent application was lengthy, it did not mention bitcoin, although it did hint that “new Internet payment mechanisms have been rapidly emerging.” (12)
Quickly, however, it was reported that JP Morgan’s patent application had been rejected 175 times. JP Morgan filed the original patent application on August 5, 2013 for an electronic mobile payment system. By October 18, 2013, all claims had been rejected. (13) By the time of JP Morgan’s patent filing, bitcoin had been in the public eye for a couple years.
Since then, bitcoin has shown tremendous growth, and individuals can now buy many online and offline services (Internet, professional, travel services) and digital and physical goods (clothing, accessories, electronics, books) with the decentralized currency. Divisible to eight decimal places, bitcoins can be used for micro-payments, and some employers are now offering to pay employees in bitcoin. Bitcoin can be exchanged for over thirty traditional fiat currencies. (i.e., EUR, USD, CAD, GBP, PLN, JPY, HKD, SEK, AUD, CHF).
The Arcade City app, featured in numerous headlines in 2016 as an alternative to Uber and Lyft, has been released. Residents of Austin, Texas, where other ridesharing services have been banned, have another option in Arcade City to get around.
In order for drivers to use the Arcade City app in Austin and other cities, one million Karma points must be accrued by doing things like donating food to the needy. To keep track, this is done through Unsung.org, an app aimed at ending hunger. Austin was the first city to accomplish this, reaching its karma point threshold September 17.
Participants there, who refer to themselves as “the people of Arcade City, Austin” and “Members and Citizens” of Arcade City, started drafting a constitution. All groups must create their own constitution which describes how the group operates.
The group finished earlier in the week with their Constitution, but went back to work on it after Arcade City founder and CEO Christopher David – who is referred to as Mayor of Arcade City – rejected it. He cited that it asked him to appoint leaders, which he won’t do. Later in the week, the group, located mainly in the Arcade City Austin Facebook group, finalized their constitution.
Arcade City allows drivers to set their own rates, contract directly with riders, and build their own recurring customer base over which Arcade City has no oversight by simply not really providing any of the infrastructure to handle it, as the recently released app demonstrates.
Arcade City is not much more than a virtual gathering place or the Craig’s List of ridesharing combining bitcoin with Facebook’s pre-existing infrastructures. It’s trying a radical new model so that it does not fit within the purview of regulations which brought down Uber and Lyft in Austin. Yet, the city has taken notice.
I reported in Motherboard in June that the Austin Transportation Department sent six officers to Capital Factory, a tech-focused co-working space where Arcade City addresses its headquarters, in order to serve David a ticket. A few days after, ATD sent David what he called a “nice email” requesting a sit down meeting to discuss the transportation ordinance.
David spoke with officials for approximately an hour and explained why he believed Arcade City is not a transportation network company, the business model used by Uber and Lyft to connect paying passengers with drivers who provide their own transportation.
“They didn’t fully agree with my reasoning,” he told Motherboard. So, it’s not clear if ATD will let the model persist. In June, Austin police impounded a female Arcade City driver’s vehicle for violating local transportation regulations. In a test of a central tenet of Arcade City’s model—community—other Arcade City drivers reportedly band together and crowdsourced the funds to get her back on the road.
“Arcade City the corporation has laid out an ambitious vision of total decentralization over time, a vision that will take resources and solid corporate strategy to attain,” David said. “We have a corporate interest in ensuring that people representing our brand in new cities aren’t making stupid mistakes that give customers a poor impression of Arcade City, mistakes that could have been avoided if they’d been connected with experienced drivers in our network.”
David believes ridesharing apps like Uber and Lyft “bastardized” the sharing economy. “They manage their drivers centrally, tightly control rider/driver interactions, and don’t allow service providers the leeway to set their own pricing or terms of service,” he said. “Their model is transitional: it fills the gap between the legacy transportation services of the past and the decentralized, stakeholder-owned marketplaces of the future.” But, David said, the modern ridesharing model will soon be obsolete.
“The value of that peer-to-peer, community-centric network will be orders of magnitude higher,” David said.
The Pirate Party, which promises asylum to Edward Snowden and accepts Bitcoin, could form the next Icelandic government.
The Pirate Party is symptomatic of great distrust in the traditional political system gripping Europe. Drug decriminalization and promises of economic improvement have inspired people skeptical of corruption.
Iceland’s Parliamentary election takes place October 29.
“Across Europe … increasingly many people think that the system that is supposed to look after them is not doing it anymore,” Pirate leader Birgitta Jonsdottir, who is also a published poet, told Reuters.
He added: “We know that we are new to this and it is important that we are extra careful and extra critical on ourselves to not take too much on. I really don’t think that we are going to make a lot of ripples in the economy in the first term.” The party says it won’t do things too dramatic.
“We will not be doing any dramatic things in this regard, we will carry on with the lifting of capital control. We are not going to make any dramatic changes in the financial sector,” said Jonsdottir.
Kim Dotcom’s pinned tweet reads: “I never lived there, I never traveled there, I had no company there, but all I worked for now belongs to the USA.”
A dedicated Twitter user and political activist, Dotcom’s tweets revolve around the US’s copyright infringement case against him, his businesses, Bitcoin, and, recently, a new Kiwi law interpreted by many as giving government more powers to spy on its citizens.
Tweets about his ongoing legal battles are especially telling. A federal appeals court ruled last Friday the U.S. government was justified in its seizure of millions in assets from Dotcom.
Further, the Megaupload founder has no problem tweeting his thoughts about his judge: “Because Judge O’Grady was a partner at Disney’s favorite law firm. It’s now paying off for the US copyright elite.”
While fighting the Department of Justice, the German born mogul simultaneously courts the anarcho-capitalist and libertarian “Bitcoin community.”
“The #Bitcoin community seems excited about Bitcache,” he tweeted about a recent project to blend Bitcoin and Megaupload.
Dotcom and BankToTheFuture, a self-described “online investment platform that brings financial innovation & technology investment opportunities to qualifying investors” with particular attention to compliance, are working on an investment opportunity for qualifying investors in Dotcom’s newest venture, BitCache.
“Coming this August,” Dotcom tweeted.
The investment opportunity was hatched when financial journalist Max Keiser introduced Dotcom and BnkToTheFuture CEO Simon Dixon.
“This type of financing deal is only possible today due to the fact that the legal environment for storing encrypted files has come much further, the world’s first peer to peer decentralised currency Bitcoin has become the largest in the world,” Dixon told Bitcoin Magazine. BnkToTheFuture allows qualifying investors to pool their funds together to make investments in companies involved in building “the future of finance.”
Dixon says BnkToTheFuture has been involved in investing nearly $70m in companies over the past year. Keiser, a BnkToTheFuture client, suggested a deal between Dotcom and Dixon as soon as Dotcom announced he’d incorporate Bitcoin in Mega Upload 2.0.
Mr. Dotcom seems determined to combine bitcoin and cloud storage. The 2017 reboot of Megaupload – the first version of which was seized in 2012 by the US government – pairs with Mr. Dotcom’s vague blockchain project, Bitcache.
Mr. Dotcom, who founded Megaupload in 2005, foresees a mass online storage solution, with Bitcache using bitcoin to power micropayments. Dotcom also claims he will solve Bitcoin’s blockchain scaling problems. Encryption will secure user privacy.
Dotcom’s three ongoing projects pair: BitCache, Megaupload 2.0, and MegaNET. BitCache, Mr. Dotcom claims, could solve the Bitcoin block size debate.
“Bitcoin is currently involved in a debate on how to scale the number of Bitcoin transactions that can be processed each second and new technology is being developed to make that scaling happen on the Bitcoin protocol level,” Dixon said. “Kim identified a problem that he needed to solve in order to scale Mega Upload 2.0 to the number of transactions he needs to meet his business needs.”
Towards that end for Mega Upload 2.0 and other customers who need larger Bitcoin transaction volumes than currently possible, Dotcom is building Bitcache.
Mr. Dotcom plans on Megaupload 2.0 to deliver the “instant critical mass” MegaNet needs from a robust user base. Megaupload 2.0 Platform will enable Bitcoin micropayments via BitCache, allowing users to white-label their own applications.
MegaNET is designed to become a decentralized internet via mesh networks and the unused processing power and storage in cell phones. BitCache and Megaupload 2.0 are designed to bring processing power to the MegaNET system.
Dotcom says the project will be open sourced. Known currently? Not much. Yet Dotcom promises to bring Bitcoin to the masses: “I know how to create tech with mass appeal. I’ve done it for 20 years. #Bitcache will take #Bitcoin to the masses.”
— Kim Dotcom (@KimDotcom) August 9, 2016
Full details won’t be available until the pitch is launched on BnkToTheFuture. That Mega Upload enjoyed a userbase of millions underpins much of the planning for Megaupload 2.0.
“If successful this project can be instrumental in bringing new user cases to Bitcoin from large scale enterprise users potentially bringing millions of first time users to Bitcoin in a way that is more user friendly,” Dixon said. Dixon believes Bitcache could allow Bitcoin to scale to a volume akin to Visa and Mastercard without the need to change the code, as suggested by others.
What’s the big picture? According to Dotcom, his masterpiece:
“I’m creating a perfectly legal privacy masterpiece,” he tweeted. “I can’t wait to show you. Trust me when I say “You won’t need anything else.’”
The largest corporations in the world are investing in blockchain technology, and longtime blockchain proponent Stefan Thomas warned about a potential future dystopia.
Ripple Labs FundingStefan Thomas, Chief Technology Officer at Ripple Labs, private and public ledger company, highlighted in an essay titled “The Subtle Tyranny of Blockchain” what he views as shortcomings in the exploration of blockchain technology and his opinion that, in the very near future, a blockchain tyranny could befall the world.
Read More here.
Bitcoin Belle, who goes by “DI$RUPTIV3” on Twitter, hates the media and compares Bitcoiners to “lost boys” in need of mothering. That’s what she told me when the website reached out to her for comment on the Craig Steven Wright affair, the Australian man who recently claimed to be Satoshi Nakamoto, founder of Bitcoin. Belle had been following the developments closely, tweeting about them regularly in well-received tweets, so we reached out, in earnest, for her comment. Here’s what she volunteered.
Belle, who courts Bitcoin payments for herself on Twitter, says on her Twitter profile: “If you like it, you should put a Bitcoin on it.
Her location, according to the social media site, is “World of No.” Perhaps I should have anticipated a “no” when we reached out to talk to Belle about her Bitcoin opinions! Well, her opinions are what we got.
She told us she hates the media! She chastised me for not knowing this. (How could I have not known every detail about this Belle’s life?)
When I asked out to chat with her, she fired back over Twitter: “Why are you interested in my views? And have you not seen how much I hate the media.”
Busy with our own lives, instead of following hers, no – I did not know. She also had unfavorable things to say about the Bitcoin Community
“I am like a den mother to a group of Lost Boys,” referring to the Bitcoin community. “I would agree there are many who need mothering.”
Belle, who also goes by Michele Seven, added: “I do not give my permission for this or any part of it to be used or shared beyond this DM exchange.”
Since Bitcoin prides itself on transparency, I thought that the community should know how one of their “Belle’s” thinks of them.
A slave to the controversial, she added: “Fuck off.”
Belle, who tends her own garden, once tweeted: “The best course of action is to abolish the state.” Of course, she’s never laid out a plan for action.
Mr Robot, a psychological thriller, is an experimental, new type of television show. For instance, fans were able to see the premiere of the show on social media the night before it premiered after the show’s creators “leaked” it online. The show follows a young programmer who works as a cyber-security engineer by day and vigilante hacker by night. Read More
GoldSilverBitcoin is a site for people who love money. That means our readers are moneyed and successful. They like to look their best, and enjoy their lives above and beyond the concerns of society and the poor. For them, we’ve put together this list of luxury products they can use to enjoy their decorated lives. Read More
The Redditor, who recounted his story in the Bitcoin Reddit r/BitcoinMarkets, dedicated to price analysis of the crypto-currency, was due to fly home across the Pacific when he decided to really go on a trip. Not wanting to smuggle drugs through the airport, nor wanting to through away the strog LSD tabs he had procured while on vacation, he ate them before going through security, “figuring it would kick in pretty nicely in time for the flight. It did.” Read More
Coinbase announced changes to its Merchant Tools, such as partial refunds. Coinbase Merchant Tools currently boasts 43,000 merchants. The company has asked its top merchants and customer support teams how to improve the Coinbase Merchant experience. The company also now uses Insight as its BlockExplorer.
“With more reliable transaction confirmations, we’re improving the experience for merchants, their customers, and Coinbase support,” the company wrote in its blog.
The company has determined overpayments a problematic aspect of Bitcoin. “Mispayments has been our number one requested merchant feature for some time.”
The Bitcoin wallet and exchange added:”Our legacy system…made it a little too easy to create a mispayment.”
To solve the problem, Coinbase has introduced “Overpayments.” The company explained: “In our legacy system, we frequently saw customers accidentally overpaying for their order, whether due to transaction ‘miner’ fees being unnecessarily added, or due to errant keystrokes.” In addition, refunds for overpayments have been made easier.Coinbase, one of the original well-funded Bitcoin companies and based in San Francisco, has been a stalwart for the volatile Bitcoin space. The company maintains a regular blog, as well as openly shares usage statistics in the industry. Its Shift Payment debit card, furthermore, has been a certain boon in promoting Bitcoin adoption.Learn more about Coinbase here.
Markets have been reeling since news that Britain would leave the European Union. Britain represents the first country to leave the EU, and uncertainty about what’s to come has led investors into safe have assets, including gold, silver and Bitcoin.
While the Bitcoin price remains stable, amid what some are calling its big moment to shine, there does certainly seem to be correlation between global economic uncertainty and bitcoin’s price resurgences. Read More
The Securities and Exchange Commission has been keeping a close eye on blockchain technology.
Such crowd funded blockchains seemingly operated under a so-called “good deal exception,” in which investors, who are satisfied because they are making money, do not complain to authorities.
That didn’t stop the SEC from pondering how securities law might apply. Read More
Samsung, the largest South Korean corporation and headquartered in Samsung Town, Seoul, develops Bitcoin type technologies.
With International Business Machines Corp., Samsung Electronics Co. has big blockchains plans.
As Bloomberg writes:
While bitcoin’s price has almost halved in the past year and the prospects for the digital currency are uncertain, its underlying software is attracting companies like phone makers, carriers and banks. That’s because the technology can be tweaked to record changes in ownership of any asset in a public ledger using a distributed network of computers or mobile phones. It could help facilitate all types of online transactions.
Founded in April 2014 in Hong Kong, Bitspark strives to create an easy-to-use service to make Bitcoin transfers easier.
“Bitspark focuses on a few key areas,” Bitspark founder George Harrap told me. “Firstly, we will be building upon the exchange to enable a number of new features, UI updates, security enhancements and additional currencies. Part of what we have always been going for with the exchange is providing a trustworthy, transparent and full-featured trading experience without parallel- our Multisig reserves secured by Bitgo is a key ingredient in that.” Read More
Tennis is a very strong bitcoin betting sport at Nitrogen Sports. “The one-vs-one nature of big matches tends to interest bettors because it’s a great way to dive deep into the psyche of individual players,” he said. “We also foresee fantastic growth in eSports in the coming years, as leagues and teams improve their product for a mass audience.”
The second largest blockchain crowdsale of all time is Ethereum. Ethereum is a blockchain system based on smart contract technology which seeks to remove humans from the nature of contracts. It is run by a virtual machine, which is a distribution of computing power run in a Bitcoin-type network. Miners in this distributed network are rewarded in ether, a Bitcoin-inspired digital currency that Ethereum proponents refer to as the “fuel” of the network. This is similar to how Bitcoin miners are rewarded with Bitcoin.
Bitcoin has had a scandalous past already, with many high profile court cases. When you go to conferences, the focus is on how Bitcoin is world changing and the opportunity of a lifetime. In most discussion circles, and at most lectures, nobody will dare mention those people who have been arrested and charged with whatever crimes.
Some come to mind, such as LocalBitcoins trader Pascal Reid, Coin.mx trader Anthony Murgio and Trendon Shavers – the much-hated Pirateat40 – who was considered a villain in the Bitcoin community, but one of his lawyers have recently come out and told of a different Trendon.
So, here the Bitcoiners are, ignoring their own fates. Netki COO Dawn Carey Newton spoke at the Inside Bitcoins conference in San Diego in December where she mentioned federal agents told a digital currency conference that there were currently many pending investigations. Dawn guessed dozens were pending.
That means many more Bitcoiners are going to have charges brought up against them. That could be you. Might already be you. And just like what happened with other Bitcoiners before you, nobody will stand up to defend that you were merely helping the Bitcoin ecosystem to grow and never thought you were doing anything wrong. And the prosecutor won’t care either.
As lawyer Jason Seibert said at Inside Bitcoins, Bitcoin is “legal sexy.” What he means by that phrase is that hard-working law enforcement agents and prosecutors might wish to make a name for themselves in the field of crypto-currency legislation and policy.
Because of regulatory vagueness, a number of Bitcoin business models are at stake. Even if you’re once removed from any transacting of money, you could get caught up in a court case of a client as a witness. Even this will put you under great scrutiny.
If you’re one of those Bitcoin entrepreneurs who loves the Bitcoin community, and is doing whatever you can do to add new applications to the cryptocurrency space, then you might be at risk for a state or federal investigation. And when your time comes, you’ll just be another trending name on the top of r/Bitcoin. And, at the Bitcoin conferences, venture capitalists will just talk how innovative they’re being with their lawyers and booty of dollars.
The producer of Nirvana’s landmark record, In Utero, levied some interesting critiques of blockchain technology in an interview long before the technology had captured the attention of some of the world’s largest corporations in 2015.
In a discussion with the podcast Decentralize.FM, Mr Albini seemed suspicious of blockchain technology. The Shellac guitarist did not understand why, if an open source community like Bitcoin and blockchain were trying to change, if not get rid of, modern institutions, why they would try and mimic the institutions themselves?
“What most of the underground culture has been based on is not finding an alternative version of something in the mainstream culture, like in [the Bitcoin] example, finance, but making those things we find repellent about the mainstream culture irrelevant,” Albini told Tony Sakich of Decentralize.fm. “It’s not let’s have our own lawyers and contracts and our own automated version of bill collecting; let’s not have lawyers, let’s not have contracts, let’s not have bill collecting, and not let’s have our own version of exclusive relationships that we police, but let’s not have exclusive relationships and not have any police.”
He points out that Bitcoin is merely mimicking the ways things have always been: “Bitcoin is creating equivalents to items that exist in the material world but in the digital ether, and my point, and probably the fulcrum of my existence, has been to eliminate those things from my life, not create an alternative version I could cherish as my own invention.”Albini highlights how his personal philosophy differs from this. He leveled some interesting criticisms at smart contracts, and contracts in general, at the time.
“I’ve made contracts irrelevant and unnecessary in my life,” he said. “I don’t use contracts in business, I literally do not use them. I’ve had a successful and extended career based on the idea that I’m only dealing with people I can trust and who can trust me. I’ve never signed a piece of paper; never even had a verbal understanding of the details of our relationship…”
While Bitcoiners champion how blockchain technology means we can do away with trust in the modern world, Albini thinks some trust is a good thing.
“In the terrified straight world people say, ‘Well aren’t you afraid of someone taking advantage of you?’ Like someone books a bunch of studio time and then cancels it…Well that happens very rarely and it happens very rarely because we do a good job at vetting the people that we’re working with. We spend a little bit of energy making sure the people we’re dealing with are trustworthy, and building a personal relationship with them, then we don’t have to spend an extraordinary amount of time structuring agreements, and contracts and collecting on payments that people are reluctant to make.”
One year later, smart contracts have been adopted by Microsoft, IBM, and the world’s major banks. At conferences for blockchain technology, representatives of some of the world’s most influential corporations discuss how the blockchain can be applied to modern systems. They debate whether or not blockchain technology can streamline the criminal justice system, banking systems and even the Internal Revenue Service.
At a Blockchain Conference in 2015, some members spoke openly about their visions for blockchain technology.
Former Mechanics Bank CEO Christa Steele, Boardroom Consulting LLC, Founder & Managing Member, pondered how the Blockchain could be used for criminal justice.
“Why don’t we just overhaul the whole criminal justice system?” she said.
“[My husband is a police officer] and when he pulls someone over right now and they have a felony, there’s no way to figure out what type of felony,” she lamented. “I’d want to know that if I pull someone over. He pulls someone over there’s no way, so they have to check into five or six different systems to access the information. What if we were to tie all that information together? What would the worth in the scheme of things? Because then you [must] incorporate the whole criminal justice system as far as prosecution, going to jail and a whole slew of steps along the way.”
John Wolpert, product lead on IBM’s blockchain efforts, said at the same conference: “Compliance is a big issue we talk about on our team. A lot of people talk about regulation of blockchain. Most of the time they’re really thinking about [the regulation of something in banking we’re building on the blockchain].”
Wolpert continued: “You can instrument Dodd Frank on the blockchain. [And] you could instrument the tax code. I would love to never have to file taxes, any transaction is just ‘hashtag taxes,’ and it just [automates the process], and all the rules get written to the chain.”
Despite his caution, Albini still likes the Bitcoin technology: “I appreciate bitcoin as a technological innovation.”
Despite a strong year so far, gold was down for its first month in 2016 in May. While the fundamentals most goldbugs champion – uncertain economic conditions and central bank policy – remain, demand could fall as younger generations turn to a new type of gold – digital gold.
In particular, millennials have less interest in physical gold. This isn’t necessarily a value statement. They simple have less experience of it. They don’t recall the days when the US dollar were on a semi-gold standard.
Today, they are more interested in digital gold, and Bitcoin has long been marketed as digital gold. Many young people claim that, although it is relatively new, Bitcoin offers similar savings aspects as does gold. Many, however, claim that Bitcoin is merely speculative, and thus very risky.
There are many parallels between Bitcoin and gold. For instance, when he designed the digital currency, Satoshi Nakamoto incorporated a mining aspect, similar to how gold is mined, but for computers.
Many millennials working in the Bitcoin industry, furthermore, are hoping to put gold on a blockchain. Projects like BitGold, Digix and others highlight this.
Older generations have bought gold because of the absolute privacy it offers. One can buy physical bars, and store them in a closet where nobody knows. It’s more similar to cash under a mattress than a gold stock. It seems, millennials interested in versions of digital gold are okay with sacrificing a bit of privacy, although many proponents claim blockchain technologies like Bitcoin and others are private. Still, it’s hard too argue they can be more private than bullion.
According to a survey by Global Metal News, millennials (age 19-35) showed better knowledge about lithium than gold, underscoring young people’s fading interest in gold – they are more interested in lithium.
Lithium is having its own Gold Rush of sorts, with hedge fund managers, pension funds and young retail investors entering investing in the commodity. Lithium is important for ion batteries, needed in the devices becoming more common. Lithium is also important electric vehicles. One need not look further than Tesla’s $5 billion lithium-ion battery subsidiary. The idea is that Tesla is going to be consuming lots of Lithium.
Millennials and younger in the coming years will likely be more enticed by digital gold than they are by gold bullion. There has already been a major motion picture about Bitcoin, Dope, on which the popular musician Pharrell Williams was an executive producer. There is no such equivalent Hollywood film portraying the gold industry. What’s more, it’s currently cheaper to buy one bitcoin than it is to buy one ounce of gold.
On the popular social media website, Reddit, a Bitcoiner expressed his relationship to gold and Bitcoin: “I had both for a while, but the practical aspects of Bitcoin ended up disillusioning me on gold, I no longer believe in it strongly enough to hold it.” Others recounted similar experiences.
Goldbugs who were adamantly against Bitcoin have turned towards it. Peter Schiff, a leading gold advocate who appears regularly on mainstream media, being one. Andrew Hoffman of Miles Franklin, Andy Hoffman and Chris Duane have also warmed up to digital gold as gold prices cooled off following their enticing 2011 price increases.
“My first few investments were in gold bullions back in 2007/2008. My portfolio was ~90% metals at that time,” another Reditor related. :They now make up ~3% of my portfolio while crypto makes up about 75%.”
Amid an edit war in which Bitcoiners argue Ethereum’s DAO’s are crowdsales and another group argues they are in fact IPOs, the recent Ethereum product known as Decentralized Autonomous Organizations has raced to the top of the largest “crowd sales” of all time. Below is a list of all the blockchain related crowd sales ranked in order.
Shift card is one of best use cases for blockchain technology. When your friends say they don’t understand Bitcoin, just show them your Bitcoin debit card and that will go a long way towards their understanding of the revolutionary technology based on the blockchain.
Coinbase launched the first US Bitcoin debit card first in 24 states, allowing individuals to spend bitcoins online and offline at more than 38 million merchants globally. There are no fees on domestic transactions. Coinbase’s fee schedule is here.
Many people have opined that Bitcoin is not illegal, such as Chris Kitze. Their argument centers on how the digital currency does not comply with know your customer and anti-money laundering regulations.
But, it’s likely Bitcoin is easily regulatable. In general, it’s business, not the financial instruments themselves, that do the regulating. Incorporated businesses virtually sign documents stating that, if they come across individuals breaking laws, they will report them. This is particularly the case when it comes to the financial industry. Bitcoin companies are generally considered financial companies.
Reports flood the internet about Bitcoin related companies instituting stringent know your customer and anti-money laundering policies – the policies which ensure that people are not profiting from illegal fund moving or terrorist financing.
1 Coinbase – The San Francisco Based Coinbase is one of the top Bitcoin companies. It’s created a PayPal like Bitcoin exchange that is incredibly easy-to-use. You mom could figure it out. What’s more, in a partnership with Shift Payments, Coinbase created the Shift Card, which interfaces with your Coinbase account.
Bitwage – BitWage allows employers and employees to handle payroll in Bitcoin, local currency and even some commodities. BitWage released its Bitcoin payroll system in July 2014. CEO Jonathon Chester outlines to Forbes the business:
Argentine freelancers were waiting five days, giving up 40% of their income during that process, and some times their payments were simply lost in an opaque, slow moving system. Their only other alternative to losing 30% of their wage was getting on a boat to Uruguay to pick up their funds. Through us, Argentine freelancers were receiving wage payments from the U.S. or western Europe to Argentina in a day, at a cost of 1% of the amount, from the comfort of their home. After receiving their wages, the freelancers would figure out how to get their local currency on their own
In August 2015, BitWage processed more than $1 million in payroll transactions.
Purse – Purso.io markets its service to people looking to shop on Amazon. People can save as much as 25% on Amazon. Users looking for something on Amazon deposit Bitcoin onto Purse then share their Amazon wish list. Individuals looking to buy bitcoins then shop for you on Amazon. As soon as you receive the Amazon products, the bitcoins are released from escrow and the individual who purchased your goods receives his or her bitcoins.
Bitcoin ATMs – The Bitcoin ATM industry – led by players like Genesis, General Bytes and Lamassu – has quietly grown into one of the stalwarts of the digital currency space. Hundreds of locations throughout the world offer you the possibility to buy and sell bitcoins at a physical location. These machines can be found in liquor stores, high end retail locations and in the most popular centers in the US and Europe. With the vast majority of these machines in the US and Europe, they’re not quite the remittance-mediums people once hoped for, but the unbanked are being served by this market based on TDV research.
Local Bitcoins – LocalBitcoins bring buyers and sellers of bitcoin together. Looking to make some part-time money? Perhaps trading bitcoins on LocalBitcoins – within the purview of the law – could help pay the rent. The best use for LocalBitcoins is meeting up for a bitcoin/cash deal at a local coffee shop.
Ethereum – Ethereum has received a lot of press for its smart contract platform. Ethereum has become a key component of blockchain experimentation led by R3 CEV and the Linux Foundation/IBM. Many businesses, experts believe, could be built on top of the Ethereum model. The firm raised approximately $18 million in crowdsale giving it a distinct advantage over other “Bitcoin 2.0” projects.
Satoshi Dice – This popular betting game represents one of the first “blockchain-based betting” games. It’s been operating since 2012, offering off chain based bets since 2014. The service itself determines if wagers win or lose. The first operator of Satoshi Dice, Eric Vorhees, went on to found the popular ShapeShift.io.
ShapeShift – ShapeShift is one of the newest pieces of the digital currency ecosystem. It markets itself as the “Google Translate” of digital currencies. As the website boasts, “from start to finish you can change currencies in under ten seconds, no account required.” The website describes the process of transferring digital currency:
Select Bitcoin as the input and Litecoin as the output
Provide your Litecoin address in the box, then click the Start button
ShapeShift will generate a BTC deposit address for you. Please send your BTCs to this generated address. (Don’t send more than the Deposit Limit).
There are no emails nor passwords needed to use the site. That means no accounts. ShapeShift wants to become “the fastest, most private, and most convenient way to swap digital currencies, and the exchange rate will always remain competitive.”
ChangeTip – The San Francisco-based ChangeTip specializes in online micropayments which function as tips, most often for quality content. In 2015, the average micropayment was just over $1. The firm received financing after going viral. 10,000 tips in one day were executed. November 2014 saw a new community called “Millionaire Makers” whereby each ChangeTip user would donate $1 each.
Gyft – Gyft found an exciting and untouched niche in the Bitcoin space by offering popular gift cards for the digital currency. Gyft’s business turned into a Bitcoin-forward business seemingly overnight with the addition of Bitcoin payments. Over the course of the past two years, Gyft has experimented further with blockchain technology, and is close to implementing a decentralzed gift card exchange.
OpenBazaar – OpenBazaar has been a much anticipated addition to the blockchain space. The distributed e-commerce solution strives to replace websites like Amazon and eBay. What differentiates OB from eBay/Etsy and others is the concept of a moderator, which is a third party that oversees the transaction process. Moderators do not sell goods nor services. They also are not buying goods nor services. But, rather, they are providing value to the users of the network.
While eBay charges 10% for such services, OB’s moderators are option, and they choose their own rate. Many are currently offering for such services for just one percent.
1Broker – 1Broker enables its users to trade gold, silver, the DAX, Down Jones 30 Industrial (Dow 30), S&P 500 indices, Apple (AAPL), Facebook (FB), Google (GOOG), and Microsoft Corp (MSFT). Through a vehicle known as the Contract For Differences or CFD. CFDs are contracts between two parties in which the seller pays to the buyer the difference between the current value of an asset and its value at contract time.
1Broker’s CFD’s essentially function as derivatives for well-known financial markets. As the website founder once told me, “Our primary goal was to make trading as simple and transparent as possible.
The CFD instruments on 1Broker basically conncet Bitcoin with other global markets, enabling individuals to invest or speculate on 1Broker’s markets.
GoldSilverBitcoin – Entering into the gold business and starting your own gold dealing site is easier than ever. As goldbugs and silverbugs might notice, there is quite a bit of turnover in the online bullion retail scene. Moreover, the general websites that are highlighted are not the only ones. There are many, many online gold dealers who have carved out their own niche. The industry itself has gone through a lot of flux lately. We highlight in this article how you – Yes, YOU – can enter into the gold selling space. While we can’t go into certain technical details, this guide will make you aware of the tools you need. Here’s how.
There are numerous products precious metals oriented online retailers focus on, such as bullion gold, silver, platinum and palladium coins and bars, semi-numismatic gold and silver coins such as Morgan Dollars and Saint Gaudens (Pre-1993 gold coins), tube holders and survival gear. One thing many people, in my opinion, do not consider while opening a precious metals shop is jewelry. While precious metal coins oft carry small premiums – save for the Pre-1933 gold coins – jewelry has higher margins.
Former top welterweight contender in the Ultimate Fighting Championship,Mixed martial artist Jon Fitch, is currently training or a headline fight at the World Series of Fighting on Saturday.
Fitch, whose eyes were opened after the 2008 financial crisis, is paid in cryptocurrency.
“I was left under $180,000 on my condo in San Jose,” the fighter told Inverse magazine. “I didn’t want to keep supporting people who kind of make those things happen.”
The fighter is not completely paid through cryptocurrency. Nautiluscoin sponsored the fighter last June when he fought Dennis Hallman.
“I think I was the first mixed martial arts fighter who got paid strictly in bitcoin,” Fitch told Inverse. Fitch went on to detail why Bitcoin and MMA go together. MMA is an international sport, the fighter said, and in some places fighters have trouble getting paid.
“You fight in Brazil or somewhere else, and it takes a few weeks before you get your check,” he said. “It’s not always easy for a lot of fighters. They’ve got people to pay, trainers, expenses, and things like that.” The fighter likes keeping a diverse crypto-portfolio.
“I think it’s important not to put all your eggs in one basket,” he explained. “I like BitGold right now because you can hedge your assets a little bit.” He also likes HYPER and would like to see more secure wallets.
“Anything that makes it more usable, and different apps and things that can be decentralized,” he opines. “Anything that’ll decentralize, I like.”
During his tenure at the UFC, Fitch was a top contender for the Welterweight championship, receiving a title shot against UFC Welterweight champion, Georges St-Pierre, on August 9, 2008. Fitch was on the November 5, 2008 espide of MythBusters, “Coffin Punch.” The MythBuster wanted to know if someone could punch their way out of a coffin.
Fitch also made a cameo in the award-winning mixed martial arts documentary Fight Life sparring with Jake Shields.
Bitcoin has yet to recover from a flash crash which took place one week ago. Since that time, global markets have endured major volatility. Yet Bitcoin – which some Bitcoiners champion as a hedge against an empty global financial system – has trended down in the past week.
On August 18 around 5:00pm PST, a Bitcoin flash crash brought the price of the digital currency down to $162 from north of $250. The flash crash came amid much controversy regarding the block size debate. Michael Hearn and Gavin Andresen, Bitcoin programmers, have launched Bitcoin-XT, a new Bitcoin client, and wish to fork the Bitcoin community in favor of their client. While there have been criticisms, that the number of current Bitcoin transactions is programmatically limited makes such considerations importants. Here is a chart of the crash:
Bitcoin broke $162.
The price has bounced between $200-250.
In the wake of the flash crash, Bitcoin has shown enduring volatility to the downside. Institutions dealing in Bitcoin are likely taking a step back and re-assessing their positions until the Bitcoin block size debate settles decreasing demand. Bitcoin, now at $216, could trend lower. Global stock market volatility – with the DOW down 1,000 points – could bolster the case for Bitcoin, but Bitcoin does not seem to be in the right position to cater to such a market.
The Bitcoin price further decreased today upon news that Bitfinex shut down its order book. The Hong Kong exchange endured a flash crash last week and halted trading for seven hours this morning.
Zane Tackett, In a statement, Zane Tackett, Bitfinex’s director of community and product development, stated on Reddit:
“Earlier today, at 5:27 UTC, we encountered an issue with post-trade processing, upon which we decided to halt trading to ensure consistency in the order book.”
A common hypothesis submitted by members of the bitcoin community argues that the National Security Agency (NSA), or some other government alphabet agency, invented bitcoin. Many bitcoiners laugh this suggestion off as “impossible,” but, on the contrary, there is precedent for such an assertion. But, that doesn’t make it true…
It’s not as if the government or its agencies have never invented technology. In particular, the US defense industries, dubbed by Dwight D. Eisenhower as the “military-industrial complex.” Government research – generally conducted by the military or intelligence complexes and academia – has resulted in some of the most compelling technologies of our age, including the internet. The Tor project (the anonymous online network) was created by DARPA (Defense Advanced Research Projects Agency) and currently receives 80% of their funding from the US Government.
An NSA paper, written in 1996 and entitled “How To Make A Mint: The Cryptography of Anonymous Electronic Cash”, represents an interesting anecdote in the history of crypto-currencies and government agency. Here is the table of contents of the document:
1. WHAT IS ELECTRONIC CASH?
1.1 Electronic Payment
1.2 Security of Electronic Payments
1.3 Electronic Cash
1.4 Multiple Spending
2. A CRYPTOGRAPHIC DESCRIPTION
2.1 Public-Key Cryptographic Tools
2.2 A Simplified Electronic Cash Protocol
2.3 Untraceable Electronic Payments
2.4 A Basic Electronic Cash Protocol
3. PROPOSED OFF-LINE IMPLEMENTATIONS
3.1 Including Identifying Information
3.2 Authentication and Signature Techniques
3.3 Summary of Proposed Implementations
4. OPTIONAL FEATURES OF OFF-LINE CASH
4. 1 Transferability
5. SECURITY ISSUES
5.1 Multiple Spending Prevention
5.2 Wallet Observers
5.3 Security Failures
5.4 Restoring Traceability
The report does not exactly describe bitcoin, with key differences in the NSA researchers envisaging, in 1996, how a crypto-currency would work, and what bitcoin is today. It does accurately pinpoint the abuse such a medium of exchange could endure, and which bitcoin solves; that is, double-spending.
Tatsuaki Okamoto, one of the referenced authors at the bottom of this report by the NSA’s cryptology division, has been of particular interest to bitcoiners investigating what’s possibly the newest age-old question: “Who is Satoshi Nakamoto?” Many bitcoiners have highlighted that this person’s name is very similar to that of Satoshi Nakamoto, the alleged inventor of bitcoin. Mr. Okamoto wrote a paper entitled “An Efficient Divisible Electronic Cash Scheme“, leading many people to suggest that perhaps this individual is Satoshi Nakamoto indeed. By the time this paper had been written, the general consensus that an “electronic currency” would enable a user to withdraw these coins from a bank or other centralized institution. Even the above-mentioned NSA paper makes the same assumption. Obviously, this is not how Bitcoin functions. At this point a direct connection between Okamoto, the NSA and bitcoin eludes any diligent researcher. But circumstantial evidence remains. For instance, the Wikipedia page for Sha-1, of which sha-256 is a function (the hash function used by bitcoin), explains the hash functions origin:
In cryptography, SHA-1 is a cryptographic hash function designed by the United States National Security Agency and published by the United States NIST as a U.S. Federal Information Processing Standard. SHA stands for “secure hash algorithm”. The four SHA algorithms are structured differently and are distinguished as SHA-0, SHA-1, SHA-2, and SHA-3. SHA-1 is very similar to SHA-0, but corrects an error in the original SHA hash specification that led to significant weaknesses. The SHA-0 algorithm was not adopted by many applications. SHA-2 on the other hand significantly differs from the SHA-1 hash function.
Other stories online seeking to connect bitcoin with intelligence agencies evokes In-Q-Tel. According to Wikipedia:
In-Q-Tel… is a not-for-profit venture capital firm that invests in high-tech companies for the sole purpose of keeping the Central Intelligence Agency, and other intelligence agencies, equipped with the latest in information technology in support of United States intelligence capability.
A basic premise of individuals holding the belief that bitcoin was created by a government agency is that bitcoin was created as an pseudonymous currency, passed on as an anonymous currency, for the sole purpose of tracking criminals attempting to launder money. Towards this end of tracking criminals, In-Q-Tel exists, making it a prime suspect to invest in bitcoin related startups if indeed bitcoin were a law enforcement project.
But, the most in-depth connection between In-Q-Tel and bitcoin is via Google, a by-no-means-whatsoever concrete affiliation. Google’s connection to In-Q-Tel is not public. But, in 2006, ex-CIA officer Robert David Steele told Home Security Today that Google “has been taking money and direction for elements of the US Intelligence Community, including the Office of Research and Development at the Central Intelligence Agency, In-Q-Tel, and in all probability, both the National Security Agency (NSA) and the Army’s Intelligence and Security Command.”
The year before In-Q-Tel sold more than 5,000 shares of Google stock. In 2010 Google announced it was working directly with the National Security Agency so as to secure its electronic assets. Also in 2010 Wired reported that In-Q-Tel and Google had jointly provided venture capital funding to Recorded Future Inc, a temporal analytics search engine company that analyzes tens of thousands of web sources in order to predict trends and events.
But Google has itself not yet invested in bitcoin. The conglomerate does not accept bitcoin for any of its products or services. What’s more, it has invested in alternative digital currencies other than bitcoin.
Paltry is the evidence regarding the claim that a government agency is directly responsible for bitcoin. Instead, what’s more likely, is that government researchers and the possible player or players referred to as “Satoshi Nakamoto” attended similar gatherings and perhaps shared acquaintances. Before the arrival of bitcoin, at the very beginning of this new century, financial cryptology conferences were not well attended but by perhaps twenty people. Attendees at these conferences might give us an idea into the minds participating in a dialogue that ultimately led to bitcoin. With this said, it is entirely possible still that Satoshi Nakamoto’s experiences outside this clique saved him from many of the fallacies early researchers internalized, such as centralized “banks” for the “electronic currency.”
All-in-all, those who claim bitcoin was designed by “The Man” do not have adequate proof.
Roger Ver weighed in over the potential increase in the Bitcoin block size today. He noted his deep respect for people from each perspective on the issue, and lamented the censorship seen on certain Bitcoin forums.
“Censorship is never the answer,” Ver noted.
Bitcoin’s ability to “resist financial censorship” is what first attracted Ver to Bitcoin. He implores the Bitcoin community in his note, posted on his website http://bitcoin.com, not to censor itself.
“Currently, many people seem to be under the false impression that bigger blocks mean fewer full nodes on the Bitcoin network, leading to more centralization, and a higher likelihood of governments being able to subvert, censor, or otherwise control Bitcoin,” Ver wrote. This is not the way Ver sees it.
“If this were true, I would certainly oppose any increase to the block size, but I think this is clearly wrong for several reasons.” One of Ver’s main reasons for using Bitcoin XT is to increase the block size limit to 8MB. This means “room for eight times as many Bitcoin users, so that would mean up to at least 48M users from the current estimated 6M,” the Bitcoin investor wrote.
“…It should be clear to everyone that bigger blocks will likely mean more full nodes around the world, and therefore more decentralization, not less. This will make Bitcoin even more difficult to control, censor, or be stopped by anyone, including governments.”
Roger Ver responded to questions and comments in the article section of the until the publishing of this article. The full article can be read here.
BitPay introduced this week an update to their backend which will make it easier for Bitcoin accepting merchants using the BitPay platform to accept payments. In 2011, as BitPay became the world’s first Bitcoin payment processor, there were many features that merchants using the service wanted and needed in order to have more control over their e-commerce business.
Yesterday the firm introduced an improvement to its platform, enabling BitPay merchants to initiate refunds and adjust invoices through their merchant dashboard.
Users can now adjust overpaid/underpaid invoices, as well as initiate total or partial refunds.
“This makes our merchants more self-reliant, accelerates the refund process, and provides a better customer support experience,” the firm wrote in a blog post on its website.
The old way of doing this on the BitPay platform was reaching out to customer service, a tedious process for any busy business owner, and also now-and-then irksome to some customers.
BitPay invoices will now feature a notes section complete with details about the invoice. Users taking advantage of BitPay’s payment protocol wallet will find the refund process extremely easy.
“Partial refunds can also be initiated through the dashboard and give more flexibility to handle overpayments, offer discounts, or retain restocking fees,” wrote BitPay.
If you have comments on BitPay’s changes, you can discuss on their forums at BitPay Labs. The payment processing firm has further plans on the horizon.
“We look forward to releasing more product improvements in the following months.”
CEO of Fidor Bank of Germany, Matthias Kröner, has long been a supporter of Bitcoin. In recent comments to IBTimes, the CEO said that Bitcoin is the “natural part of digital lifestyle.” Fidor Bank, he also said, is opening in the United Kingdom this year. This means that people interested in Bitcoin in UK will find it easier than ever to use, especially with a forthcoming exchange set to be launched by Fidor soon.
“When we approach an issue we ask ourselves, ‘why can’t this be done any better’, or ‘is that really the final solution’, or if there is a segment like the crypto issue, ‘why is this not being executed by a normal bank?'” Kröner said.
Bitcoin regulations – or lack thereof – have been a problem even for Kröner who mentions that regulations in Germany are unclear and that he himself has been a proponent of Bitcoin to politicians. He has not necessarily succeeded in this capacity, criticizing politicians and calling them “the biggest local disadvantage.” Unlike many Bitcoiners, he does not value anonymity more than some of Bitcoin’s other features.
“I definitely do not understand the fundamentalists in the crypto environment saying that anonymity or anonymous status is kind of sacred heaven. I want to know who potentially wants to fool me.” For him, Bitcoin has a long way to still go to achieve mainstream appeal, and he knows his bank can lead the way.
“I know that this an uphill struggle. From my perspective, having a full European banking licence, I’m definitely defending this line saying, you need to regulate this – in a constructive way.
“If it’s unregulated, this is a grey market, and grey markets are always negative. You have to legalise it; banning is not an option.”
The German bank has operated with a full European banking license since 2009. It plans to launch a Bitcoin exchange, called “Bitcoin Express,” which will allow users to buy and sell bitcoin instantly on its partner exchange, bitcoin.de. Fidor bank also has a partnership with Kraken in the USA.
Numerous nations throughout the world are currently dealing with currency or debt crises of one kind or another. Greece has stolen the headlines where they’ve needed to secure a bailout from the European Union so as to not go broke, and Puerto Rico, a US protectorate, has said it will not have the funds to service its debt. The Chinese stock market has collapsed with the government instituting controls to prop it up, while in Venezuela inflation ravages the food aisle, which have gone bear in recent months.
In China, you see gold is clear winner in the wake of recent turmoil. Included in this article are the regional interest data points from Google Trends.
Included in this article are the data points for regional interest. In China, regional interest in Bitcoin is different than the other countries. Whereas in Greece, Puerto Rico and Venezuela interest in Bitcoin is tied to the main cities of the country, in China the interest appears more diffuse.
As you see below, interest in both gold and Bitcoin have increased in terms of Google Trends search queries in Greece. Gold has seen a modest spike, while Bitcoin is clear winner in terms of new, recent interest in Greece.
As in the remaining countries, precious metals queries occurs throughout the nation, while Bitcoin queries is more-so located in Athens.
In Venezuela, gold and Bitcoin have seen an increase in search queries, silver not so much.
And regional interest in Venezuela:
- Venezuelans are interested in silver throughout Venezuela.
In Puerto Rico, similar trends:
With Greece inching closer to a default, and European partners putting pressure on the southern Greek nation, Greeks have pulled money out of banks to the tune of 2 billion euros this week. Alongside this trend, we see an increasing interest in the precious metals sector, as well as the crypto-currency sector, on Google Trends.
Gold, too, has seen a spike in interest.
And, finally, Bitcoin, which last saw a spike in interest in 2013, has also seen an increase in interest.
When one goes to a Bitcoin event, they are greeted by a scene of mostly men, many of whom flex their egos and their low-end Rolex watches as if they have a lot going for them. Some, mostly VCs, who have only been into bitcoin a short time, pretend that they are pioneers, trying to cement themselves as their own sort of pariah at least in their own. Oh yeah, and a lot of them want to hold your money or for you to invest in their redundant Bitcoin projects. There is very little networking and working together, just peacocking and unfounded confidence or insecurity. Many males seem to have forgotten that they are not, in fact, Satoshi Nakamoto.
But while male ego might dominate many crypto-currency scenes for now, a dedicated group of Crypto Moms is working to change that. Meet Crypto Moms. Read More
Denarium hopes to supply such coins to appease the demand for physical bitcoins.
“What we hope to achieve is to allow everyone to have an easy-to-understand gateway to the world of Bitcoin. Our first product is a simple, low-cost product that anyone can afford,” Denarium co-founder, Henry Brade, told Crypto Coins News.
You see in the following post OkayBitcoin making the point that bitcoiners could inject their views and opinions into the presidential debate by telling Rand Paul what he needs to know about Bitcoin:
Republican Presidential candidate Rand Paul has pledged to implement the most innovative digital and tech effort of any of the 2016 presidential candidates, and he is welcoming ideas, making the Rand Paul 2016 presidential campaign a significant forum for the Bitcoin community to inject their ideas into the election.
The following post came from OkayBitcoin, who writes today about USAA is looking to making their operations more sophisticated with the power of the block chain. When people usually think about Bitcoin, they think about money. The block chain, which powers Bitcoin, is where the power lies.
The San Antonio, Texas-based financial institution USAA, which focuses on serving current and former members of the military, is investigating the “underlying technology” behind the digital currency Bitcoin in order to make its operations more efficient, according to a company executive. Read More
Launched in 2015, the peer-to-peer bitcoin trading site Roolo features multisig wallet technology, with instant transfers and fees of 0.5% on one side of the trade only.
Roolo’s transactions are “on the block chain”. Thus, bitcoins are never mixed and always transparent upon the block chain.
Roolo is operated by Anthony Culligan and Nicholas Pennington, both of whom have considerable experience prior to starting Roolo. Crypto Coins News recently discussed Roolo and Bitcoin with Anthony Culligan, Roolo CEO, who has worked for JP Morgan and other major financial firms. Read More
An SEC filing April 10. 2015 by PayPal hints its merchants can accept Bitcoin. The filing reads:
A merchant can typically open a standard PayPal account and begin accepting payments through PayPal within a few minutes. Most online or mobile merchants can onboard quickly and are not required to invest in new or specialized hardware. Our Payments Platform supports growth with a variety of value-added services designed to help businesses of all sizes manage their cash flow, invoice clients, pay bills, and reduce the need for merchants to receive and store sensitive customer financial information. For our standard service, we do not charge merchants setup or recurring fees. A merchant can also integrate with Braintree to begin accepting payments with credit or debit cards, PayPal, Venmo, digital currencies such as Bitcoin, or other payment solutions with a single integration.
Last September PayPal started accepting Bitcoin through Braintree, also partnering with Coinbase, BitPay and GoCoin.
“PayPal is playing the role of the intermediary, but the cost will be left up to the merchant and the payment processor,” said Scott Ellison, PayPal’s senior director of competitive intelligence and corporate strategy.
In 2014, PayPal told the Australian Senate:
“While the currency itself should not be regulated, and transactions by individual users without the assistance of the intermediaries should not be regulated, companies that provide a financial service for digital currency transmission, for issuance or sale of digital currency, or for exchange with other currencies such as the Australian Dollar, should be regulated in a manner similar to the existing regulations that apply to other payment services… Those regulations, however, should be adapted to recognize the specific details of how different digital currencies work, particularly ‘decentralized’ digital currencies that are not controlled by a specific issuer.”
Currency war between China and the US has been on the mind’s of financial analysts, and has mostly been about China reconsidering the dollar as a global reserve currency while China itself is a major stakeholder of the dollar. A debate is raging about what would happen if the Chinese adopted Bitcoin. If China started using Bitcoin, could it then begin leaking US dollars into international markets thus lowering the reserve currency’s value? Read More
Until last week, Blythe Masters was the butt-of-jokes from individuals like Max Keiser and the subject of many memes. In this episode of The Keiser Report, Max Keiser clarifies the claim by Blythe Masters that JP Morgan does not manipulate silver prices.
In this following meme, Banzai7 goes a bit further.
Bitcoiners have had quite a showing in March compared to most other markets.
The following interview was conducted by Bitcoinomics.Net with Janina Lowisz, the first “holder” of a “Blockchain ID,” about the Blockchain ID, world citizenship and numerous other topics relating to the BlockchainID.
What is a BlockchainID?
The blockchain ID was invented by Chris Ellis from World Crypto Network and Bitnation founder Susanne Tarkowski Tempelhof, and makes use of the Bitcoin blockchain and available cryptographic tools to provide IDs that are not issued by nation-states but privately. It is one of the pilot projects Bitnation did so far to show how governance services can be done in a private, voluntary and decentralised way. Today, the blockchainID could be used for online verification, as part of a reputation system to facilitate transactions, for voting, or it could be used by stateless people or in war zones. The blockchainID will be available on www.bitnation.co in Q1.
As is made clear in the above announcement, GoldSilver, owned by well-known sound money proponent Mike Maloney, has begun accepting Bitcoin for gold and silver. While not the first bitcoin-to-bullion vendor, GoldSilver’s Maloney has made it clear he supports Bitcoin. He was brought to the coin very much the same way many other precious metals investors were – via Trace Mayer.
It’s not only Mike Maloney accepting Bitcoin now, but also Peter Schiff, who also recently began accepting Bitcoin for gold and silver.
Mike Maloney is perhaps best known for his popular YouTube series, The Hidden Secrets Of Money. For that series, click here.