Tag Archive : blockchain

Many More Bitcoiners Are Going To Jail & The Community Won’t Care

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.

Steve Albini Appreciates Bitcoin Technology, Skeptical Of The Blockchain


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.”

6 Largest Blockchain Crowd Sales

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.

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Bitcoin Companies Have No Problem Complying




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.

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10 Best Use Cases Of Blockchain

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.

BitGold Strives To Go Public & Offer Services In US, Raises Another $17 Million For Gold Storage

At the end of last week, BitGold announced it raised $17 million in a deal that began as a $14.8 million offering. This deal is one of many in recent months which has put the company at the forefront of the financial press. Alongside the millions in recently raised capital, BitGold founder Joshua Crumb has stated the company strives to be public and operating in the US by the end of the year.

“Post our acquisition of GoldMoney and the institutional raise, we are taking steps for both main board listing on the TSX as well as a US listing strategy,” co-founder and chief strategy officer Joshua Crumb said. “We would like to be listed and offering services in the US later in the year.” Crumb also stressed how BitGold is different from other online gold platforms; namely, the platform allows investors to buy gold within 1% of real-time prices.

“We built our own exchange to get the best price possible and reduced settlement from a couple of days to instantly,” Crumb said.

In an exclusive interview with James Turk, which only appears in Jeff Berwick’s TDV Paid Newsletter,  Jeff Berwick discussed GoldMoney’s merger/acquisition with BitGold with founder of GoldMoney, James Turk. In the interview, Turk gives interesting insights into why he went forward with the deal, and the benefits of the deal for GoldMoney clients.

Turk has 40 years of experience in international banking, finance and investments, having begun his career at Chase Manhattan Bank.  In 2001, Turk co-founded GoldMoney and remains a director of the group today.

In the interview, Turk mentions that GoldMoney will now enjoy additional regulatory overview since it is a part of BitGold, which is listed on the Toronto Stock Venture Exchange. GoldMoney customers will enjoy the same operation as before, yet with the addition of new products offered by BitGold.

“Technology is evolving rapidly and BitGold is in the forefront of this evolution with Aurum, which represents the latest developments in software and hardware to conduct online financial services efficiently, safely and securely,” Turk tells Berwick. “The services made available by BitGold also enables GoldMoney shareholders to continue pursuing their original vision, to return gold to the center of global commerce by enabling the circulation of digital gold currency.”  Turk tells Berwick that, with GoldMoney’s long history, and BitGold’s new technology in Aurum, the two companies are complementary.

“GoldMoney brings critical mass and 15 years of experience, and BitGold brings technology and a management team with a clear vision of what GoldMoney had always set out to achieve as its long-term goal, the circulation of digital gold currency (DGC).” There are also new products planned by BitGold and GoldMoney.

“These include a plastic debit card that enables customers to spend their gold balance at any traditional point of sale, where credit/debit cards are accepted, or to withdraw local currency from any traditional ATM,” Turk says. “Also, there will soon be a mobile application for iPhone, Android and Blackberry, allowing full dealing and payments capabilities.”

“In addition to the 400-ounce, kilo and 100-gram bars available through GoldMoney, customers can take delivery of GoldMoney Cubes or BitGold Cubes in as little as 10 gram increments.” The rest of the interview is available by clicking here and subscribing to the TDV Newsletter.