The Bitcoin Insanity Continues — Prices Top $450

Elios

Supreme [H]ardness
Joined
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the first speaker at the hearing is positive so far, just expressing concern for illicit use and money laundering.
Jennifer Shasky Calvery
Director, Financial Crimes Enforcement Network
U.S. Department of the Treasury
how are you watching CSPAN?
 

sfsuphysics

I don't get it
Joined
Jan 14, 2007
Messages
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what you describe is pretty much exactly the same as our existing financial system. Our US dollar is backed by nothing anymore. It used to be, but it's not anymore.

The confidence and power of the US dollar was rooted in the economic strength of things we as a country were able to produce combined with an almost universal *belief* that the US dollar is solid.
<rant snipped>
And how much has your dollars changed in value over the last 5 years? Could you buy about the same amount? Or did the value of them springboard all over the place?

So yeah, there's nothing physical backing US dollars other than the ability of people willing to trade in them, but lets not confuse bitcoins with US dollars and consider them "the same thing" because they're not. Bitcoins are closer to a Zimbabwe currency which fluctuates rapidly by large amounts on a daily basis (ok not true Zimbabwe got their currency more under control). Bitcoins are basically like stocks right now, if you play it smart you can make them profitable, there's not much of any profit in trading currency ... at least at small levels.
 

J Macker

[H]F Junkie
Joined
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Messages
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Mythili Raman Acting Assistant Attorney General, Criminal Division
U.S. Department of Justice
she just talked about the previous illegal use. need to deter criminal activity.
work with congress to ensure it has the tools to protect the public. prosecute criminals who use the currencies.

Edward W. Lowery III Special Agent in Charge, Criminal Investigative Division
U.S. Secret Service, U.S. Department of Homeland Security
criminals use digital currencies. talking about Liberty Reserve.
The use of digital currencies is expected to continue....
talking about money laundering, cyber crime and going after the individuals responsible.
SS prioritizes investigations of administrators of exchanges ensuring they comply with money laundering laws.
"Digital currencies are a tool used by a wide variety of criminals"

they don't seem to regonize legitimate users and benefits. They're just emphasizing criminal use, and both speakers stated digital currencies will continue to be a challenge
 

J Macker

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first speaker is back: minimize regulatory burden, make sure virtual currency exchangers & administrators fit within our regulatory scheme.

Second speaker again: digital currencies are not illegal and there are many legitimate users out there.
talking about Liberty Reserve.

committee chairman:
The role we are attempting to play on this committee today is to determine oversight role

"several new payment methods" have worked out for the good (Jennifer Shasky Calvery)
benefits to consumers... pre-paid cards enable access to the financial system. online banking for the consumer & ACH is good. Technological advances are good for the consumer.

"we need to think how might criminals exploit these systems" cash is still the best way to launder money.
 

kirbyrj

Fully [H]
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I'm pretty sure the Chinese are behind the recent spike in price. But it essentially tripled in price over the past 2 weeks.
 

J Macker

[H]F Junkie
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is BTC legal within existing laws?
Lowery: his answer summarized: many criminals have not gravitated toward P2P. As long as use fits within laws, there's no concern for Secret Service

Ramen answer: our current abilities to prosecute (criminal statues) (money transmitter statutes) are effective and the tools are in place that (we) as prosecutors need. Updates and changes within the past few years are effective and can continue to be updated.

Jennifer Shasky Calvery: we won't say it's a currency or not a currency.
this country is interested in protecting our financial system & american consumers.
other fluff. same perspective but no opinion on decaring it a currency.
 

kirbyrj

Fully [H]
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The FBI is in possession of something like 200,000 bitcoins as a result of the Silk Road bust, so perhaps tax dollars are being spent to surge the bitcoin price up so that these coins can be liquidated for a huge profit.
That's just a ridiculous comment. 200,000x$700 = $140M. You do realize that the government operates on a $3.6 TRILLION dollar budget. It's something like $10 Billion dollars every day, so you're talking about a number that represents 1.5% of the daily budget. You'e talking about a number the government uses every 15-20 minutes. They aren't trying to raise prices artificially to make money.
 

J Macker

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GAO is preparing report or something to recommends that IRS provide requirements for reporting income on virtual currencies.

new silk roads have been created. how do we develop a strategy to deal with these sites?
are there characteristics about these sites that mke it difficulty for law enforcement to respond?

Lowery answer: 3 parts of the infrastructure enable criminal activity; the sites (silk roads), digital currencies & bullet-proof hosters (business setup in country with little or no laws).

Raman: anonymity is the challenge. we have tools & strategies to address the methods people use for anonymity. important to take steps to disrupt & send message to users of the websites that they can't trust the websites, not immune to investigation.

Q: there's concern that virtual currency business may leave the US to countries with less regulatory framework. What can we do to help keep these businesses in the US?

Shasky Calvery answer: gains are short lived for leaving the US. all countries want to protect their own financial systems. Regulation at home & abroad will catch up. She thinks the innovation & jobs will stay, or they will come back to the US.
To make sure we have regulatory framework, the task force ensures (around the world) that money laundering laws are not broken. Other countries are trying to figure out how they can catch up (regulations) to address digital currencies.

taking a break. I wont' be summarizing the second half
 

weuntouchable

[H]ard|Gawd
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That's just a ridiculous comment. 200,000x$700 = $140M. You do realize that the government operates on a $3.6 TRILLION dollar budget. It's something like $10 Billion dollars every day, so you're talking about a number that represents 1.5% of the daily budget. You'e talking about a number the government uses every 15-20 minutes. They aren't trying to raise prices artificially to make money.
Its 100% speculation on my part, but your argument makes no sense. So if I have $1 billion I wipe my ass with $1 million? And the FBI operates on a budget of approximately $8 billion. Which is only $22 million per day. $140 million funds the FBI for a week. I don't think what I speculated is occurring, but I also wouldn't be completely shocked if it was.
 

kirbyrj

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Its 100% speculation on my part, but your argument makes no sense. So if I have $1 billion I wipe my ass with $1 million? And the FBI operates on a budget of approximately $8 billion. Which is only $22 million per day. $140 million funds the FBI for a week. I don't think what I speculated is occurring, but I also wouldn't be completely shocked if it was.
http://www.forbes.com/sites/kashmirhill/2013/10/04/fbi-silk-road-bitcoin-seizure/

Here's your answer. They can't liquidate "evidence" until final disposition of the case.
 

NickJames

Supreme [H]ardness
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I was going to buy this a year ago, I hate myself every time I see it.
 

leeleatherwood

[H]ard|Gawd
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GAO is preparing report or something to recommends that IRS provide requirements for reporting income on virtual currencies.

new silk roads have been created. how do we develop a strategy to deal with these sites?
are there characteristics about these sites that mke it difficulty for law enforcement to respond?

Lowery answer: 3 parts of the infrastructure enable criminal activity; the sites (silk roads), digital currencies & bullet-proof hosters (business setup in country with little or no laws).

Raman: anonymity is the challenge. we have tools & strategies to address the methods people use for anonymity. important to take steps to disrupt & send message to users of the websites that they can't trust the websites, not immune to investigation.

Q: there's concern that virtual currency business may leave the US to countries with less regulatory framework. What can we do to help keep these businesses in the US?

Shasky Calvery answer: gains are short lived for leaving the US. all countries want to protect their own financial systems. Regulation at home & abroad will catch up. She thinks the innovation & jobs will stay, or they will come back to the US.
To make sure we have regulatory framework, the task force ensures (around the world) that money laundering laws are not broken. Other countries are trying to figure out how they can catch up (regulations) to address digital currencies.

taking a break. I wont' be summarizing the second half
Thanks!
 

Omegas

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I'm down to 29 weeks to go before I find out how much I had stashed in a very old wallet. Come on baby HIT!!
 

kirbyrj

Fully [H]
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I hate myself for not buying last-week... Just cracked $830

I have $0.056 bitcoins, so I'm up to $40 :rolleyes:
It's funny...last week it was down around $275 and I said to myself I should buy some as it's kind of low. Oh well. Even LTC went from $2.20 or so to $8.60 over the weekend.
 

NickJames

Supreme [H]ardness
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6,675
yeah me too :rolleyes:
I have nothing to prove but I had registered an exchange account back in April 2012. They wanted a valid ID that wasn't about to expire since my DL was 3 months from expiration. So I tried my passport but apparently it was out of focus or something and they needed me to send it again. Long story short, it was too much BS to deal with so I dropped the idea. I kick myself in the ass thinking about it so I started investing in stock that's doing rather well like AMD. But nothing will come close to the possible gains I could have envisioned with Bitcoin. I believe it was trading for around $4-10/coin back then and I was ready to put down 1K.
 

STrooperTK421

Limp Gawd
Joined
Oct 8, 2009
Messages
466
I'm just waiting for the bubble to pop so I can watch a bunch of people get their asses handed back to them in steaming chunks on a paper plate.
 

Aluisious

2[H]4U
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Messages
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It won't. There are committees meeting today to discuss the future of Bitcoin in the US. The fervent buying right now is because (some of this is speculative) China is trying to take control of Bitcoin and gain a majority of the Bitcoins that have been generated. The Chinese interest is believed to be a play on gaining future inroads in mineral rich Africa as well as to try and get a jump on a world currency that is not dollars.
Don't believe everything you read :rolleyes:
 

meme

Limp Gawd
Joined
Jul 15, 2004
Messages
239
Nobody except a small number of drug users actually uses bitcoin as a currency. Bitcoin is bought by speculators and its price is almost completely due to speculators.

Take the speculators out of the market and you get the real price, which might be somewhere in the neighborhood of 10 cents per bitcoin. That price would be high enough to support everyone who actually uses it as a currency.

So, either at some point in the future large numbers of people begin using it as a currency, thus justifying the current price, or else the price eventually crashes down to almost nothing.
 

Aluisious

2[H]4U
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Messages
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The thing dumb money never releases is that speculation is a zero sum game. To make a profit you need to sell, so most of the lucky dopes who own the "asset" at a market price will never sell it for that.

If you're buying bitcoins because "they go up!" then you're not the smart money.
 

SonDa5

Supreme [H]ardness
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Aug 20, 2008
Messages
7,404
What a crock of crap.

This BIT Coing make believe market is going to crash and when it does those that believe in it will be very sad.

Wake up people this Bit Coin mining crap is fake.
 

Retronym

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The thing dumb money never releases is that speculation is a zero sum game. To make a profit you need to sell, so most of the lucky dopes who own the "asset" at a market price will never sell it for that.

If you're buying bitcoins because "they go up!" then you're not the smart money.
Thank you for explaining realized gains. We had no idea.
 
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