Could Bitcoin Go Legit? 300
Velcroman1 writes "On May 15, the Department of Homeland Security seized a digital bank account used by 'MtGox,' the world's largest exchange, where people buy and sell bitcoins. DHS alleged, and a judge agreed, that there is 'probable cause' that MtGox is an 'unlicensed money service business.' If proven, the penalty for operating such a business is a fine and up to 5 years in jail. FoxNews.com caught up with several bitcoin exchanges, including CampBX, MtGox, CoinLab and more, to ask them how they've navigated the regulatory waters — and how to go legit." In other shady bitcoin news, it appears the demise of Liberty Reserve has caused hackers to find a new alternative. twoheadedboy writes "Despite suggestions Bitcoin might be the ideal currency for dealers on the dark web, it appears Perfect Money, a Panama-based operation, is proving the most popular alternative to the now-defunct Liberty Reserve. A source working the underground forums told TechWeekEurope that, for now, fraudsters are rapidly migrating to Perfect Money. Many vendors have started accepting it, having previously primarily used Liberty Reserve, which was shut down following the arrest of its founder and four other members this past week. Internet fraudsters might be interested in Perfect Money as it has distanced itself from the U.S., cutting off all new American registrations. However, one forum user said he was turned down by Perfect Money as their 'type of activity is not welcome.' Other currencies may yet win out."
Feathercoin - Bitcoin Alternative (Score:2, Informative)
While Bitcoin tends to grab headlines, there's other crypto-currency projects that are focused on merchant adoption:
http://www.feathercoin.com/about/
Tired of this (Score:1, Informative)
Oh, look, it's the weekly Bitcoin post.
Re:Do your part to kill it (Score:4, Informative)
You do realize that is exactly what people who mine BitCoin want you to do, right? They make 0.0005 BTC (currently 6.5 cents) each time you move money. If you elect not to include the transaction fee, miners will typically drop your transaction on the floor.
I know I won't stop you, but then again, I mine BitCoins and could use your money. Have fun!
BTW: Weird you got a +1 for your dumb idea. Typical slashdot retard moderators.
Re:Feathercoin - Bitcoin Alternative (Score:4, Informative)
The pattern of these alternative bitcoin forks has been to fork bitcoin (or in your case, litecoin), mine a bunch of coins for the founders, then generate a lot of buzz, including spamming Slashdot (which you and your buddies are doing), let the price go up for a while, then at some point people will see the project isn't going anywhere and flee, and the founders will cash out their XYZ-coins before the entire currency devalues to nothingness.
I don't know that your bitcoin fork falls into this category but given how much you guys are spamming and shilling, it sure isn't looking good. I'm going to stay the hell away from it.
Visa pays you in Linden Dollars (Score:2, Informative)
"Why would I want to pay in BTC? "
Because the thing you want to buy is sold in Bitcoins, and the equivalent sold in dollars are 3% or more more expensive (the Visa service charge ). Visa doesn't pay you money, it takes more and hands back a little. BTC transactions undercut that. I bought ASICs in Bitcoins and will be donating the next ones I find to EFF/Wikileaks and other things that benefit society.
"Those guys (still anonymous!) may have done good for the society, but the society cannot value the formula (that doesn't even save lives!) that high. BG's Windows does save lives, as part of many computers"
Welcome to a gold rush. Better the first/fastest miners get the gold, than some fat lazy banker. At least they did *some* of the work!
But basically I agree with your argument. You're talking about the values of one currency versus another, and the action against MtGox as an 'unlicensed money service business' shows the Feds confirming it as a currency. So you're confirming it as a valid currency, even if the Fed's are busing trying to find ways to attack it.
(first they ignore you, then they attack you, then you win)
You can buy Linden Dollars, and Farmvile dollars, and XBox credits, but you can't buy Bitcoins? So it's more than legitimate, it's got them scared.
Re:A question to the community (Score:3, Informative)
https://en.bitcoin.it/wiki/Weaknesses [bitcoin.it]
Don't bother to read that site - not that there's any evidence that you did - because there are no real attack vectors there.
Unless you think "denial of service" is a valid there's nothing on the linked site that constitutes a real attack.
Yet another example of the "unsupported allegation" type of post... but I applaud your attempt to make it sound legitimate by supplying a link.
Try again.
Re: actually if the fee is only 6.5 cents... (Score:4, Informative)
Doesn't actually work like that. Each "coin" or wallet does not maintain it's own separate chain. There is one block chain which contains all transactions. New transactions are added to the chain with each block mined. That's simplified a bit, but more or less accurate.
Specifically what happens is a miner (disregarding mining pools for now, as a pool can be treated as a single miner for the purposes of the mechanics of bitcoin) gets a list of transactions from other miners and clients in the peer-to-peer network, each with a transaction fee attached. The miner uses this transaction list in conjunction with the most recent block hash to generate a hash of a new block which meets certain requirements (based on the current difficulty of mining, which is self-regulated by the network). This new block is sent off to the network, and once that block is used to generate another, the transactions in the created block are "verified", including the 25BTC (currently) transaction to the address of the miner, from nowhere. The miner also gets all transaction fees for transactions in the block. Not counting attempts to manipulate the block chain (i.e. forking, making a series of fake blocks and attempting to pass them off as legitimate), there is only ever the one block chain, just many copies of it.
Re:A question to the community (Score:4, Informative)
Fatal flaw with your logic: If people anticipated prices going up, then prices would already be that high, minus the price of time. This is a mathematical theorem [wikipedia.org]. Likewise, if people know that Bitcoin will achieve mass adoption in the future, they will buy the currency and hold it, until they believe it reaches its peak, at which point they spend it. This is how new money effectively enters circulation, or to be more accurate, this is how price levels remain stable, regardless of the method of money allocation (the reason that central bank inflation is wrong is, even if predictable, the created money effectively steals from the existing base of savings to be given to creditors, banks, and the politically well-connected -- the so-called inflation tax). If Bitcoin's price is far below this level, this is due to the perceived risk: People holding Bitcoin will be greatly rewarded if it does achieve adoption, at the risk that they lose everything.
Another way to put it is: The total amount of natural resources at our disposal isn't increasing, why should the money supply?
Before a US central bank oversaw the money supply, prices largely remained stable, the price of commodities remained stable or went down (as manufacturing methods improved). Post-gold-standard, though? Prices go through the roof [stlouisfed.org].
Your description of prices suggests that they somehow form a positive feedback loop. They most certainly do not. The only aspect of prices that could be spoken of in this form is speculation, and since there are limited resources to speculate with, bubbles always burst.