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Speaking of banks and BTC:
- 1st they deny it
- 2nd they fight it
- 3rd they join it (we are close to this point)
- 4th they assimilate
The 4th step will take it closer to mainstream, but this is where I'm cautious. Going mainstream comes with its own familiar problems; many of which bitcoiners originally sought to alleviate.
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This is probably the announcement: http://www.wsj.com/articles/first-u-s-bitcoin-exchange-set-to-open-1422221641By GREG BENSINGER Jan. 25, 2015 4:34 p.m. ET 0 COMMENTS The virtual currency bitcoin is getting a very real boost on Monday, with the opening of the first licensed U.S. exchange. Coinbase Inc., a startup backed by $106 million from the New York Stock Exchange, banks and venture-capital firms, said its exchange will offer greater security for individuals and institutions to trade bitcoin and monitor real-time pricing of the cryptocurrency. The exchange could bring needed legitimacy to the currency, which isn’t backed by a central government and is traded over virtual exchanges, primarily overseas. Coinbase said it has insurance, offering traders some assurance that their money won’t disappear. Bitcoin enthusiasts have been buffeted by the collapse of Japan-based exchange Mt. Gox last year—taking with it around half a billion dollars of investors’ money—and a security breach earlier this month at Slovenia-based exchange Bitstamp. The value of a bitcoin itself, determined by trading on existing exchanges, has fallen to about $240, from a peak in late 2013 of more than $1,200. “To have an organized exchange that has the backing of thoughtful venture capitalists and investors addresses one of the main problems with bitcoin: its extreme volatility,” said Campbell R. Harvey, a Duke University finance professor who has studied cryptocurrencies. “Bitcoin has been sorely in need of something like this.” Coinbase’s founders say they have been working for five months to win licenses from state financial regulators. They have regulatory approval in half of U.S. states, including large population centers like New York and California. For now, Coinbase can do business with account holders only in states where it has approval. Coinbase will take a small percentage—likely less than 1%—of most transactions, said Fred Ehrsam, 26 years old, a co-founder. The exchange will initially be limited to users in the U.S., but Chief Executive Brian Armstrong, 32, said he plans to expand overseas. Mr. Armstrong said he expected to attract both individuals and businesses looking to trade bitcoin. “Our goal is to become the world’s largest exchange,” he said. Others are looking to open U.S.-based bitcoin exchanges, including Tyler and Cameron Winklevoss, the twin brothers known for their early feuds with Facebook Inc. founder Mark Zuckerberg . Financial regulators, including the U.S. Federal Reserve, have been scrutinizing bitcoin recently. Benjamin Lawsky , the superintendent of the New York State Department of Financial Services, is working on a so-called BitLicense for firms looking to offer digital-currency services in the state; Coinbase is operating under earlier regulations. Mr. Lawsky’s plan is seen as a template for legislation in other jurisdictions, and it may give outsiders more confidence in the currency. Bitcoins are created using high-powered computers that “mine” for the currency by solving complex mathematical equations. They are exchanged digitally either for currency, or goods and services. Ownership and transactions are recorded, anonymously, in a so-called blockchain, which backers say reduces the risk of fraud. Bitcoin grew to prominence in recent years in part because of the ease with which it can be transferred. Coindesk, which tracks the price of bitcoins, says 82,000 businesses accept the currency, double that of a year earlier, including e-commerce site Overstock.com Inc. and Expedia Inc., as well as many small retailers. The value of all bitcoin is $3.2 billion, according to Coindesk’s price index. The NYSE invested in Coinbase during a $75 million round of fundraising that closed this month. Other investors include USAA Bank, the venture arm of Spain’s Banco Bilbao Vizcaya Argentaria SA, former Citigroup Inc. CEO Vikram Pandit and former Thomson Reuters Corp. CEO Tom Glocer. Venture backers include Draper Fisher Jurvetson, Andreessen Horowitz and Union Square Ventures. The NYSE’s investment was intended in part to “keep an eye on bitcoin as it matures as a legitimate currency,” President Tom Farley said. “Any currency relies on its acceptance.” The Coinbase exchange “is an important step for the currency to become socially acceptable.” Coinbase counts about 2.2 million consumer wallets and nearly 40,000 merchants that use its services. The company has about 75 employees and plans to operate in 30 countries by year-end, up from 19 today. I have been following this for months, if you look at the players and think about what and how they do things USAA Bank Citigroup ect ect and look at how Coinbase operates... you can pretty well kiss annonymity good bye if you use these services its a trade off and totally your decision. Just the first step for centralization and "regulation" of Bitcoin, although not total regulation and centralization... YET. This is what I worry about. I have been a long time Coinbase customer since its beginnings and over the years I have seen them slowly integrate more and more tracking with regards to tying your customer profile to addresses you send coins to or asking you about who you are transferring coins. I suppose, the tax man wants his cut too, but the anonymity of olden days helped build trust between individuals. Regulation should never be a substitute for trust and that is what we have today in the banking world. We (as customers/users) pay companies and banks for "trust" and in return we get secure transactions. In return for giving "trust," banks and companies get unprecedented access and control over its customer base. |
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One day bitcoin will be so integrated that we will wake up and realize that bitcoin IS the way to go and there is no point for using stupid fiat anymore.
But there is a point; control. History shows that every power loose their control at some point. Yes, indeed. I agree. Someone else may (or may not) seize new control, but at the end of the day; it's power and control. It's like how America started. A bunch of guys sick of religious and financial persecution got together, fought and went on to start a new country of their own where they could persecute on religion and financial matters. It doesn't matter who really. I just hope at least a small part of Bitcoin sees fruition in educating Americans (and other global citizen) what is really happening in the world with regards to money policy and how very slanted the system is. I hope it gets normal citizens charged about educating themselves properly and teaches them to see the bigger picture than if I buy X coin, I could make some money if big money jumps in. |
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One day bitcoin will be so integrated that we will wake up and realize that bitcoin IS the way to go and there is no point for using stupid fiat anymore.
But there is a point; control. |
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Why are Keynesians always wrong about economics?
The same reason flat-Earthers are always wrong about geography: because the theory is so thoroughly contradicted by the facts that only a fool or madman could believe it. But those Wikipedia drawings are so awesome... |
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With fiat, the ruling wealthy can continuously inflate the currency and still maintain their wealth without redistribution.
Most of the value held by rich people is not in the form of money, but in the form of assets (mainly capital, that is production, assets, such as companies). The distribution of wealth has not much to do with the monetary policy. In fact, only relatively poor people have a large part of their holdings in money. Everything which devaluates money is in fact punishing more the lower economic classes which have less means to protect their stores of value. Welcome to the elite my friend! The elite in practical knowledge that is. It's a shame few realize what you've said. Getting rich is for poor people, making money is for the rich. |
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Casual correlation:
1) Winklevii have long been trying to establish an ETF (COIN)
2) Recently, the Winklevii would like to start a BTC exchange (Gemini)
=> Winklevii may not be as optimistic as they once were regarding COIN, so now they look to start an exchange as a place to put their coins to use.
I hope they are at least diversifying all these Bitcoins into other crypto projects. All eggs in same cryptobasket = bad idea. Also exchanges are a thing of the past, at least centralized ones. Sure, diversifying in altcoins that no one cares sounds like a good idea  My thoughts: 1) COIN won't get the SEC approval anytime soon; the potential lose of tax revenue for USG is too large currently and not enough regulations are in place (yet) 2) Winklevii know this; why not front run an ETF with your own exchange? They would be the equivalent of the NYSE if eventually they get ETF approval (They'd be their own market mover). *I really dislike the fact that I see many of BTC's new infrastructure going the way of our current financial system. A great technology is being lost through osmosis of its best parts into a financially and morally corrupt banking system. Bitcoin infrastructure is going both way. Haven't you heard of Lighthouse, Bitsquare and OpenBazaar? Bitcoin infrastructure being developed both way is good for broader adoption, one for legitimacy and mainstream adoption and the second one for the honeybadgers of this world. All connected with the same currency. I've heard of only Bitsqare and OpenBazaar; Lighthouse looks neat. I appreciate the tip off. Just some thoughts: Bitcoin doesn't need legitimacy, it already has it by merely existing. The idea of Bitcoin is rooted in trust (decentralization), something humans do not intrinsically possess. The Bitcoiners of the world are demanding security and the implementation of trust (regulated processes) because most are speculating on making a profit from it, hence they care about mitigating losses. This is the fault of humans, not the need for legitimacy of the tech. Outside of speculation/trading, what purpose does BTC serve the average citizen that fiat dollars doesn't? If given in the future BTC was implemented similar to a currency, what advantages would it offer that fiat currency can't? The potential value of what BTC and blockchain technology offers is slanted to those who control the fiat I believe. Short of cheaper moneygram transactions, hedging economic inflation a bit, impressing your friends, diversifying investments, etc. it means nothing. I am not saying BTC is bad, but the technology is being developed by those with money and power (or will be assumed by those with money and power) because the common Bitcoiner is looking to this technology as his/her way out of their measly middle class life. Examples (Average Joe): 1) BTC exchanges -> NYSE, NASDAQ, FX already exists using fiat 2) Potential ETF -> Derivatives market already exists for fiat 3) BTC NFC mobile payments -> already exists for fiat and with numerous businesses/banks 4) BTC wallets backed by FDIC -> Bank accounts exist with this 5) BTC as hedge for inflation -> Commodities market already exists 6) Fast/low fee transactions -> Doesn't exist (the transaction processors stand to benefit from this way more than the average joe) 7) Buying goods/services -> already exists using fiat Examples (USG/business/financial elites) 1) Massive fiat revenue from conversion of fiat for IOUs. Little responsibility to customer on the part of the exchange (as of right now) 2) Unbacked digital asset becomes backed by real fiat (free money with no collateral) 3) Data mining gold-mine 4) Front/back and side door monitoring by the USG for taxation purposes, AML, etc. (huge benefit, companies will get kickbacks) 5) Exporting real fiat inflation into a (by then) somewhat stable reserve choice 6) Companies will save fiat money processing digital transactions and still make a profit by "helping the customer" with cheaper rates 7) Customers have vested interest in using BTC. It's like gift cards to them. Once customers buy BTC, they are more apt to spend it as Bitcoin because it is expensive to convert back; hence they are racing to accept BTC. |
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Casual correlation:
1) Winklevii have long been trying to establish an ETF (COIN)
2) Recently, the Winklevii would like to start a BTC exchange (Gemini)
=> Winklevii may not be as optimistic as they once were regarding COIN, so now they look to start an exchange as a place to put their coins to use.
I hope they are at least diversifying all these Bitcoins into other crypto projects. All eggs in same cryptobasket = bad idea. Also exchanges are a thing of the past, at least centralized ones. Sure, diversifying in altcoins that no one cares sounds like a good idea My thoughts: 1) COIN won't get the SEC approval anytime soon; the potential lose of tax revenue for USG is too large currently and not enough regulations are in place (yet) 2) Winklevii know this; why not front run an ETF with your own exchange? They would be the equivalent of the NYSE if eventually they get ETF approval (They'd be their own market mover). *I really dislike the fact that I see many of BTC's new infrastructure going the way of our current financial system. A great technology is being lost through osmosis of its best parts into a financially and morally corrupt banking system. You could be right. Ultimately if bitcoin becomes successful as a digital 'gold' like asset of fixed scarcity with internet utility, then the price will rise dramatically, encumbered or bossed by derivatives markets or not  Yep, I could totally see a future were BTC technology is separated into two parts: 1) derivatives/finance/store of value/reserve status and 2) blockchain technology: payments/remittances/transactions/invoicing, etc. |
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1. Who get the ownership of every newly created fiat money?
The US Treasury sells bonds to the Fed (through commercial banks) that are paid for with newly created fiat. Commercial banks lend money into existence and the UST uses it to fund government programs. If we were using gold and the vast majority of gold was taken out of supply (by hoarding or by it being dropped to the bottom of the ocean) then people would turn to something else (such as silver - but again this doesn't apply very well to Bitcoin so I wouldn't be expecting to get rich from holding Litecoin for a very long time).
Gold serves only as a store of value. The physical amount of gold does not matter; it is a finite resource. Fictitious numbers as an example: 1 candy bar = $0.10 USD in 1900 1 candy bar = $1 USD in 2000 Value of $1 USD in 2000 is 1/10th of what it used to be in 1900. 1 bar of gold = $100 USD in 1900 1 bar of gold = $1000 USD in 2000 Value of 1 bar of gold in 2000 is 10 times what it was in 1900 By placing your 1900s dollars in gold, you mitigated the loss of purchasing power over 100 years had you only bought candy bars with your money. Effectively, you can now take your $1000 dollars in 2000 and purchase $1 candy bars at the same purchasing power Charlie Chaplin enjoyed. |
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Casual correlation:
1) Winklevii have long been trying to establish an ETF (COIN)
2) Recently, the Winklevii would like to start a BTC exchange (Gemini)
=> Winklevii may not be as optimistic as they once were regarding COIN, so now they look to start an exchange as a place to put their coins to use.
I hope they are at least diversifying all these Bitcoins into other crypto projects. All eggs in same cryptobasket = bad idea. Also exchanges are a thing of the past, at least centralized ones. Sure, diversifying in altcoins that no one cares sounds like a good idea My thoughts: 1) COIN won't get the SEC approval anytime soon; the potential lose of tax revenue for USG is too large currently and not enough regulations are in place (yet) 2) Winklevii know this; why not front run an ETF with your own exchange? They would be the equivalent of the NYSE if eventually they get ETF approval (They'd be their own market mover). *I really dislike the fact that I see many of BTC's new infrastructure going the way of our current financial system. A great technology is being lost through osmosis of its best parts into a financially and morally corrupt banking system. |
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http://www.geekcipher.com/featured/fdic-operation-choke-point-could-bitcoin-be-the-answer/The U.S. House of Representatives committee on oversight and government reform released a staff report on the Federal Deposit Insurance Corporation’s (FDIC) involvement in the “Operation Choke Point” on December 8th, 2014. This report details how the FDIC is bullying payment processors and banks to stop working with many legitimate services that the FDIC doesn’t approve of, such as ammunition, payday loans, pornography, coin dealers and dating services.
It is probably about time for these industries to start looking into cryptocurrencies such as Bitcoin and Monero for payment processing.
If possible, I would like to revive this thread. This has really important implications regarding BTC in the future. Insuring deposits by the FDIC is a terrible idea for BTC and its users. There are plenty of security measures currently available and many more to follow. The FDIC makes lots of money every year off "insuring" bank deposits and anyone with 5 minutes of time can look up their records and will see that their reserves record is terrible and most of the time insolvent. I'd really hate to see the BTC community take this novel technology and run it through the same ol' meat grinder that is our current financial practice. One of the great purposes BTC could serve is to re-invent the way things are done, not implement it using the same goalposts and allowing the same people to run it. |
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Casual correlation:
1) Winklevii have long been trying to establish an ETF (COIN)
2) Recently, the Winklevii would like to start a BTC exchange (Gemini)
=> Winklevii may not be as optimistic as they once were regarding COIN, so now they look to start an exchange as a place to put their coins to use.
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I'm not fine with the insider trading, but I almost consider this to be the price of entry into the BTC world. I can live with it. It is going to happen when the market is unregulated. What I am really not okay with is price manipulation. Knowing if something is going up or down is one thing, but knowing that and then adjusting the price as well is not okay.
Decentralized exchanging exists. Use LocalBitcoins. The very meaning of decentralized does not require a huge exchange platform. Exchanges are in it to make money, not play trust games for fun and the love of BTC.
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This type of activity isn't anything new. A bit of digging into the NYSE and you find that the NYSE has had many problems in the past due to trading on its own exchange. I'm not condoning it; just saying it happens.
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Coinbase data mines the shit out of its user base. NYSE (a public clearinghouse) injects fresh capital into Coinbase to offer its support. Coincedence? I think not. NYSE is grooming Coinbase as its new foray into digital clearinghouses. As a side note, coupled with the NYSE investment, I'm sure Mr. Pandit is still butt hurt about Citigroup. What a better way to get back in the running than to take sweet revenge on your old banking buddies via BTC...
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They paid that because they did their sums and were confident they'd get a return. They would've paid 300 billion if they were confident they could get a load more back. That's a little harder to gauge with BTC.
So, did the NYSE do their sums before investing in CoinBase? I don't see them getting a good return without the bitcoin exchange rate increasing a hell of a lot. I assume they're looking to the future, but there's plenty of money to be made in the turnover of BTC as well. You could have a very busy economy with a relatively puny market cap with the way it's running at present. The coins are effectively acting as tokens for USD when it comes to most merchants. They make their money facilitating that conversion. Yep, NYSE is definitely looking to the future. My guess is the injection of capital from them is not a profit driven investment yet, but a foundation for future business. The NYSE is a giant clearinghouse made up of some of the world's largest banks and traders. My ideas for BTC lie in the establishment of a new digital asset-based platform for the commodities market. These clearinghouses make a large profit off trading. I'm willing to bet they want their piece of the blockchain technology for the future. |
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Once they dump their bags on the exchanges and abandon Bitcoin for something better ... the small people are left holding the bag.
I am starting to see a lot of people going on about "bag holders" on the forum. As if they are all reading from the same script. My theory: most bought last December-January, and are upset Bitcoin lost over 70% of its' value. I still think it will go over $10,000 per coin. No idea if it will be anytime soon though. ^This What we have on this forum is a bunch of butthurt 20-somethings who "invested" some cash (or credit) just after the ATH in 2013 was reached looking to get rich. The price will climb once more, I'm just not sure everyone "invested" has the luxury of waiting. |
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IMO, I don't think the price of BTC will ever be correlated to its stability unless there are regulations in place. It doesn't matter if there are 10 coins available or 21M; as more fiat money is dumped in (assumption), the price will rise (perhaps), but this does not equate to long-term stability.
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It was really really hard over the last days not to panic sell. I wonder how many people sold around $170 and are now buying back, panicking. Maybe we'll go back into the $100s again, just so they can lose some more coins. It's sad, but this is how the human brain works. It's not always on our side.
You and I both. I sold and took a large profit after the $1000+ pump and then re-bought back in at $500 with principle and post-pump earnings. Needless to say, it's been a rough year and with the recent declines, it's even harder not to pull the sell trigger. Making money on BTC is nice, but I got in initially as an investment store for extra cash I was tired of making .0000000001% on through my savings account. I don't worry as much about the price as I do the exchanges folding and with few places to spend it yet. I'd really like to see the infrastructure grow to use it. I hear Uber may be collaborating with Coinbase... If bitstamp had done a gox I bet all the clever traders would have wished they had held in their own wallets. I would rather take a virtual loss when bitcoin's price tanks than lose the lot in a folding exchange. Absolutely. My coins are kept in my own personal wallet. No way would I trust them to anything or anyone else. As for the exchange, I was inferring about them folding and me having no where to buy them (besides locally) or no where to buy merchandise from large scale retailers (most companies go through an exchange instead of processing the transactions themselves). |
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