This there are no stable small markets.  None.  Ever.  They simply don't exist.   Stability comes from deep markets and deep markets come from large markets.  There isn't going to be (relatively) low volatility until the order books are so deep it takes billions to move the exchange rate 1%, and that isn't going to happen when the entire money supply is only valued as a couple billion.

If you want to predict future volatility, take a look at silver chart.  Silver is a ~$30B market.  For Bitcoin @ 15M coins (~3 years from now) that would be $2,000 per coin.  When Bitcoin's long term average (say 30 VWAP is > $2,000) it likely will have volatility similar to Silver.   Want less volatility well the volatility on Gold is roughly a quarter of that of Silver.  Gold is a $7,000 B market.  For Bitcoin @ 20M coins (~11 years from now) that would be $350,000 per coin.

Not saying Bitcoin is going to $2,000 or $350,000 just putting some context on "stable".  There are NO (not now, not every in history, will never occur in the future) small stable markets.  

What is strange is that is not the correct MSB classification (at least not since FinCEN "clarification" in March).  FinCEN has deemed that exchangers of virtual currency are money transmitters*, also an MSB but code 409.

http://www.fincen.gov/financial_institutions/msb/definitions/msbKey.html

Maybe Forbes just got it wrong.


* For the record I think this is trying to put a square peg into a round hole and FinCEN should have done it properly by going to Congress getting Congressional approval for creating a new class of MSB related to virtual currency exchange with regs that actually deal with virtual currencies instead of trying to use an existing unrelated classification (with a host of regs which are either nonsensical or pointless when applied to virtual currencies) but that is water under the bridge at this point.

IIRC the admins/mods resisted making an alt-forum however the never ending alt-coin spam in the "main forum" finally lead to the creation of the alt subform.  It makes moderation easier.  Much like the reason why most forums (this one included) have an off-topic subforum.  Sure you can say in the rules off topic threads will be deleted but honestly everyone knows some % of the members will ignore that and then it turns into a debate on what is off topic.  If a thread comparing Bitcoin to xCoin off topic?  What about discussing an attack on xCoin which could also be made on Bitcoin?

Of course you can bring down the mod hammer and go forum nazi.  Auto-delete even marginally off topic threads, quick bannings, etc but that leads to more work as people create threads about the deleted threads, or create new forum accounts to protest their account getting banned, etc. 

In a perfect world people would use xCoin forum to talk about xCoin and that would be it but if you have ever had the "joy" of moderating a large forum you already know it isn't a perfect world.

TL/DR:  Forum members generally suck (at least some %) and they make moderators lives miserable.  Things like "alt" subforum and offtopic are a place to dump the trash.

How can they get away with raising taxes only on the "rich" (quotes intentionally because it is always poorly defined) to pay for increased spending which mostly benefits the "non-rich"?  Easy, people are selfish, shortsighted, and greedy.  Modern day career (lifetime) politicians are masters of exploiting those characteristics. 

Most working class people didn't have any significant gold bullion in the early 1900s and if they did they sold it (likely to already insanely rich people) during the depression so they wouldn't starve.  The rich had bigger problems to worry about.  There was serious talk about nationalization of wealth (aka communism) in the 1930s.  Having to sell some coins to Uncle Sam is a small price compared to suddenly all your wealth is owned by "the people".

It would be like the government today saying private jets or residences valued at more than $20,000,000 are prohibited (or slapped with a punitive excessive wealth annual tax).  How much of an uproar would that cause?  Divide and Conquer has been a tool of subjugation for the state for a couple thousand years and it still works just as well today.

There is no such thing as first.  The network is non-deterministic.  Trying to enforce that rule would simply make it trivial to fork the blockchain.

Scenario:
Attacker creates two tx A & B.  Tx A pays merchants, Tx B sends same coins back to attacker.  To execute a 0-confirm double spend the merchant must know about TX A ("see it on the network") however the attacker will also send Tx B to some nodes.  Now at this point the network lacks consensus.  Some % of nodes believe tx A is "first" and thus "valid", they will drop tx B and not relay it.  For some % of nodes the opposite is true.  Now say a miners solves a block, with either A or B.  By your proposed rules some % of the network would see that block as invalid.  The network would split.  If there are mining nodes on each half of the split then they will extend their chains

TL/DR version:
proposals like this always fail because they look at the "network" like it is a single entity.  There is no "network," that is merely an abstraction.  There is only a collection of independent connected nodes.  At right now at this very second, all the nodes of the network are NOT in consensus.  They have differing tx in their memory pool. Due to various relay/drop rules related to fees some nodes may NEVER know of a tx until it is included in a block. In the case of a double spend (accidental or intentional) some nodes have incompatible transactions they each see as "valid".   

The purpose of mining is to force a consensus among the nodes.  Period.  Thus mining has to be deterministic.  Given a block all nodes must ALWAYS reach the same conclusion on its validity.  If they don't then an unintentional hard fork will occur.

Bitcoins are not legal tender in the United States (or anywhere for that matter). 

Courts award damages in legal tender.  If I wreck your priceless antique car the courts can't force me to find another one, they can't however (if they find I am liable) award you damages in the value of the car. 

Courts ONLY award damages in legal tender.  If two companies had a dispute over gold, or computer chips, or barrels of oil the damages would only be in legal tender which for these United States is the Federal Reserve note.

Update: more bank funds available. 

You were using 2FA right?

Rhetorical questions as these events which happen on an almost daily basis never involve 2FA.  To any noob reading if you don't use 2FA you are one malware, 0-day java exploit, or phishing attack from losing your entire bitcoin savings in a split second.

We asked and of course we care, we spent a significant amount of time an energy integrating our backend with theirs.  We were given no specific reason, no appeal, no details.  I even made some personal phone calls to contacts within the bank, contacts who in the past were very helpful only to get canned responses about accounts can be closed at the discretion of the bank at any time for any reason without appeal. I have some theories but they would merely be speculation.  My understanding is that this isn't unusual just about every bitcoin related company has dealt with similar issues in the past (and likely will in the future).

You can't place an order to sell unless we have available funds to pay it. 

What guys?  Are you a citizen?

I think the better questions is ... why would he?

Or not.  You likely are understimating by a couple orders of magnitude the cost and complexity of such an operation.  To become a citizen of Tuvalu (and most nations have similar requirements) you must be a resident for seven years AND renounce your existing citizenship.

Not that easy to convince people to move to the ass end of nowhere at huge personal risk for hope that in a decade or so they will be able to form a capitalist utopia.  Many citizens of an existing nation (poor or not) would not want mass immigration and would move to slow immigration and citizenship.  To make it worthwhile for existing residents they have to also believe their lives will be improved.  That means lots of spending on infrastructure, airports, schools, etc.  Just the advocacy and planning stages would require significant investment and residency.  Would you move there in the hopes some crowdfunded group on a forum didn't decide to get board and stop funding three or four years into the process.

An optimistic scenario would be a group of extremely wealth people, tens of billions of dollars in capital, and a decade or two.  It isn't something you are going to crowdfund.  It would require enough financially independent people capable and devoted enough to take the risk of moving to one of the poorest nations of earth and work tirelessly for the next decade or so to  reform and modernize it from within.

The Pitcairn islands are not sovereign.  They are an overseas territory of the United Kingdom.
https://en.wikipedia.org/wiki/United_Nations_list_of_Non-Self-Governing_Territories#Current_entries
 

This.  There are some very small (very poor) nations where say ten billion dollars could likely buy you enough power (and immigrants = votes) to "reform" the local government into whatever you wanted.

For example Tuval has a population of ~10,000 persons, a GDP of $36 million and yet is recognized as a sovereign nation by just about every existing nation and the UN.

Land is the one thing for which global demand (on any extended timespan) is always increasing  and nobody is increasing the supply.  A country will gladly give you deed to land UNDER THEIR SOVEREIGN RULE however countries generally do not willingly party with territory.  Nations are a sort of "good ole boys club" with no vacancies available (without the use of force)*.  It is the obvious "oversight" entities like the UN deal with interactions between existing nations however they almost intentionally pretend that all these nations have always existed and will always exist and no other nation has ever or will ever exist.  For all the pomp and diplomacy nations are formed by violence. 

This covers the issue pretty well
http://www.worldislandinfo.com/Starting%20island%20country.html

The only likely scenario for creating a new nation would be geoforming a new island in international water (which is very deep).  We are taking an engineering project to rival the best the human race has accomplished and something on the scale of tens of billions of dollars, millions of man hours, and years (if not decades) in the making.

A more plausible shorter scale scenario would be a very large ship (i.e. floating nation) or other manmade structure (deep water oil platform) or possibly a seastading community using a platform as a "home base" of sorts.


* In the last sixty years the only "new" countries were either nations where the existing government fell and was replaced by a government under the name of a new nation or nations which split into multiple new nations (i.e. Yugoslavia) after years of internal conflict.

Are you planning on building an artificial island?
There is no land* which isn't the land/territory/protectorate of an existing country.

The major exception being Antarctica however the vast majority of existing nations have signed a UN treaty to prevent that land from being claimed by any existing or new nation.   There are a few unstable volcanic formations which may extend above the sea level but nothing capable of supporting even the smallest of communities (think rock a few acres large barely sticking out of the water).

You can buy a private island but that would put you under an existing sovereign:
http://www.privateislandsonline.com/

One example of a propsal to form a "free citystate" which however would still be under US federal sovreignty.
http://www.theblaze.com/stories/2013/01/28/would-you-pay-300000-to-become-a-citizen-of-this-proposed-free-market-utopia-in-detroit/
http://www.commonwealthofbelleisle.com/

Larger, deeper markets reduce volatility.  It occurs in every single free (or relatively free) market since humans began trading things.

Take a look at the volatility of Silver and Gold for example.  While both are more stable (relative to USD) than Bitcoin, Silver is much more volatile then its golden brother. 

Valuation of Bitcoin: ~$1B
Valuation of Silver:  ~$30B
Valuation of Gold: ~$7,000B

When it takes $1B or more to move the exchange rate 1% either way (like it does for Gold) you will not see 50% daily volatility. 

Another way to look at it is the total volume traded on the four largest BTC:USD exchanges is ~$6B annually.  The world GDP is ~$70T annually.  To keep the major currencies with relatively low volume how much forex volume do you think it takes?  Would $70T seem like a lot? Annual forex trade volume is on the order of $250T annually (yes 4x to 5x global GDP).

The headers are negibile so yes the tx volume limit is generally linear with block size.

I would point out that the US FedWire system is ~7tps and is used to transfer $600T to $800T annually.   It is possible Bitcoin is used more for large transactions and alternatives (to include alt-coins, off blockchain transactions, ewallets, etc) handle higher volume, lower value transactions.

Miners are compensated with block subsidy + transaction fees.  Over time the block subsidy will decline and tx fees will be more important.