When I see people getting hung up on Rothschild... 

Fractional reserve banking was a significant development, sure. But it's not like he had invented something uniquely complex, like a formula for the cure for cancer, and he had it all in his head and never wrote it down, and if you wanted the cure, you had to pay him whatever he asked, and he'd go behind a curtain and make some for you, where nobody could duplicate it and the secret would die with him.

Fractional reserve banking is a bit counter-intuitive and abstract, but it's nothing that anyone who can handle high school algebra should struggle with for long. Nor was it an unobtainable secret.

So once you understand the basic idea that is making him such a big shot, and he's trying to steal your country, why wouldn't you just kill him and have your own people do the same thing?

Well you can be a federally chartered bank, or a state chartered bank. It costs millions in capital either way.

So...you're saying you're just going to avoid handling dollars and other 'real money' to avoid all that?  Do you have lawyers? I can't believe they'd tell you to just wing it. Even if bitcoin is not legally money, it is probably something like a security.

I'm not a lawyer, but you don't even seem to have a legal disclaimer anywhere about you not legally being an actual bank, unless I'm missing that link.

hmm on point though, I can see how that actually is more like something a lady person would get her boyfriend to spend his bitcoins on rather than spend her own bitcoins on.

and there are a bunch of good ideas in this thread...and the most basic idea being that the bitcoin community needs more merchants is right on this point and has been brought up in other contexts...

Bitcoin does seem to need a 'business lead' as others have called it, to make the most of the ideas here. I'm not sure what to do other than just emailing merchants etc and saying 'hey, accept bitcoins, how 'bout it?'

Oh come on, plenty of women obviously do like it. That they don't have to buy it for themselves is just a consequence of men also liking them in it.

Would you claim women don't like alcohol because men buy them drinks?

I notice you are claiming to be a bank. Are you really, legally a bank? I don't see anything on your site to indicate that you are...

I'd like to see a page of legal speak which at least seems to indicate you know what you're doing and won't be shut down by the government for claiming to be a bank when you are not legally a bank.

At this point, you look like some guys who don't have a clue about the legal environment of banking and just decided to 'open a bank' as a business. If that is not the case, you really should have some more information available to indicate that.
 

Several people have suggested clothing, shoes, handbags etc...

A perfect match exists. It's called etsy.com

They are a site for handmade and vintage stuff. Most of the merchants are some girl or guy working out of their residence.

I have no idea whether or not or how one could convince etsy.com to accept bitcoins, but if it meant increasing sales, I think most any of those merchants would go for it.

I think it works like ebay in that they pay some money to etsy per sale, so given etsy's terms, I'm not sure if they'd ever be able to do it through etsy itself or if they'd want to sneak around etsy and make a deal through some other channel.

It's not just clothes and purses and shoes. They have a nice selection of hand made glass uh tobacco pipes. And other cool stuff.


This thread so embarass...

Here's why it matters.

A better question is, is it sustainable? And the answer seems to be...nope, and it won't last much longer. Most of the pools are shrinking while BTCGuild, Deepbit, and Slush are looking like they are going to be the only winners.

One crazy thing about the bitcoin community is that the 'clever' guy is more common than the 'average' guy. Or you could say, the average guy for the bitcoin community is a clever guy.

It's funny...I'm not at all an expert on academic approaches to ethics and morality, but one of the famous ideas from the field does apply here: Kant's categorical imperative. Basically, 'what if everybody did that?' Generally, a clever guy can say 'well, most people aren't clever so we don't have to worry about that nyah ha ha!' But the bitcoin community doesn't work like that.

What if everybody mined for a while on a small pool, then jumped off before the block was finished? A plague of grasshoppers...

Well, it is working more like this: what if the majority of miners did this? Then the minority of honest miners would gradually leave for bigger pools. When the hoppers come back for the next round, they find a major reduction in the pool's overall hash rate. Some of the hoppers look at the trend in rates and decide sensibly that it's not worth coming back to this particular pool at all next time. It's a death spiral.

The small pools seemed to be doing ok when it was still a few days avg per block. Now that it's about a week or more for a lot of them, they're falling off.

Can they change their payout structure and survive? Maybe...but maybe not. It'll be challenging for a pool that has lost a lot of its average hash rate to get people to come back. How should they do it?

Is this basically the same sort of little keychain thing that some MMO's use for account security?

You can usually get a 'free' one if you buy the collector's edition. Of course, it's not exactly free. When you add up what you got in the Collectors edition and how much it cost the company probably, you paid more. But at least you don't get ripped off as much as if you just bought the security fob from them standalone. And the thing is, most people won't even think to do a little hypothetical math about costs and what they've already paid. They will just get the security dongle in the CE and think yaaaay CE is so cool look at all this suff I get woohooo.

Think about it...that's just for stupid MMOs.

So...Mt Gox really should obviously consider the customer service angle.

1st, it's probably better for them to use a 'generic' supplier in China rather than a brand like Yubikey. For the people they do charge, they could charge less and make more money.

2nd...give it to your good customers 'for free.'

As in, don't send one for free to every dink with 10 BTC and $100 in there.

DO send one for free to every dink with say, 100+ BTC and $1000+ in there.

Or whatever the numbers are. They have big fees. Some customers have paid a lot more in fees already than the real cost to MTGOX of these security fobs/dongles/whatevers.

So yeah this thread is basically right except don't give them away to just anybody. "Give" them away to customers who are worth it.

If they had taken the route of dealing with a generic Chinese manufacturer, it should only be a few $'s per customer. They could then charge the rest of their customers less money and yet make more profit on the endeavor.

O rly?

Give it time. Nothing generates more radioactive elements than stars. The sun will itself easily generate far more radioactive elements than will all the nuclear fission reactors earth will ever use, combined. Just give it a chance.  

Sure maybe, who knows, but I really don't think so.

There are plenty of miners who got in before Bitcoin was at even $5.

Somebody had a large ~10,000 coin 'buy wall' up at ~$15 yesterday.

The point of a 'buy wall' is not to buy 10,000 coins at $15, it's to force people who want to buy coins to pay more than $15 and help drive up the price.

However, it fails if somebody says 'wow, I can sell 10,000 coins for $15, that's $150,000...I can't leave that money on the table, I just have to do it!.' Then the guy with the 10,000 coin 'buy wall' now has bought 10,000 coins for $15 each.

Maybe it was one somebody who was an early adopter and has way more coins still. For that kind of guy, taking the cash when the opportunity presented itself while still having a lot of bitcoins is a great idea. Or maybe a speculator was able to get completely out. Who knows.

I don't know, either way it doesn't seem all that...unexpected, wild, crazy, suspicious or whatever to me.

What they are trying to do is force the people of Indonesia to use the official local currency, because if they don't then it isn't worth a damn.

The government of course has a different set of rules for itself.

Indonesia hates the dollar so much they sell bonds backed by dollars lol.

Would you want to buy a bond backed in some local currency without even a 20 year history of stability? Well, generally the answer is no. So they sell bonds backed by dollars.

Would you want to keep your life savings in a currency like that? No. While it's not illegal to hold dollars, consider that if you are holding dollars you wouldn't bother to exchange them to make a purchase if you didn't 'have to.' You lose money on fees whenever you exchange currency when you are 'the little guy.' You do not get 'the market rate.' If it wasn't a good idea to use dollars at the individual level, they wouldn't have the draconian laws trying to stop people from acting in their own immediate self interest.

Also, whether you are from Indonesia or if you travel to Indonesia and want to exchange dollars, they will give you less money the older and wrinklier etc the bill itself is. So that's another way you lose by exchanging. They do this because unlike US banks, they can't just trade old bills for new bills.

It all helps the government acquire and hold lots of crisp, relatively new dollars, which of course they need for those dollar backed bonds they sell.

Well if the question is...how do you get a computer network that can hold and trade money with banks, the answer is that you pretty much have to be an actual bank.

There are onerous capital demands, especially for an industry that lets firms 'create money.'

But I suspect the typical internet solution to 'hey we need a big stack of money' could work.

Namely, instead of one guy with a hundred thousand dollars, you get a hundred guys with a thousand dollars.

Namecoin would need the same basic strategy. They'd need to get a bunch of people to buy the .bit domain, as a non profit or for profit company. Then they can have it hook up with the namecoin project.

The early adopters of each project have a lot of incentive to participate. To basically, 'double down.'

One advantage would be that by being in control of key infrastructure, they'd be in a position to safeguard their Bitcoin and Namecoin holdings against future replacements.

Say in ten years there are several new crypto currencies and they are gaining in adoption because of superior features. Well, say then that the '1st Bitcoin' decides to pick one of those currencies to start accepting for direct exchange to other currencies. The one they pick gets a huge boost and gradually becomes the successor to Bitcoin maybe.

It's worse for everybody if the US misses even one debt payment.

Whenever a country has done this, their currency crashes.

Defaulting is our fast track way to be Zimbabwe.

If you think a little inflation from more debt is worse, you're crazy. Look at prices from the 70s, 80s, and 90s. The change in nominal prices isn't really what is worse now compared to then. That much is business as usual going back a century now.

A little inflation privileges the now(current production aka people living and doing stuff now) over the past (aka debts of the past).

The USA just needs to stop being Mr Nice Guy aka everybody's bitch, and start playing the game the way we used to play, because that's how everybody else plays now. We forgot about it and got caught up in crazy dreams like 'globalization' and other BS.

Sort of...

At the very least,  as soon as sites like Wall Street Journal and Forbes were aware of BTC, what the average user here needs to understand is that the very very serious money sharks were aware of BTC.

Some of them were aware before those articles came out, and many many others became aware because of those articles.

Even before the mid-May explosion in interest, if you look at google trends, you see that San Francisco was very hip to BTC. While there is possibly some connection to drugs and prostitution, San Francisco is also a major banking center.

Fighting it? Mayyyybe. Exploiting it? Expect that. This particular PC mag article is probably just some overworked and underpaid content farmer who has a word count to hit and is too overworked and underpaid to give a damn at that detailed a level. The MTGOX attack/hack is more suspicious to me because it happened through their auditor.

You're closing in on the idea that was probably the most significant to the history of banking after the invention of money itself.

Fractional reserve banking.

To the extent that an exchange like MTGOX is being used as a place to just park funds, they are in a position to do that. They have both a cash reserve and a BTC 'reserve.'

For example, they could invest some of the cash deposits and earn interest. Some of their depositors money probably already sits in something like a savings account generating interest for MTGOX. A somewhat more aggressive approach would be buying things like bank CDs with a slightly higher interest rate, which could be sold in a short amount of time if they needed the cash to cover depositors demanding their funds.

They might also explore the idea of making 'Bitcoin loans' but that is probably a bit too ridiculous for them to consider at this moment, given all that would have to be involved in the process for it to work, and that they clearly have their hands full for the time being.

calista, don't kid yourself, legally it is theft.

http://en.wikipedia.org/wiki/Theft

Especially take note of the parts about actus rea and mens rea.

I'm also pretty sure that based on your post you could be compelled to identify him.

Given that as part of the cleanup of the MTGox situation, people will be watching this forum, it's probably a good idea for your friend to give it back before they or the bean counting catches up with him(and you).

Even if you hadn't posted here, there's a pretty good chance they'd find the error as they continue to make passes over 'the books' as part of reconciling all the accounts, transactions, etc.

Simply ditching an account and making a new one wouldn't matter unless he has been hiding his IP and such. They'll have logs and so will his ISP.

Most of the time, people talk their book.

https://swepool.net

It may just be a killer block...

It may also be that somebody is/was doing the thing where they withhold solved blocks just to screw the pool. Why would they do that? Well...swepool.net isn't that big of a pool. It does have a nice fee structure. Otherwise though it doesn't really make any sense for somebody to waste hashing power just to attack a pool. There's nothing rational that could be accomplished, so it's just dickery, if that is what is going on. And it's a very beatable thing with a little help.

In any case, the hash rate was up around 70GHash/s when all was well and normal...but people started jumping off when the block hit ~24 hours and then the difficulty changed...then people saw the rate decreasing and they left too.

Currently they are down to 11.5GHash/s.

In any case, even if you like your current pool, it should be very easy for people now to set up another .bat file, and it's good to have a few pools ready to go. It should take like two minutes to set up.

They have a nice fee structure, nice little setup overall, and they just need to break out of the death spiral they are caught in with the block that isn't being solved and the people jumping off.

In the underroos of many a groggy miner this morning.

They are exorbitant compared to a typical checking or savings account, or for using a visa card, that's for sure. The service is more involved than that, of course.

Meanwhile, MTGOX is/was pulling in ~$40,000 a day recently by some estimates.

Across the field, expect fees to come down to be more in line with the relatively low costs of running the service, because more markets already have or are coming online, because it has been so wildly profitable recently. It looks like a good business model in a time when those aren't easy to come by, and the profits can get a whole lot more modest before you'd get down to the 'why bother' level.

For now, I'd expect there to be quite a few people like the OP, who will take notice of the fees, and look for an option with lower fees, and find one, and eventually MTGOX will have to respond with decreased fees and/or better or expanded services.

Probably nobody has made more cash money in the recent BTC rush than MTGOX. Some people are/were worth more on paper...but MTGOX is making cash. Deepbit is probably making pretty good money, but then again, how much is held in BTC and how much have they gotten in cash?

I do agree with twist3d1080 above me...but business is not a sentimental endeavor.