I found this blood pressure raising thread from a banking forum that I read

OP

I know there are some topics on Bitcoin but I wanted to ask anyone willing to participate what they thought about Bitcoin?

What are your concerns and do you think those concerns can be addressed?

Here is why I am interested. Years ago I helped start a small payments company that is now relatively ubiquitous and almost part of the internet culture. I think...

During those early crazy days, I remember going to industry conferences and hearing hushed whispers about us when we'd walk through the crowd. All sorts of rumors prevailed and one of my responsibilities was to help allay the fears of bankers and law enforcement. And ultimately I think we did a good job and built a truly world class system for investigations and AML/BSA/OFAC monitoring.

I find myself in a similar situation now and I am excited about the challenge. I think we are building a Bitcoin group that will hopefully knock the socks off the industry and will more importantly bring about the same trust and cooperation I experienced back in 1999-2002 in my previous company's "early days".

So please let me hear it what is it about Bitcoin that has everyone so concerned. So is obvious but I want to see for myself. I have already started working with federal law enforcement on some areas relating to this and know their concerns.

So let's chew the fat (just not my fat pls)

John

First reply from a self confessed bankster

Well, considering I have been a banker my whole life and I absolutely have no idea what a bitcoin is, except something that is digitally created and it supposedly has some worth, I guess I am not sure of any need to create an unknown and totally unregulated form of exchange. Maybe I am just old, but what is wrong with old fashion currency and credit cards unless you believe the conspiracy theorists regarding the fallacy of the current economic systems. They say they can't be counterfeited. I find that just a little beyond believe as everything is scammed sooner or later.

Personally, if the world comes to an end, I think I will stay with my gold coins over digital money when the electricity goes out.

So this life long banker thinks 50% youth unemployment, 0% interest rates, high inflation and insane asset bubbles only exist in the realm of conspiracy theories? What a self loving kunt 

What's it going to take before these people see the harm that they've done to the world 

http://www.londonreal.tv/episodes/max-keiser-bitcoin-bernanke-buffett/

Max Keiser of Russia Today drops by to explain the genesis and implications of the digital currency Bitcoin, why The Federal Reserve and the banking system should apologise to the people for manipulating interest rates, how Warren Buffett is complicit in the Mexican drug trade by purchasing Wells Fargo, and Max’s crazy times in the 1980s as a New York City stockbroker by day and punk-rock party animal by night.

Super podcast featuring a tour de force from Max Keiser. They spend most of the hour speaking about Bitcoin but Max also drops in some nuggets about Krugman fellating Bernake and the CFTC guy wanting to be a stripper  

There's also a brilliant movie plot about an options trader sitting at his desk in the WTC on Sept 11.

[Co-op rules out state aid as boss quits amid capital fears]

For UK bitcoiners.

In case you missed it today,

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/10049762/Co-op-rules-out-state-aid-as-boss-quits-amid-capital-fears.html

Co-op rules out state aid as boss quits amid capital fears

The lender, which is part of the Co-operative Group, announced that Barry Tootell had “chosen to step down” with immediate effect, a day after the bank’s credit was downgraded to junk status by Moody’s.

Mr Tootell was said to have “decided that the time was right to stand down” because he had been running the “Verde” deal to buy 632 branches from Lloyds Banking Group which collapsed last month. The bank announced that he would be temporarily replaced by Rod Bulmer, the Co-op executive who had been driving Verde day to day.

The resignation added to a sense of crisis after Moody’s said the bank’s capital levels were too low and had been made worse by “substantial losses”, particularly in commercial property loans it acquired with Britannia Building Society in 2009.

The credit rating agency said the lender was “unlikely to be able to generate a significant amount of capital through earnings” so it would have to seek “external” help.

A major event you would have thought but it didn't even get a mention on the BBC 6 o'clock news! The powers that be must be wary of another Northern Rock situation so don't expect too much mainstream media comment on the situation.

The Co-op by itself isn't a major player but it's important for a couple of reasons. Firstly it's the private bank of the Labour party. All of the successful Labour election campaigns were funded through Co-op borrowings and many of the remaining trade unions bank there too.

Would the coalition be willing to bail out Labour and unions?

The second reason is even more worrying. All CHAPS payments are routed through the Co-op. If they go down in flames we could be looking at days of chaos where no building society can make any payments.

Fun times ahead 

[Bank deposits of over €100,000 may be at risk]

Bank deposits of over €100,000 may be at risk

http://www.irishtimes.com/business/sectors/financial-services/bank-deposits-of-over-100-000-may-be-at-risk-1.1384295

Proposals under Irish presidency to deal with European bank collapses likely to ‘bail-in’ large depositors

Deposits of over €100,000 are likely to be hit in the event of future European bank collapses, according to a proposal put forward by the Irish presidency of the European Council ahead of a key meeting of finance ministers next week.

Discussions on the controversial bank resolution regime, which is likely to see savers with deposits over €100,000 “bailed in” as part of future bank wind-downs, are due to intensify this week in Brussels, ahead of Tuesday’s meeting, which will be chaired by Minister for Finance, Michael Noonan.

“We will try to get some guidance from Ministers about the possible design of the bailout tool,” one EU official said yesterday.

Under a compromise text proposed by the Irish presidency, uninsured deposits of over €100,000 would be bailed in in the event that a bank is resolved, but depositors would rank higher than other creditors in the event of a wind-down.

Once this gets rubber stamped on the EU level we should expect to see the bankers and bureaucrats get to work quickly on the European periphery.

The Irish politicians will be pushing hard for these proposals to be passed. The so called pillar banks of the Irish economy (Allied Irish Bank, Bank of Ireland) need another €60 billion to cover non performing loans and that figure keeps on increasing. A deposit grab under the auspices of EU rules would be the perfect smoke screen for them.

[I know, government officials are not to be trusted and all that, but the truth is that Ben Bernanke’s promises that his actions wouldn’t be inflationary have been vindicated year after year, while goldbugs’ dire warnings of inflation keep not coming true.]

Typical central bank loving hatchet job from the man who thinks Ben Bernake knows best.

http://www.nytimes.com/2013/04/15/opinion/krugman-the-antisocial-network.html

What is bitcoin? It’s sometimes described as a way to make transactions online — but that in itself would be nothing new in a world of online credit-card and PayPal transactions. In fact, the Commerce Department estimates that by 2010 about 16 percent of total sales in America already took the form of e-commerce.

The similarity to goldbug rhetoric isn’t a coincidence, since goldbugs and bitcoin enthusiasts — bitbugs? — tend to share both libertarian politics and the belief that governments are vastly abusing their power to print money. At the same time, it’s very peculiar, since bitcoins are in a sense the ultimate fiat currency, with a value conjured out of thin air. Gold’s value comes in part because it has nonmonetary uses, such as filling teeth and making jewelry; paper currencies have value because they’re backed by the power of the state, which defines them as legal tender and accepts them as payment for taxes. Bitcoins, however, derive their value, if any, purely from self-fulfilling prophecy, the belief that other people will accept them as payment.

However, let’s leave that strangeness on one side, along with the peculiar “mining” process — actually a process of complex calculation — used to add to the bitcoin stock. Instead, let’s focus on the two huge misconceptions — one practical, one philosophical — that underlie both goldbugism and bitbugism.

The practical misconception here — and it’s a big one — is the notion that we live in an era of wildly irresponsible money printing, with runaway inflation just around the corner. It’s true that the Federal Reserve and other central banks have greatly expanded their balance sheets — but they’ve done that explicitly as a temporary measure in response to economic crisis. I know, government officials are not to be trusted and all that, but the truth is that Ben Bernanke’s promises that his actions wouldn’t be inflationary have been vindicated year after year, while goldbugs’ dire warnings of inflation keep not coming true.

I was willing to tolerate his bullshit until he made the inflation remark. My food and energy bills are up over 10 percent from this time last year. Also the skulldeggery from the Bank of England is keeping my housing costs sky high 

Krugman is full of shit. How did this cunt get a New York Times column. I want a New York Times column!

....when the EU freezes all Slovenian bank accounts according to the terms of a new bailout and the only way to withdraw your funds will be through Bitcoin.

http://www.guardian.co.uk/world/2013/apr/09/slovenia-eurozone-bailout-rumours

Discuss.

Note: I'm not implying anything against the integrity of Bitstamp, rather the integrity of the Slovenian banking system after a bailout.

Edit: Changed the price in title from $1000 to $10,000. $1000 seemed like a crazy price back in April. Not in December though 

Need some help guys. I loaded an old wallet into my client and tried to send some coins to a new address. I got the following error message

Code:

A fatal error occurred. Bitcoin can no longer continue safely and will quit.

EXCEPTION: St13runtime_error
CWallet::GenerateNewKey() :AddKey failed
C:\Program Files (X86)\Bitcoin\bitcoin-qt.exe in Runaway exception

I'm running version 0.8. The old wallet was last opened in summer 2012 in probably 0.6.

Thanks

Block #226035 is 617kB in size. Does that mean it's going to be orphaned by all the 0.7 nodes?

http://blockchain.info/block-index/358797/00000000000001ba4bd010816667d2706fc0ddb3b258835c7d40d2a8c4d2b6a9

[It's game over for the Pound Sterling.Huge budget deficits, pyramid scheme housing market, mounting inflation, massive real unemployment, suppressed interest rates, financial repression.....]

It's game over for the Pound Sterling.

Huge budget deficits, pyramid scheme housing market, mounting inflation, massive real unemployment, suppressed interest rates, financial repression.....

http://www.telegraph.co.uk/news/politics/georgeosborne/9889605/George-Osborne-no-let-up-in-plan-to-cut-deficit-after-AAA-downgrade.html

Moody's said it had acted to downgrade Britain for the first time because of “continuing weakness in the UK's medium-term growth outlook”, the risk that the Government will fail to hit its targets for reducing the deficit and the UK's “high and rising debt burden”.

No government has the balls or the incentive to make the reforms necessary for a recovery. Their only plan is to stick with QE. To keep the plates spinning for just a little bit longer they'll keep the Bank of England pumping ever more worthless pounds into the economy.

http://www.telegraph.co.uk/finance/economics/9886554/QE-may-need-to-be-raised-by-175bn-says-BoEs-David-Miles.html

QE may need to be raised by £175bn, says BoE's David Miles
The Bank of England has a case for restarting its asset purchase programme, and may need to increase it by up to £175bn if the economy is running substantially below capacity, a senior policymaker has said.

Raising QE by £175bn would mean the Bankrupt of England controlling more than 40% of the entire government debt market. Any small bump in interest rates and the whole sorry mess will go straight down the toilet.

Be prepared! Dump your pounds and start stocking up on food, gold and bitcoins. I dread to think what the country would look like with petrol at £5 a litre.

http://www.gq-magazine.co.uk/comment/articles/2013-02/07/silk-road-online-drugs-guns-black-market/viewall

Forget South American cartels and Russian arms dealers: the black market has moved online......


Want to buy an M4A3 assault rifle, a forged UK passport or a few grams of crystal meth and have it delivered to your door? On the dark web you can find it, on sites such as BlackMarket Reloaded, where AK47s are on sale alongside Afghan heroin, or CC Paradise, selling stolen credit-card data. You can even find dubious listings for contract killers (yours for £12,500, half up front). But the biggest digital black market-place of all is called Silk Road.

Silk Road - named after the ancient trade route between Asia and Europe - opened in February 2011. The site is similar to eBay or Amazon: users can sign up and buy and sell almost whatever they please. It has a rudimentary green-and-white design, but all the functionality you'd expect from a legal online marketplace: individual seller pages, buyer feedback, even an escrow system to protect against fraudulent vendors.............

They say when you're trying to catch a criminal, follow the money - which led GQ to a blandly lit conference room at London's Royal National Hotel on a weekend last September, listening to cryptographers and laptop economists talk about a currency that doesn't really exist. Bitcoin is a digital currency established in 2009 by another pseudonymous founder, Satoshi Nakamoto. The currency exists only online and transactions are encrypted, so that users can be anonymous. Rather than using named bank accounts, amounts are transferred between web-like addresses called "wallets". Coins can be traded for real-world currency at online exchanges. While the exchange rate has fluctuated wildly, at the time of writing one coin is worth about £7.50, valuing the total number of Bitcoins in circulation at around £75m.

A non-sensational write up about how online black markets have progressed from the Farmers Market thanks to Bitcoin. They even get a few one word email answers from Dread Pirate Roberts!

[It added that accepting Bitcoin - an electronic, hard-to-track currency - had not been an option because it was "just too hard for 90% of people"]

Article about Newzbin2 closing after legal and financial trouble.

http://www.bbc.co.uk/news/technology-20540853

Newzbin2, once one of the web's most popular sites offering links to pirated content, has decided to close.

It comes 15 months after a UK court ordered internet service providers to block the site, and amid global pressure from copyright holders.

Internet rights groups said the move was "pointless" in stopping piracy.

In a statement, Newzbin2's owners said it had struggled to cover costs because payment providers had "understandably lost their nerve".

"Newzbin2 was always hoped to be a viable underground commercial venture," the site said.

"The figures just don't stack up."

................................

"All our payment providers dropped out or started running scared," the site said.

It added that accepting Bitcoin - an electronic, hard-to-track currency - had not been an option because it was "just too hard for 90% of people".

Pretty pathetic that they wouldn't give Bitcoin a chance even for the 10% of their customers who "got it".

The third richest man in South Africa did a business deal in the 1980s involving diamonds, cash and safety deposit boxes. Fast forward to 2009 and the proceeds from the deal (£700k) are confiscated by UK customs as he boards a flight from London to Luxembourg. Customs didn't have any evidence or suspicions that the money came from crime but they took it anyway and now an appeals judge has effectively given the okay to this theft by deciding to delay any ruling to an unspecified time in the future.

http://www.dailymail.co.uk/news/article-2165025/Its-just-peanuts-Why-South-African-billionaire-denies-criminal-activity-boarding-plane-700-000-cash.html

£700k is a lot for the Bitcoin economy at the moment but I think within a year there will be enough depth to buy thousands of pounds worth of bitcoins in one location and sell them for cash in your desired location. After only a couple of weeks localbitcoins.com shows enough traders to exchange up to £1500 cash in the UK for bitcoins and then sell them in Switzerland for CHF.

On the MtGox GBP deposit page there is a polite notice stating that,

Direct cash deposits should not be made, as they may not be credited

Does this mean that they no longer accept cash deposits or is it just a warning that if you lodge cash there is a higher chance of error? I've deposited cash in the past and it all went smoothly. If you tell the cashier to input the transaction message I can't see what could go wrong.

[Online bookie can't scoop £50k losses made by 5-year-old. High Court rules the website contract terms were unfair]

Online bookie can't scoop £50k losses made by 5-year-old. High Court rules the website contract terms were unfair

http://www.theregister.co.uk/2012/05/31/high_court_rules_against_bookmaker_in_online_betting_losses_case/

A man who blamed his girlfriend's five-year-old son for making loss-making trades in expensive natural resources through his online betting account is not bound by a term he agreed to on the bookmaker's website, the High Court has ruled. The term stated that an accountholder is deemed to have authorised all trading made under his or her account number.

....

Spreadex based its claim on a clause in its contract which meant Cochrane would be "deemed to have authorised all trading under [his] account number," a report by legal information service Lawtel said.

However, in rejecting Spreadex's bid for a summary judgment, the High Court said that the clause was not legally binding because it didn't form part of a binding contract and was "unfair". Spreadex was not able to show that Cochrane entered into a separate contract for each trade made via his account and as such the company's general contract applied.

.....

This is an odd case," gambling law expert Susan Biddle of Pinsent Masons, the law firm behind Out-Law.com, said.

"It is hard to see how companies can incorporate general terms into future contracts with consumers – unless this case can be distinguished on the basis that the problem here arose because of the total exclusion of Spreadex’s liability in contrast to the consumer’s unlimited liability. If Spreadex had accepted some liability and/or capped the consumer’s liability the contract may have been deemed binding," she said.

"I would not advise businesses to purse summary judgment applications where contract terms are disputed as unfair and the reasonableness of them is at issue, especially when it involves a consumer," Biddle added.

I know Bitcoinica screwed up in lots of different ways but at least this never happened.

Bitcoin is NOT a Currency

Etsy Labs Brooklyn, May 14th 7pm

Nerds LOVE Bitcoin. It's technologically and cryptographically fascinating. http://en.wikipedia.org/wiki/Bitcoin

But is it actually a currency? Kenneth Bromberg, lead programmer of Bloomberg's foreign exchange platform, will explain what actually makes something a "currency", why Bitcoin doesn't fit that definition, and why it therefore doesn't trade on the global currency exchanges.

http://www.meetup.com/BK-Tech-Talks/events/55386052/

Would anyone in the area like to go to this and counter any FUD this guy comes out with?

This is the FBI criminal complaint against the guys who allegedly wanted to attack something somewhere

http://www.cbsnews.com/htdocs/pdf/Wright_complaint_affadavit_050112.pdf

page 6, article 27

During this meeting WRIGHT and BAXTER talked about getting the Anarchist Cookbook but that they have not downloaded it because they do not want to be tracked online. The group then talked about a computer program you can buy for fifteen dollars a month that keeps people from tracking you on the Internet. They discussed using pre-paid debit cards or anonymous online accounts that use alternate currencies as a proxy for real dollars like "bitcoin" accounts to buy the program without leaving a traceable financial trail. BAXTER explained that he has a friend who is a hacker and can transfer paper money to bitcoins. He stated that you need some proxy to do it and both BAXTER and WRIGHT tried to explain how the bitcoin system works

I wonder if Baxter and Wright ever posted on this forum 

I came across this paper on Twitter

"Two Bitcoins at (sic) the Price of One? Double Spending attacks on Fast Payments in Bitcoin."

http://eprint.iacr.org/2012/248.pdf

Their strategy is to cheaply double spend a coin by using friendly hosts to spread the malicious transaction. They've shown it to work without being detected for approximately 10 seconds, enough time they believe for you to run away from Starbucks with your coffee.

Is this really a problem for fast transactions? I've used fast transactions (Bit-Pay, Coindl and Bitcointorrentz) and they already cautiously wait for around 10 seconds before confirming payment.

["The idea that they're going to get a VC-like return in bitcoin-based projects [is ludicrous]."]

http://arstechnica.com/business/news/2012/04/coinlab-gets-500000-in-vc-for-bitcoin-related-gaming-startup.ars

Same as the other stories but a quote at the end from an "expert" in the payments industry needs to be saved for posterity 

"Frankly, it makes no sense to me. But that doesn't mean its wrong, just that it makes no sense to me." wrote Ronald J. Mann, a law professor at Columbia University and an expert in payment systems, in a Wednesday e-mail sent to Ars. "The idea that they're going to get a VC-like return in bitcoin-based projects [is ludicrous]."

Saw this tweet while searching for Bitcoin

Michal Kisiel ‏ @finnovation
Got surprising message - European Commission Payments Committee asks for opinion on regulating #bitcoin

Has anyone else been approached for an opinion? I couldn't find a list of members for this committee but a closely related body called the Payment System Market Expert Group is full of Visa/Mastercard/Paypal "experts"

http://ec.europa.eu/internal_market/payments/docs/psmeg/psmeg_nominated_public_en.pdf

More info here

http://ec.europa.eu/internal_market/payments/advisory_groups/pc_en.htm

Can someone from the University of Ottawa give more info on this story.

http://www.metronews.ca/ottawa/local/article/1122713--student-in-battle-with-u-of-o-over-his-currency-proposal

A University of Ottawa student was found guilty Monday of escaping lawful custody in April after he ran away from campus security guards onto an OC Transpo bus while handcuffed

He was charged with mischief, breaching the peace and escaping lawful custody, but the first two charges were dropped, he said.

The judge in his trial heard about his “Blinky Blinkies” — a form of currency similar to the Internet-based currency Bitcoin — because security guards testified that he was throwing them to a crowd of students when he was arrested.