LA Times - A lethal business model targets Middle America

Analysis from John Robb at Global Guerrillas

That said, face to face cash transactions are probably the best way to conduct business on the retail end, in my opinion. It's more anonymous than bitcoin and I see too many problems with mailing most drugs and geocaching is way to inconvenient. Wholesale transactions to retailers might be an option. It would cut down on the amount of cash lying around. There are already very expensive ways to launder and route money through the traditional banking system and a digital currency can out compete such methods on both price and ease of transaction. I imagine drug dealers will be late adopters, though, as they probably already have invested a lot of trust into the networks they utilize for procurement and payment.

/speculation

Man, if I got a penny for every spam message I've received....

In Portland it's a god damn cottage industry. I go for walks in the evening sometimes and smell soon to be harvested crops in the neighborhood. Lost your job? Grow pot until you find another one. B.C. bud drives the market here, but anyone with a little will can and will set up their own garden and sell it through a friend. It's all very civil. There's a culture of do's and don'ts, etiquette, etc. Don't ask too many questions, if you're a new customer you need a friend to introduce you, don't try to be a wannabe dealer by marking up dub sacks that you bought at retail prices. Hook up your friends, etc. I'm not a participant, but absolutely love to peak in on the market from time to time just to watch.

I've heard heroin dealing is actually moving in this direction, too, with friendly and safe door to door service, referral incentives, etc. A bunch of Mexicans from the same region are making a family businesses out of it and its threatening to disrupt traditional street dealing. I'll have to dig up the link.

Anarchist, but I wouldn't describe myself as an ancap or a leftist.

Nice! That would raise the price of sending 1,000,000 spam messages by about $10,000, right?

Free markets have moderated forums.

In the long run we are all fed.

The same way current currency issuers do: update their design using cutting edge technology and destroy old tokens as they can get their hands on it. As far as counterfeiting gold rounds; who cares as long as they are real gold? What's stamped on the face of a gold coin only matters in that it is a mint's brand and tells users that it is what it says it is, gold. Outside of that you can stamp whatever you want on the gold coin. Stamp BTC 1,000,000,000,000 on it and it will still trade at the value of its gold content.

I could envision a government getting feisty about this. Technically, I think you can stay out of their way if you

• Stay away from calling it "money"
• Don't even make it remotely look like any government's currency
• Don't distribute it via multi level marketing scams like Liberty Dollar
• Don't make it a political statement and just stick to quietly issuing tokens and making the market for them

I don't claim to have the resources to implement this project. But it would be awesome if someone took it on!

Do you mean Clearcoin?

I know paypal/ebay offers arbitration, and as controversial as it can be, it is a valuable, low cost service. Given that you aren't providing such services, would there be room down the road for a third party arbitrator to control the release of funds to Bob or back to Alice? Any service that is more convenient than going to court would be very appreciated by the community, I imagine.

Oh yeah, nice site!

Definitely!

This is why the issuing entity makes the market by buying and selling their tokens at or very close to face value. There may be situations where it would advantages to buy them back for slightly less than their face value with a promise to raise their buying price after XX number of tokens. This would give traders and incentive to bid up the price to face value, basically adding their bitcoins to the "reserve."

There are plenty of real world examples of this; such as currencies in Latin America that are pegged to the US dollar. They do this because the US Dollar has historically been very stable compared to other major currencies. If I understand Bitcoin correctly, it will be even more stable. A commodities basket currency would operate the same way. This model allows for expansion of the money supply driven by demand and demand only.


Yes! But the point is to have expansion and contraction of the money supply driven by the demand for money rather than a board of financial wizards looking into their crystal balls trying to figure out how they can hit a moving target that only exists in their imagination.


Why not? It's been suggested before, using an Open Transaction currency with Bitcoins as the backing.


Do you mean stamping a face value of Bitcoins on a gold round? I'd be all for that, but price of gold in Bitcoins will fluctuate. It'd be like the $20 gold coins that the US mint issues, which trade at the value of their gold content rather than their face value.

I have an internet attention span about as long as this sentence. Who needs to read articles when headlines will do?

OK, that said, isn't it just all just a peachy and convenient coincidence that his bank pulled the plug on him now?

Good lord..... What this tells you about the people who fall for it is that if they can't smell a fed who is that obvious then how are they going to blow anything up without the fed's help?

http://www.salon.com/news/terrorism/index.html?story=/opinion/greenwald/2010/11/28/fbi

I was referring to merchants that accept virtual credit cards without verifying name address, etc, but this list is useful, too! Thanks!

Sorry guys, they told me to fuck off and die :*(

I'm intrigued. I live in Portland, can I still buy from this dealer in NYC?

What I proposed was a token pegged to bitcoin, not backed by it. Rather than go through all the trouble of destroying tokens or using scratch offs you would set up a transparent, accountable entity to buy and sell the tokens at their face value in bitcoins. If there is always someone willing to buy and sell at face value then the money supply could grow and shrink as demand dictates without deviating from face value. It all hinges on setting up a trustworthy issuing entity, perhaps a board of trustees operating within very narrow parameters.

I'm just throwing out an estimate, but such an entity could probably fluctuate between 80% to 120% of reserves to tokens issued without a problem. If they were as low as 80% and a run on the bank occurred they would just have to stand tall and show that they were willing to buy back their tokens at face value until all of their reserves were gone. Well before that happens, though, speculators would recognize what was going on and make up for the remaining 20% by buying discounted tokens, thereby rebidding the price back to face value and allowing the issuing entity to start rebuilding.

It's not fool proof, but neither is 100% backed warehouse receipts.

I'll go tell anon, I'm they're reasonable people and will call off the attack.

Glad to hear that! This is the appropriate response to cp on .onion, in my opinion.