http://codinginmysleep.com/confessions-of-a-pirate-pass-through-operator/

Interesting article.  Kind of long.  These are the interesting parts:


Okay, this isn't particularly surprising.  It seemed to be the common wisdom that this is what BS&T was doing.  Still, no real explanation of how this could justify 7% weekly interest.

But what about these details:


Really?  Pirate had such little faith in Bitcoin that he didn't take any Bitcoin earnings?  That seems odd...


Wow, that's kind of surprising.  So Pirate was handed the design for a Bitcoin market manipulator, which he then used to short Bitcoin?  But by whom?


Even more interesting...


Wow.  So Pirate was not only manipulating the Bitcoin market on behalf of clients, but BOSSES as well?

Now this really doesn't add up.  What really went on here?  Was Pirate just a front-man, or a patsy?  Still more questions than answers...

So, now it's time for the OP to tell us what scenario he *actually* described to them.  Because this doesn't at all sound like "selling Bitcoins on my website."


Once again, the legal position of Bitcoin is very simple.  "Money" is that which has future value.  "Currency" is that which has current value.  Bitcoin is a currency, with no guarantee of future value.

Money is actually a very rare thing, because it's pretty difficult to guarantee that something (anything) will have value in the future.  The usual method is via counter-parties who guarantee, through force, that their issued money will have future value.  These issuers tend to be governments, who have regional monopolies on the use of force.  But there are other issuers as well.  Banks, for instance, that hold the debt of a substantial number of members of a community can use this leverage to issue money, backed by the implied force of calling in that debt.  The mafia, also, has its own complex monetary systems, again based on counter-parties and the transmission of force.

Bitcoin has none of that.  Bitcoin is a currency, because it only has current, market value, and because no one guarantees Bitcoin's future value as money.

Money is regulated because it is force.  Money transmission is further regulated because it is a service which comes with the risk of the money losing value during "transmission".  Between the time that you purchase a MtGox code from BitInstant, and redeem that code, MtGox could go out of business.  You would have bought "money" or "stored value" with the implication that it has future value and can be redeemed by the money issuer.  You would have been defrauded if that turns out not to have been the case.  And BitInstant would have been defrauded as well, which is the reason money transmitters actually seek out the protection of governments via regulation.

This has nothing to do with Bitcoin.  Bitcoins can't be regulated, because they come with no implied guarantees of future value, no backing and thus no counter-party risk to regulate.

In fact, the protection that regulation would provide to the OP in the scenario described in this thread is protection against counter-party risk in the traditional banking system, not Bitcoin.  The risk of the fraud of credit card chargebacks has been discussed to death on this forum.  It's the reason no one sells Bitcoins for credit cards.  Not regulation.

http://www.citigroup.com/citi/foundation/invest/index.htm

Citigroup is, of course, the third largest bank in the US.  The focus of the Citi Foundation seems to be on educating the "unbanked" and steering them towards "appropriate" financial products within the traditional banking system.

I wonder if there are any Argentina tourism sites we could post this to.

Bain Capital started with help of offshore investors


What is that, nearly 2% per week?  They could almost give pirate a run for his money.

This assertion is very poorly thought-out, and frankly wrong.  Selling groceries, for instance, to a "known drug dealer" is not a crime, even though groceries might be considered a form of "aid".

Selling Bitcoins, or anything really, with the knowledge that they would be used in the commission of a crime could be illegal.  But it depends largely on the circumstances.

I was going to say, I thought that looked like the Aria.  CityCenter was built, in part, with very progressive oil money.  So maybe you will have a receptive audience.  Just remember, Bitcoin is digital gold.

I held hands with an Asian girl once.

True story.

lol, no he isn't for real.

There isn't really any good way to include a safeguard on Bitcoins that you want to be able to carry around with you and also spend.  But there are ways to separate your Bitcoins into various places with varying levels of protection against theft.  You can have a spending wallet that only contains a small amount that might get stolen, and a savings wallet that you keep in a safe place.

Businesses usually use time-lock safes in order to enable the storage of large sums while discouraging theft.  Put your savings wallet in one of those.

I think there are a few very different concerns here that must be separated:

1) Falling prices of goods/services
2) Price instability
3) Shortage of currency

For shortage of currency, this is not even remotely a concern with Bitcoin.  Physical currencies, even digital currencies tied to them, cannot be divided beyond a couple of decimal points.  Bitcoins can be divided to 8 decimal points, and more if necessary.  There will never be a shortage.  The value will merely rise to compensate.  Now, does that mean that Bitcoin is immune to any ill effects of rising price?  No.  And it is in early adopters' best interests to spend some Bitcoins in order to spur adoption and to grow the real Bitcoin economy.  But that process is a function of the market, and will be regulated as such.  Which leads to...

Falling prices of goods and services -- this will not hurt Bitcoin adopters in the long term at the very low deflation rates expected.  In the short/medium term, once again the proper rate of spending and consumption is a function of the market.  It is difficult for individuals to determine this rate alone.  But with the help of market functions like futures and options and the incentive for traders to stabilize the price, both buyers and sellers can insulate themselves against rapid price swings, and ultimately the natural technological innovation and advancement inherent in any economy will be harnessed to generate wealth in abundance rather than forced consumerism and waste, and everyone will benefit from falling prices.

Now, the big one is price instability.  This really is the worst problem with any unstable currency, both inflationary and deflationary.  Any currency that is a moving target will introduce fluctuations in value that ripple through the economy and amplify, distorting prices and disrupting the price discovery mechanism.  This will be an especially bad problem with Bitcoin, at least while it is growing.  On top of the many regulatory hurdles to adoption, and the anonymous nature of Bitcoin which attracts extra scrutiny, there are entrenched forces which will absolutely not want to see Bitcoin succeed.  In fact, one of them sponsored the study you cite.  Large banks and central banks, payment processors and even governments all have billions of dollars at their disposal which can be used to disrupt the Bitcoin economy.  As long as the Bitcoin economy is small, this will remain a huge threat.  The good news is that, in the long term this will only make Bitcoin stronger.  The bad news is that, in the short term it will make Bitcoin a very poor medium of exchange similar to precious metals which have been manipulated for decades.  So, actually, one of the best defenses against the most harmful effect of deflation, price instability, is self-interested hoarding.

It's a comment to point out the fact that you and Jeff do the same little irrelevant "scary regulations" dance on literally every other thread in this forum that pertains to buying or selling Bitcoins outside of the large exchanges.

It would probably be considered illegal market manipulation under the laws you like to cite, if it weren't so ham-fisted.  At the very least, it should be considered unethical for a developer/insider and an early-adopter to go out of their way to discourage someone from selling his Bitcoins, under color of law no less.

So whether you two are doing so intentionally or unintentionally, that's what it looks like to a casual observer.  And it really just needs to stop.



This, for instance, seems like diversionary nonsense.  What BitcoinINV posted is the correct interpretation.  The "stored value" that you exchange are MtGox codes.  And you are regulated because you handle other people's money, not because you sell Bitcoins.  It really isn't that complicated.

Frankly, it is absolutely incredulous to me that you don't understand all of this already, and well enough to explain it in a straightforward manner without sounding like you are intentionally discouraging third-party sales.  If you don't, perhaps you should consult some more with your overpriced lawyers.

I see the BitInstant Foundation For The Prevention of Competition circlejerk has arrived to dispense their usual, shitty legal advice.

There aren't really "reviews," but there is buyer feedback.  I listed a few things a while back that I didn't really expect to get much interest, and didn't.  But I did just make my first BitMit purchase recently, so it seems to be growing slowly.

It seems the first Slashdot story was in July '10.  But I seem to recall one in October or November as well.

http://news.slashdot.org/story/10/07/11/1747245/Bitcoin-Releases-Version-03

Very informative.  You should watch all of this.  Guy who worked on the 96th floor of WTC 1, was fired for whistleblowing on money laundering, and was called in for a "meeting" on the morning of 9/11.  He's only alive because he showed up late.  Lays out a lot of information and connects a lot of pieces.

http://www.youtube.com/watch?v=ziQG6LPHUJg&t=4m57s

Oh, and in case it's not obvious.  This is a stupid idea because illegal trade will occur regardless of volatility.  Legitimate businesses need a stable currency before they will adopt it.  You are only defeating your own goal.

So, what do you buy regularly using Bitcoins?  What products do you sell for Bitcoins?  Why should anyone care what you think?  What percentage of your income goes towards Bitcoin trade?

I don't think either one of them deserve to have to eat at Applebee's.