My guess is that they can't comply with FinCEN rulings.

If it's the case, it's just one more example of how regulations kill businesses, and creates market concentration.

Loans in BTC particularly are not feasible due to its extreme volatility.
But if a currency is used by an entire nation, its price won't fluctuate that much. A stable currency would increase in value proportionally to the economic growth of its user base. Loans would then be a possibility, likely with low interest rates. Like they were during the gold standard (during the second half of the XIX century in the US, for instance, prices would systematically fall)


You're ignoring that inflation is not neutral. Those who receive the money first profit from those who receive it last, by being able to buy things before prices account for the new money. When the last people in the chain receive the new money, it'll be already too late. So, at least (when we're talking about 'simple inflation'), it is a nefarious wealth transfer mechanism. It's the most disguised of all taxes, and tend to hit harder on the most ignorant and/or poor.
And that's not all. Inflation nowadays is not simple. It's always directed to the credit market, creating signals to investors that there's lots of resources to invest in long term projects, Obviously creating money doesn't create resources, so this false signal will trigger a malinvestment boom which will result in a burst. These boom and burst cycles result in lots of lost capital. You can read more here:  https://mises.org/daily/672


You're forced to hold at least some because you're forced to pay your taxes in fiat. The network effect of the banking system will also ensure you hold much more than what you strictly need only for taxation.
Let's hope Bitcoin makes it easier to live without fiat one day.

Brushan, if you analyse your argument a little deeper basically what you're saying is that the purchasing power of everybody else should be kept weaker than what it can be just to help exporters.

That's wrong both ethically and economically.
No, you should not decrease the purchasing power of an entire society in order to temporarily help a segment of it. When your money earns value, you earn more purchasing power and you become richer. So if the money of an entire country is getting more valuable, everybody in this country is getting richer!

And this effect over exporters is much less worse than what people make it look like. With his stronger money, the exporter farmer of your example will have more purchasing power to acquire more tools/machinery and be more productive, for example. Also, since the value of money increased, people can receive nominally smaller wages - which could be actually higher in purchasing power.

There are other things you can change to attempt other hashes.
The timestamp, for example, is quite flexible.
And the coinbase is controlled by the generator. There's this extraNounce field people are putting there.

I don't think they can, as of today.

If this was for real - I don't think it is - then eventually the means would show up. Physical representations of BTC could be used, although they should be discouraged due to counterpart or counterfeit risks.
Something like Coinapult SMS wallet could work well too. SMS payments thrive in Kenya, I've heard.
Of all nations on Earth, I doubt there's anyone more used with price instability than Zimbabwe. So that shouldn't be as big a problem to them as it would be to others, even because with BTC prices would be mostly falling, making them richer, not the opposite they're are used to.

tl;dr: It would be great for them to do it.

I just don't believe it's going to happen.

Zimbabwe is not that small. Its M1 is $12G according to the CIA. That's much more than Bitcoin's monetary base has ever been, even during its all time high. I have a hard time believing this.

The Sealand story is more credible though, as that's a really tiny sovereign country (smallest on Earth?) and its prince seems to be tech-savvy. (they attempted to make Sealand a data haven, for ex.). But still, I wouldn't hold my breath. Let's see.

By rea" I mean the actual price, fruit of supply and demand, not an artificial price invented by a government, with no link to reality.

Difficulty to obtain something is a factor naturally embedded in the price of this something. I didn't really understand your point. What do you mean by "international"?

Wait. The "black market dollar rate" is the real price of the dollar. You should not compare with the official dollar price, because that price is totally bogus. You should use the black market dollar price as comparison. What's the BTC premium when you consider the black market dollar for the comparison?

I wonder today if that's a good thing.
Of course, kudos to Sealand's prince for even thinking about it.
But, I mean, would it be good for bitcoiners? If Bitcoin becomes the official currency of a country, wouldn't legislation about buying/selling/holding it automatically become harsher in most other countries?
Just as an example, wouldn't Argentina's capital controls automatically apply, making TradeHill plans impossible to start?
I'd like to be wrong on that one, but I'm not sure.

Argentina has large borders, particularly with Chile (which happens to be the freest Latin America economy according to Heritage). There are lots of kms of deserts among the two, if I'm not mistaken. Smuggling stuff through it shouldn't be that difficult, and Bitcoin can help on that because then you only need to smuggle in one direction.
Depending on how serious Argentine inflation gets, it might become economically worthy to smuggle. And some people might make it a business, bringing Bitcoins to those in Argentina who can't afford to cross the border themselves.

Anyway, this would be a black market solution, and won't be happening until Bitcoin-awareness is much higher than what it is today. But according to the link in OP, Jared is not searching for black market solutions, he's actually going to play it on the open. As soon as his exchange is noticed by the Argentine government (assuming he actually manages to open it), he'll likely be shut down, if not worse. But perhaps he'll manage to create enough awareness so that the black market can take it from there.

Wow, Jared, balls of steel! (or is it insanity/naivety?)
Giving people an easy way to escape capital controls, on the open like this... This is dangerous. I hope he manages to do it without ever needing to step on Argentine soil.

They can't "regulate gravity" but they can pretty much forbid you to skydive for example.

We should not be so arrogant. Governments can be dangerous to Bitcoin.

Watch out with this. If your wallet is not deterministic (bitcoin-qt is not), a new random address will be generated even when you send money. So your wallet file changes. It's true that you don't need to backup that frequently, but that's because the program pre-generates 100 address in advance, and always get "new address" from this pool when it needs one.

A CVM não tem nada que se meter com nada. Na verdade, ela nem deveria existir. Mas vai convencê-los disso.

You wallet may be encrypted, in which case a password is necessary to unlock it and spend the money in it.

Great post Stephen!

Established business people tend to like regulations a lot, indeed. They keep competition at bay, by creating a huge barrier of entry to new market participants. By pressing for tough and strict regulations, Vessenes assures that few people will manage to create new startups to compete with him (like that bitfloor guy for ex., would his exchange exist if regulation enforcement was strict when he started?)

Regardless of whether he meant regulation for his competitors or regulation for Bitcoin in general, I don't find it sane to have a person that likes to use government force in the Bitcoin Foundation board. But who am I to say anything anyway, I'm not even a member of this club.

I very much enjoy the free-market spirit of "older" Bitcoin entrepreneurs like Erik Voorhees, Roger Ver, Charlie Shrem etc. I guess that as Bitcoin approaches mainstream, more "classic" entrepreneurs will start showing up. We'll have to deal with it.

Thank you OP for opening this topic and making me aware of this fact.

Yes, you can reload your backup in a fresh new install of Bitcoin-QT, it will rescan the wallet and find all your transactions.


No. A malware in your computer could access it. If it's kept encrypted, the malware would only be able to steal your money if it also steals your password (assuming your password is strong, otherwise it could bruteforce it). Stealing a password is not really difficult for a malware though: it just need to wait for you to type it.

If you want to own a sensible amount of bitcoins (like, more than the cash you'd hold on your pocket while outside, for ex.), then you should search for more secured configurations, like offline wallets, paperwallets, USB-live systems etc. Or wait for Trezor to come out.
The key to security is never to keep your private keys in the same computer you use for mundane tasks, like surfing the web. Even if you're a security expert, the computer you use to surf the web is always vulnerable to some degree.

E eu diria arriscado para o próprio L. Por acaso ele segue as 3,14*10⁶⁴ leis financeiras/tributárias e o escambau para poder legalmente guardar dinheiro de diversas outras pessoas em sua própria conta como fazia?
No que diz respeito ao Rain, ele já foi ameaçado pela CVM quando tinha outro nome... tenho minhas dúvidas que mudar de nome baste.

Enfim, não defendo a CVM ou essas leis todas, mas o fato é que eles existem e eles têm poder pra foder contigo quando quiserem.

The answers to your questions depend on what software you're using for your wallet.

Assuming it's a desktop client like Bitcoin-Qt, Electrum, Multibit or Armory, then yes, your wallet is a file on your computer. If you have no backups of this file and your HD dies, you lose your money. So, make encrypted backups! And choose a good password for the encryption.

Concerning backups, some clients (Electrum, Armory) have "deterministic wallets". These wallets have a "master key". You only need to backup this master key, and the entire wallet may be recovered from it if needed.
For clients that do not have deterministic wallets, the backup must be performed frequently. Ideally, if you're geek enough, make your wallet file be a symbolic link to a file in some cloud backup service. (encrypted, of course).