Digital currency firm co-founder gets 20 years in U.S. prison

[Xiaoxiao]

http://www.reuters.com/article/usa-cyber-libertyreserve-idUSL2N18326D

This has to do with Bitcoin right?  Was just going over some google news and found this.

[avikz]

This has nothing to do with bitcoin. Liberty reserve is the most widely used payment processor back in 2008-10. But mostly LR was being used for ponzi scheme scammers. But US legislation is so dumb that they could't catch the scammers but caught the bank owner for money laundering for providing them a platform.

I have also lost around 1 grand when LR closed down. Be assured, US will also try to seize the bitcoiners very soon as they don't want the power to be distributed to the general people.

[Cyaren]

Liberty reserve uses fiat. It supports ponzis. It is not decentralized. So no, it is not entirely related to bitcoin.

But it is sort of anonymous. The owner is pretty unfortunate to suffer for this, but it's his fault not to implement KYC and AML policies when it's needed.

Another reason to choose BTC over fiat.

[Xiaoxiao]

I see.  Title of the article causes confusion stating "digital currency" yet there was no mention of "bitcoin".

[Soros Shorts]

I see.  Title of the article causes confusion stating "digital currency" yet there was no mention of "bitcoin".

LR was a centralized digital currency - nothing wrong with the title. "Liberty Reserve" is also mentioned right in the first sentence of the article.

[Hazir]

Not related to bitcoin whatsoever. Totally different story behind Liberty Dollar and bitcoin.

Liberty Dollar was created as alternative US Currency. They minted their own version of coins and printed banknotes with dollar logo etc.
In the end they were prosecuted for counterfeiting because the silver coins they minted were awfully similar to US currency.

Bitcoin is not similar to any known currency system, and it is not created by a company...

[Soros Shorts]

Not related to bitcoin whatsoever. Totally different story behind Liberty Dollar and bitcoin.

I thought that Liberty Reserve (the subject of the article) and Liberty Dollar were 2 different things? One is digital and the other is physical. The only commonality is that somebody went to jail for printing Liberty Dollars as well.

[whoreble]

Not related to bitcoin whatsoever. Totally different story behind Liberty Dollar and bitcoin.

LR is != Liberty Dollar. https://en.bitcoin.it/wiki/Liberty_Reserve

[ShooterXD]

All scammers deserve this. Jail, for all stealers. What the hell some guys need stole of good people and dont get a job and earn money like a man?
Jail is the minimum thing.

[BADecker]

All scammers deserve this. Jail, for all stealers. What the hell some guys need stole of good people and dont get a job and earn money like a man?
Jail is the minimum thing.

I agree. All scammers deserve this and worse.

What is gold? Some metal that has some industrial uses. Difficult eating.
Paper money is worthless, inherently.
Bitcoin is nothing but encryption. That's it for Bitcoin.
Property of all kinds has some value.

Using Bitcoin and gold as money generally doesn't scam anyone. But paper dollars is the biggest Ponzi the world has known. It has literally turned power, property and control over to the bankers. And that for nothing... literally nothing.

Because of the banking system - especially the Federal Reserve - people have died, the IRS was made possible, wars rage around the world to keep the Ponzi going by adding nations to the scheme, and you an I are having the proverbial wool pulled over our eyes by bankers and government all the time.

Bankers and government people deserve formal execution.

[knowhow]

Well i used liberty reserve as the most projects connected to it were hyip and ponzis websites soo i were with some payza or paypal funds and i were newbie and without any experience i thinked all websites were honest,offering gold opportunities to all,something that isnt true at all,learned fast about the meaning of scam and this were connected always with this payment option.The put bitcoin in the middle ,saying that looks like the people behind ,this co-founder were with bitcoins to avoid and keep the money protected and keep their business model.

[Cyaren]

Well i used liberty reserve as the most projects connected to it were hyip and ponzis websites soo i were with some payza or paypal funds and i were newbie and without any experience i thinked all websites were honest,offering gold opportunities to all,something that isnt true at all,learned fast about the meaning of scam and this were connected always with this payment option.The put bitcoin in the middle ,saying that looks like the people behind ,this co-founder were with bitcoins to avoid and keep the money protected and keep their business model.

After Liberal Reserve collapsed, people are now using Perfectmoney as an alternative.

It would be interesting to see what happens to Perfectmoney, as it is basically the same system as LR.

Not related to bitcoin whatsoever. Totally different story behind Liberty Dollar and bitcoin.

I thought that Liberty Reserve (the subject of the article) and Liberty Dollar were 2 different things? One is digital and the other is physical. The only commonality is that somebody went to jail for printing Liberty Dollars as well.

Yes, liberty dollar was founded by Bernard von Nothaus. That's a totally different thing.

[alyssa85]

I see.  Title of the article causes confusion stating "digital currency" yet there was no mention of "bitcoin".

LR was a centralized digital currency - nothing wrong with the title. "Liberty Reserve" is also mentioned right in the first sentence of the article.

It was centralised - which means they should have put some anti-money laundering rules in place but didn't.

As an aside this is why bitcoin exchanges have basic kyc and anti-money laundering rules - it is to protect them from being jailed by inadvertently enabling scammers.

[MingLee]

The "Liberty Reserve" was a centralized, fiat institution that aimed to make an alternative for the US Dollar, and backed their "Liberty Dollars" with silver, if I remember correctly. I might be thinking of a different group that had a similar name.

Regardless, this isn't in any way related to Bitcoin, and it related to whatever the "Liberty Reserve" is. Someone made a few bad choices to try and make more money, and got caught and won't have that money anymore.

[coins101]

Something about Liberty Reserve taking a % from every transaction made them an unlicensed payment processor.

[whoreble]

Something about Liberty Reserve taking a % from every transaction made them an unlicensed payment processor.

You mean like miners charging a tx fee, that sort of thing?

[aso118]

I see.  Title of the article causes confusion stating "digital currency" yet there was no mention of "bitcoin".

Other articles on the same topic do mention Bitcoin.

http://money.cnn.com/2016/05/06/technology/liberty-reserve-prison/

The opening line....
Before the virtual currency Bitcoin there was Liberty Reserve -- and its founder just got sentenced to 20 years in prison.