US financial regulator: We could regulate Bitcoin “if we wanted”

[New_Frontier]

I'm sorry if this has been posted a few times already, it never fails I post & five people always followup with duplicate links...LOL! Looks like the U.S. might be interested in getting "involved" with Bitcoin from a regulation standpoint...   
http://arstechnica.com/business/2013/05/us-financial-regulator-we-could-regulate-bitcoin-if-we-wanted/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+arstechnica%2Findex+%28Ars+Technica+-+All+content%29&utm_content=Google+Feedfetcher

[myrkul]

Sure, they could regulate breathing, "if they wanted."

Enforcement, now... that's another matter.

[melvster]

I'm sorry if this has been posted a few times already, it never fails I post & five people always followup with duplicate links...LOL! Looks like the U.S. might be interested in getting "involved" with Bitcoin from a regulation standpoint...   
http://arstechnica.com/business/2013/05/us-financial-regulator-we-could-regulate-bitcoin-if-we-wanted/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+arstechnica%2Findex+%28Ars+Technica+-+All+content%29&utm_content=Google+Feedfetcher

Only in the US, but that would damaging to the US. 

[ManBearPig]

Yeah what ties a P2P currency to one country?

The US is only 4.5% of the world's population.

If any one country decides to massively back Bitcoin, we go to 4 or 5 figures. That country may not need to be one with a flawed monetary policy.

[kjj]

“In essence, we’re talking about a type of shadow currency, and there is more than a colorable argument to be made that derivative products relating to Bitcoin falls squarely in our jurisdiction.”

Makes sense.  Their whole reason for existing is to regulate derivatives.

But this is my favorite (quote from the article, not from Chilton):

Bitcoin advocates often cite the fact that the US dollar isn’t based on anything either—President Richard Nixon took us off the gold standard in 1971. However, there is a massive legal and regulatory infrastructure designed to prevent volatility, fraud, and other malfeasance. There are numerous entities, including the CFTC, the Federal Reserve, the Treasury Department, and the Securities and Exchange Commission enforcing the laws. As a decentralized protocol, Bitcoin has none of these.

Plenty of people on these forums would argue that the infrastructure mentioned, which is indeed quite real, does not exist to prevent "volatility, fraud and other malfeasance", but to concentrate that malfeasance into the hands of those blessed by the state.

Fortunately, bitcoin is "based on" math which will confer no such blessing on anyone.

[agentbluescreen]

A Bitcoin functions exactly in much the same way as a "funded" Credit Default Swap (fCDS). You fund it's former owner's "loss" (costs) on it, and the next owner funds yours. It is legally the same as all other exchange traded derivatives which are specifically deregulated to favor the banksters who invented and use them (like loss-ping-pong instruments) to fix stock market prices with.

A Bitcoin is a commercial "over the counter (OTC) derivative" of the current-past value and future possible values of itself and it's network, which are only (at best) completely deregulated commercial resources, and neither "commodity futures" nor "securities" as per the CFMA of 2000.

[RenegadeMind]

“The bank that is storing my money is highly regulated by federal regulators and backed by a government with a huge army behind it,” James Angel, a business professor at Georgetown University, told Ars last month.

In plain English... force is needed because it's so shoddy that nobody would use it if they had a choice.

"I don't want to regulate everything under the sun," Chilton added in the CNBC interview. "If you guys want to be a shill for the financial industry and support a chattel currency that people use to purchase drugs and money with—have a party, man. My job is a regulator; I'm going to look after it."

Shill? Seriously? Wow. Hypocrisy on crystal meth.

The real take-away from this is FREEDOM SCARES THESE CONTROL FREAKS!

[darkmule]

The CFTC regulating Bitcoin?  Bitch, please! 

This nearly impotent body can't even regulate what it's supposed to regulate.  While I'd be worried about FinCEN or something like that going after Bitcoin, I'd be more worried about being mugged by a troop of Girl Scouts than these bozos.

[mg27341]

Sure, they could regulate breathing, "if they wanted."

Enforcement, now... that's another matter.

+1 to you for that...

[dmartig]

“In essence, we’re talking about a type of shadow currency, and there is more than a colorable argument to be made that derivative products relating to Bitcoin falls squarely in our jurisdiction.”

Makes sense.  Their whole reason for existing is to regulate derivatives.

But this is my favorite (quote from the article, not from Chilton):

Bitcoin advocates often cite the fact that the US dollar isn’t based on anything either—President Richard Nixon took us off the gold standard in 1971. However, there is a massive legal and regulatory infrastructure designed to prevent volatility, fraud, and other malfeasance. There are numerous entities, including the CFTC, the Federal Reserve, the Treasury Department, and the Securities and Exchange Commission enforcing the laws. As a decentralized protocol, Bitcoin has none of these.

Plenty of people on these forums would argue that the infrastructure mentioned, which is indeed quite real, does not exist to prevent "volatility, fraud and other malfeasance", but to concentrate that malfeasance into the hands of those blessed by the state.

Fortunately, bitcoin is "based on" math which will confer no such blessing on anyone.

THIS

[Cryptoman]

If any one country decides to massively back Bitcoin, we go to 4 or 5 figures. That country may not need to be one with a flawed monetary policy.

Which country doesn't have a flawed monetary policy?

[myrkul]

If any one country decides to massively back Bitcoin, we go to 4 or 5 figures. That country may not need to be one with a flawed monetary policy.

Which country doesn't have a flawed monetary policy?

The Swiss seem to be doing pretty well for themselves. Managed to stay out of that Euro mess, too.

[marcus_of_augustus]

If any one country decides to massively back Bitcoin, we go to 4 or 5 figures. That country may not need to be one with a flawed monetary policy.

Which country doesn't have a flawed monetary policy?

The Swiss seem to be doing pretty well for themselves. Managed to stay out of that Euro mess, too.

No, not really .. they have essentially pegged their currency (franc) to the Euro. So they are being dragged into it whether they like it or not now.

... also I wonder how long until mouthy corrupted Chilton gets an unwanted anonymous package in the mail from SR?

[darkmule]

No, not really .. they have essentially pegged their currency (franc) to the Euro. So they are being dragged into it whether they like it or not now.

Bad play.  Often, pegging currency to the value of another currency, without regard for its inherent value, leads to a dramatic devaluation at some point when the market refuses to continue going along with the fiction.  A cascading series of economic failures resulted from the Thai government's insistence on a fixed exchange rate with the U.S. dollar, leading ultimately to the 1997 Asian currency crisis. 

[phlogistonq]

While I like this early 'wild west' phase of bitcoin as much as any of you, regulation and taxes are inevitable if we ever want bitcoin to succeed on a truly massive, mainstream scale.

So, I would welcome the US and other governments to put some proper regulation in place, preventing obvious problems such as money laundering and tax evasion.

Manipulation, volatility etc are perfectly natural and should not be regulated ofcourse, those are just inherent to a any commodity of which the price is truly decided by a free market.

[ManBearPig]

If any one country decides to massively back Bitcoin, we go to 4 or 5 figures. That country may not need to be one with a flawed monetary policy.

Which country doesn't have a flawed monetary policy?

The island of Yap in Micronesia :p

http://en.wikipedia.org/wiki/Rai_stones

That's what I call a solid currency...

[myrkul]

While I like this early 'wild west' phase of bitcoin as much as any of you, regulation and taxes are inevitable if we ever want bitcoin to succeed on a truly massive, mainstream scale.

Why? If by that, you mean that governments will inevitably try to regulate it, then I suppose you're right. As I said in my first reply, enforcement is going to be somewhat difficult.

[marcus_of_augustus]

So, I would welcome the US and other governments to put some proper regulation in place, preventing obvious problems such as money laundering and tax evasion.

The pressing need for regulations (or deregulations) are rather in the areas of financial privacy and minimisation govt. corruption and waste .... these are the things killing economies, not bitcoins.

[Schrankwand]

If any one country decides to massively back Bitcoin, we go to 4 or 5 figures. That country may not need to be one with a flawed monetary policy.

Which country doesn't have a flawed monetary policy?

The Swiss seem to be doing pretty well for themselves. Managed to stay out of that Euro mess, too.

No, not really .. they have essentially pegged their currency (franc) to the Euro. So they are being dragged into it whether they like it or not now.

... also I wonder how long until mouthy corrupted Chilton gets an unwanted anonymous package in the mail from SR?

No, they have not. They have, only for a certain time, regulated the currency exchange course at a fix rate, to PREVENT collapse. Basically switzerland was getting richer and richer because of its economy value, leading to a point where their exports have become incredibly problematic.

So they have deliberately made sure their currency does not become too valuable for other nations to invest in their country. Switzerland was already extremely expensive before that move.

[marcus_of_augustus]

If any one country decides to massively back Bitcoin, we go to 4 or 5 figures. That country may not need to be one with a flawed monetary policy.

Which country doesn't have a flawed monetary policy?

The Swiss seem to be doing pretty well for themselves. Managed to stay out of that Euro mess, too.

No, not really .. they have essentially pegged their currency (franc) to the Euro. So they are being dragged into it whether they like it or not now.

... also I wonder how long until mouthy corrupted Chilton gets an unwanted anonymous package in the mail from SR?

You seem to suggest that it is temporary move by the swiss to peg their currency to the Euro ... but it already what a couple of years (?) pegged already and Euro is becoming more unstable by the month ... it seems to me like it will be a permanent peg, icbw but I see nothing to suggest otherwise. Basically switzerland needed to begin printing money to accomplish this peg ('to save the economy') and we all know that once a country starts printing money there is realistically no way back.

No, they have not. They have, only for a certain time, regulated the currency exchange course at a fix rate, to PREVENT collapse. Basically switzerland was getting richer and richer because of its economy value, leading to a point where their exports have become incredibly problematic.

So they have deliberately made sure their currency does not become too valuable for other nations to invest in their country. Switzerland was already extremely expensive before that move.