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Author Topic: I feel it is my duty to warn you all.  (Read 4498 times)
lame.duck
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June 28, 2011, 05:45:48 PM
 #61

Fair enough. Why do you think I have not started an exchange in UK? Yep, could not afford or raise 200-500k£ required to get FSA license and cover compliance costs.

Imagine how many business, in so many different sectors, fail to be created due to these kind of requirements?
These artificially created barriers to entry only serve to benefit those who are already established. It's sad to see so many people doesn't getting it and supporting more of these regulations, and at the same time they blaming free markets for income disparities.


Totally agree. Those compliance costs seems more like a barrier to entry than anything else.



And why not to rent a postbox in Japan or the cayman islands and start business there?
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June 28, 2011, 06:20:38 PM
 #62

I cannot post outside this area, but perhaps some of you might benefit from what I have to say.

I work in finance for an international NGO and have been watching this bitcoin saga unfold with some academic curiosity and no small level of entertainment. I have no problems with bitcoin as a concept, and the agencies and governments I work with have little concern aside from its potential use as a medium for money laundering, though even in this respect it is still a very minor one given the tiny size of the bitcoin economy relative to that of other illicit financial activities. On the list of priorities, it isn't. So you all have no need for worry there from what I have heard.

However.

This is a world with laws. The frankly hilarious incompetence with which MtGox has been operating cannot be allowed to continue. Regulation, no matter what some of you seem to think of it, exists for a reason, and it is to prevent things such as this. Had there been accurate reporting, disclosure, meeting of capital requirements, self-regulatory structure and organization, safeguards against market manipulation, and so on, perhaps this all could have been avoided. It is for this reason that I contacted a colleague with the Japanese Financial Services Agency, who will be investigating MtGox for operating in violation of the Financial Instruments and Exchange Law. Their criminal negligence will end up costing many of you money; hopefully my warning here and swift action by the Japanese authorities will minimize that.

Enjoy.

This is pretty funny, considering how much market manipulation goes on in the "regulated" markets you hold so dear. Take a look at CCME and SPNG for an example of how well regulation works in the United States. Your fear mongering is not really necessary. Even after the enormous mtGox "hack" (which is a pretty loose definition by the word), the value of Bitcoins never went below $10.

Any similar scandal would've turned any normal company into a pink sheet stock!

Bitcoin is backed by faith in cryptography and solid networking principles and not by faith in a bunch of guys that can't tie their shoes without litigation and can't keep their pricks in their pants to save their lives.

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TheGer
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June 28, 2011, 06:28:20 PM
 #63

And Regulation has worked out so well.  First World Nations are having their Economies regulated right out of existence...

"Regulation, no matter what some of you seem to think of it, exists for a reason"
Agozyen
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June 28, 2011, 07:18:32 PM
 #64

I cannot post outside this area, but perhaps some of you might benefit from what I have to say.

I work in finance for an international NGO and have been watching this bitcoin saga unfold with some academic curiosity and no small level of entertainment. I have no problems with bitcoin as a concept, and the agencies and governments I work with have little concern aside from its potential use as a medium for money laundering, though even in this respect it is still a very minor one given the tiny size of the bitcoin economy relative to that of other illicit financial activities. On the list of priorities, it isn't. So you all have no need for worry there from what I have heard.

However.

This is a world with laws. The frankly hilarious incompetence with which MtGox has been operating cannot be allowed to continue. Regulation, no matter what some of you seem to think of it, exists for a reason, and it is to prevent things such as this. Had there been accurate reporting, disclosure, meeting of capital requirements, self-regulatory structure and organization, safeguards against market manipulation, and so on, perhaps this all could have been avoided. It is for this reason that I contacted a colleague with the Japanese Financial Services Agency, who will be investigating MtGox for operating in violation of the Financial Instruments and Exchange Law. Their criminal negligence will end up costing many of you money; hopefully my warning here and swift action by the Japanese authorities will minimize that.

Enjoy.

 Thanks for letting us know that the government isn't interested in Bitcoin beyond it's money-laundering capabilities.  I feel SOOOOOoo much safer now that I have your word on this.  It was very kind of you to take the time to follow and research Bitcoin all this time to step in and calm all our fears.  It's truly soul-soothing.  I can sleep now.  It's actually good that I now know this because I haven't been sleeping well, and I blame Bitcoin!  But thanks to you and your MASSIVE breadth of knowledge on Bitcoin, I feel safe.  Your total of 5 posts as of this writing surely qualify you as an expert on the subject of Bitcoin, even though it's been around for two years and you registered your Bitcoin forum account on June 24 2011.  Again, thank you for reporting MtGox, a company you have no interactions with, to the appropriate authorities.  That certainly makes me feel better, knowing that there are people like you, willing to stick your noses in other peoples business for no reason at all.  Three cheers for Nomen nescio!  Let's all cheer for this brave individual who was willing to stand out from the crowd and be identified!  Oh wait...

 Nomen nescio = anonymous. Do you really think we are that stupid?  Do you really think of yourself as some kind of anonymous super hero?  GTFO Troll.

 How would regulation have prevented the hack?  Laws already exist against hacking.  And unauthorized use and so on.  What we have here is another 'Wall-Street' type that can't wrap his head around Bitcoin.


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bonker
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June 28, 2011, 07:26:04 PM
 #65

Fair enough. Why do you think I have not started an exchange in UK? Yep, could not afford or raise 200-500k£ required to get FSA license and cover compliance costs.


Good point buddy. Innovation not regulation.

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helmetedwarrior
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June 29, 2011, 03:56:46 AM
 #66

I have one thing to say about this fear mongering about bitcoin...Blah Blah Blah Blah Blah...like anyone really cares.
indio007
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June 29, 2011, 04:18:52 AM
 #67

So your a snitch , so what? I can prove bitcoins are backed by a valuable consideration. I'd really like to see you do the same with USD. The are supposed to be redeemable in lawful money on demand as per US Code Title 12 -Section 411. Have you ever actually done so? Has anyone in the last 20 years redeemed a federal reserve note for lawful money? Don't talk about rules and regs when the Kleptocracy you support ignores them. Shit FRN's don't even claim to be payable on their face.

You might be able to trick the dregs but some of us know about money  starting with Lord Holt making inland bills of exchange akin to foreign bills of exchange... which is what an FRN theoretically is.

ryannathans
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June 29, 2011, 07:49:58 AM
 #68

Can I hold a bit coin? No.
Can I touch a bit coin? No.
Is it illegal? No.
Is it traceable? No.

Whacha gonna do?

Prove that I have X amount of bit coins.

Oh wait, you can't? That's tragic.
Hunterbunter
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June 29, 2011, 08:31:30 AM
 #69

But yes, if you think you will convince me that regulation is unnecessary, you are wasting your time. It, even if imperfectly, does ensure a more or less level playing field, a single set of rules, and most importantly accountability when things go awry. Nothing against bitcoin, knock yourselves out. I honestly do believe it will survive, just with different markets.

Nonsense. Regulation is inherent to all human interaction. It is not possible to conduct any transaction at all, ever, without a form of regulation applied on the transaction by one or both parties, with established consequences of failing. The rules of engagement (regulation) specifically describe the common transaction, so to even consider regulation's necessity is irrelevant. Regulation can be established by any group, or person, and others can choose to follow, or not. Government regulation only has meaning because there is a police force to enforce it, but there is no difference to the regulation customers apply when they pressure MtGox to not be so fail. This is the nature of human hive dynamics, or group psychology.

What is at quest here is who knows how to regulate a market better; politicians, self-interested bankers, or self-interested plebs. Bitcoins are giving the power to the plebs to regulate their own wealth. Of course governments won't like that, because money manipulation is how they make people pay for stupid wars, and may have regulations to stop plebs having these crazy ideas of grandeur and self empowerment. I personally believe the plebs are the better ones to back, because they act just as efficiently as bankers or politicians (probably more stably), but don't have the super greed of power bankers, nor the power inebriation of politicians.
kgutteridge
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June 30, 2011, 09:37:06 PM
 #70

Fair enough. Why do you think I have not started an exchange in UK? Yep, could not afford or raise 200-500k£ required to get FSA license and cover compliance costs.

Imagine how many business, in so many different sectors, fail to be created due to these kind of requirements?
These artificially created barriers to entry only serve to benefit those who are already established. It's sad to see so many people doesn't getting it and supporting more of these regulations, and at the same time they blaming free markets for income disparities.

Very true, the amount of regulation in doing business is considerable, lets not even get started in companies having to charge each other VAT
Rage
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July 03, 2011, 04:19:26 PM
 #71

This is a world with laws. The frankly hilarious incompetence with which MtGox has been operating cannot be allowed to continue. Regulation, no matter what some of you seem to think of it, exists for a reason, and it is to prevent things such as this. Had there been accurate reporting, disclosure, meeting of capital requirements, self-regulatory structure and organization, safeguards against market manipulation, and so on, perhaps this all could have been avoided.

Regulation in the financial markets are not to 'protect people' anymore than the USA PATRIOT act is to 'stop terrorists'. Financial regulations exist because those in the industry want to make the bar to entry as high as they can in order to discourage competition. It has nothing to do with protecting people.

The Mt. Gox hack was unfortunate and it's something I think the site could have prevented with better security procedures. However, regulating them isn't the answer. What is the answer is to allow the free market to work. Gox users largely gave them a pass this time. Next time, they won't be so lucky. In a market where there is competition, irresponsible parties don't last very long. The market takes care of them without the need for any regulation.

Personally, I cringe every time I see the discussion of Bitcoin market regulation. This is an excellent opportunity to demonstrate the unbridled power of the free market. Regulation won't help the market, it will only extend governmental power into yet another area of peoples lives where it doesn't need to be.

Rage
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July 03, 2011, 04:30:27 PM
 #72

Man what I love about this is that, when statists argue for more regulation here, we don't even need to explain why it's wrong to regulate. Any regulation is simply un-enforceable 

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Rage
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July 03, 2011, 04:43:32 PM
 #73

Man what I love about this is that, when statists argue for more regulation here, we don't even need to explain why it's wrong to regulate. Any regulation is simply un-enforceable 

The 'regulation is unenforceable' belief is common and it's largely true with person to person transactions. But what is possible is forced regulation of the exchanges which would have a chilling effect on the market, I believe.

I heard one of the guys from the project do an interview with CBS News and he said that Bitcoin (I presume he was talking about the exchanges) is working with regulators on things like the 'Know your Customer' regulations, etc. Bad, bad, bad idea.
lame.duck
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July 03, 2011, 05:11:34 PM
 #74

The 'regulation is unenforceable' belief is common and it's largely true with person to person transactions. But what is possible is forced regulation of the exchanges which would have a chilling effect on the market, I believe.

I heard one of the guys from the project do an interview with CBS News and he said that Bitcoin (I presume he was talking about the exchanges) is working with regulators on things like the 'Know your Customer' regulations, etc. Bad, bad, bad idea.

Isn't the law that forbids unauthorized use of someones computer etc. some sort of 'Bad, bad, bad' regulation? Real man can protect their PC or should stay away from the internet Wink

By the way, can you tell me one big bank that doesn't pay pro-deregulation lobbyists?
Rage
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July 03, 2011, 05:19:55 PM
 #75

Isn't the law that forbids unauthorized use of someones computer etc. some sort of 'Bad, bad, bad' regulation? Real man can protect their PC or should stay away from the internet Wink

By the way, can you tell me one big bank that doesn't pay pro-deregulation lobbyists?

Yes, the law that forbids unauthorized use of someone's computer a bad law. The government is not responsible for protecting your computer, you are. Protecting your computer from intrusion is not rocket science. I'd argue that if you cannot protect your computer adequately and it was invaded and used against someone else, it should be your responsibility to offer redress to the person harmed.

As to your question about banks, I can't really answer it since I don't understand your point. Sure, banks *want* to be deregulated but they won't be. Regulation of the banking industry is part of what makes sure it's hard to open a bank and it helps prop up the smoke and mirror game of fractional reserve banking.
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July 03, 2011, 05:35:52 PM
 #76

Sadly the problem for Mt.Gox is they are infected with Federal Reserve Notes (a virus called "USD" for which there is NO legal definition) which are HEAVILY regulated.  And this infection will prove to be one hundred times worse for Mt.Gox than correcting the recent compromise.

BTC will perform exceptionally well when folks EXCLUSIVELY trade BTC directly for products/services etc where NO exchange to a fiat currency is needed/required.  

Until BTC are weened from the necessity of converting back and forth to such phony fiat currencies the usual trolls - IRS/Treasury/US Attorney/State Attorney Generals/CompTROLLER of the US fiat Currency - will be a trollin' for fun and profit.
NghtRppr
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July 03, 2011, 05:38:49 PM
 #77

Had there been accurate reporting, disclosure, meeting of capital requirements, self-regulatory structure and organization, safeguards against market manipulation, and so on, perhaps this all could have been avoided.

It can also be avoided by competition. Companies that are incompetent will eventually be out-competed by others. The companies left standing are better than the ones that failed. The fact people are still using Mt Gox tells us that it wasn't that big of a concern. Stop thinking that you know what's best for other people and let them make their own choices, their own mistakes even.
lame.duck
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July 03, 2011, 06:15:37 PM
 #78

Yes, the law that forbids unauthorized use of someone's computer a bad law. The government is not responsible for protecting your computer, you are. Protecting your computer from intrusion is not rocket science. I'd argue that if you cannot protect your computer adequately and it was invaded and used against someone else, it should be your responsibility to offer redress to the person harmed.

Do you really think that MTGox has enought assets so compensate for the total loss on all bitcoins in their wallet? As i read some days ago it sems that there were enough security holes to get arount the 1000$/day limit? Is copying someones wallet.dat illegal at all? Maybe the DCMA (fair use clause) applies and the copyist is only allowed to spend 10% of the bitcoins.

Quote
As to your question about banks, I can't really answer it since I don't understand your point. Sure, banks *want* to be deregulated but they won't be. Regulation of the banking industry is part of what makes sure it's hard to open a bank and it helps prop up the smoke and mirror game of fractional reserve banking.

At least in europe there were severe regulations that were taken down in the past 'to develop the markets'. Will you tell me someone that can't affort half a million $ to pay for a banking license is thrustworth to put his money there? And even without, paypal did operate in Europe several years without a banking license.
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July 03, 2011, 06:22:39 PM
 #79

It is possible.  Start moving around too much money and the tax collector is sure to show up for their share.   Wink
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