IRL Bitcoin Maker Shut Down by U.S. Government

[Slash2x]

Wait what is that? It sounds like Mexico is calling out for his business..... Yep there he went! Thanks Obama!

 

[Baresark]

They are a virtual currency, as in they don't have a real physical counterpart.

Virtual doesn't mean non-physical.

Virtual: almost or nearly as described, but not completely or according to strict definition.

Just because "virtual" is used in the context of computers (virtual reality, virtualspace, virtual machine, etc.) doesn't mean it applies to anything created via a computer.

Having a "real physical counterpart" is not a prerequisite for a currency, ergo a currency that lacks a physical counterpart is still an actual currency, not a virtual one. Debts, for example, are a non-physical form of currency; promissory notes were often exchanged between merchants of different nations in the middle ages, in lieu of actual currency and goods, which could be more easily stolen by highwaymen. The promissory note acted as the medium through which these debts were exchanged between merchants to cut down on the cost of importing.

If you mean that bitcoin lacks physical methods of exchange, Bitcoins have mediums through which they are exchanged, just as a promissory note acts as a medium of exchange for a debt-based currency.

Virtual as pertains to value. Having no fixed value or actual system of measurement, besides against itself and other non fixed currencies. Also, one can easily argue they are generated virtually in an environment that outputs no commodity except for the data bits traveling around the world. I am very familiar with the history of checks, promissory notes and the like. Thanks for the light history lesson.

The value of bitcoins is hightly debated

The value of bitcoins are not up for debate. They're trading for ~$813, or about two Playstation 4s (not counting the tax), last I checked.

That is not an actual intrinsic value. And two weeks ago that value was $1200. Yeah, that isn't volatile at all.

They aren't tied to anything, so they are a fiat currency

That's not what fiat means.

Fiat: a formal authorization or proposition; a decree.

When Bitcoins are declared legal tender in the United States (that is, a debt is annulled if the debtee refuses payment by the debtor in bitcoins), then you can call them a fiat currency, meaning their use as currency has been mandated by fiat.

I love when people pick and choose from the definitions. It also means having no intrinsic value. Which is bitcoins, USDs, Euros... You get my point I hope. It only has value next to other currencies with no intrinsic value. Also, "when bitcoins are declared legal tender"... Haha, you are kidding right? Not gonna happen.

making them extremely volatile and almost useless on the open market.

A lack of volatility also means a lack of flexibility. A currency pegged to something by a central issuer creates a risk that the central issuer has to bear. Unpegged currencies, on the other hand, risk the holders of the currency with the effects of shifting.

That is the problem with currencies not attached to anything. Bitcoins don't matter so much as they are very niche. But Dollars and Euros are an issue. In the case of the worlds real currencies, they are attached to anything, so the value falls on what the issue determines it should be and everyone is negatively affected by actions by central banking organizations.

Also, there is no reason to be a dick by opening like you did, it's just uncalled for. The fact is, there are very few actual definitives in regards to bitcoins.

It's not uncalled for. If you don't know what a currency is, the definition of "virtual", how value is measured, or what the word "fiat" means, you should not pretend as though you can speak with authority on bitcoins as currency. Period.

It certainly is uncalled for. This could easily be a situation of learning and civil discourse, instead you chose to attack me on a quick ad hoc definition and explanation for someone who had honestly asked about what the exact situation was. Nice, you are such a good teacher. We are all so lucky to have you. Good day to you, sir or madam.

 

[medv4380]

This was clearly a scam to everyone who isn't under the influence of bitcoin mania.

It was clearly a scam despite any evidence indicating that it was. They could potentially break your trust, so they obviously always will. Nice logic.

Mania is interesting when it removes your reason. The evidence is who has possession of the private key. You're never supposed to share your private key with anyone when you use a public/private key system. Yet the way the the physical version works the minter must have access to the private key in order to make the coin, and it must be shared by passing the coin. You have to be completely obsessed by the mania to not see the obvious flaw. The entire thing bypassed the very security methodology Bitcoin implemented to protect it. This mentality is why Bitcoin has been plagued by scam after scam. The lack of reason is why so many people actually gave their bitcoins to pirateat40 a-la Bitcoin Savings and Trust ponzi scam. Really, bitcoin mania lacks fundamental reason.

Going into my final statement would require you understand what a Conflict of Interest is, and why financial news reports have to disclose their investments. You're clearly unable to understand the finer points of journalism so I won't beat the dead horse.

 

[UltimatheChosen]

Is the problem because they're made of metal? Because otherwise, pre-paid debit cards could be construed as "minted currency" as well.

Not exactly. Pre-paid debit cards contain a given amount of an existing currency-- they aren't a currency in and of themselves.

 

[loc978]

...good. As far as I can see, there are only a couple of reasons to use bitcoins in the first place. One is to make black market purchases, another is to avoid paying taxes on sales you make... either way, I say if you don't like our laws and taxes, move somewhere that doesn't have such things. I hear Dubai is a popular place for anarchistic assholes to exploit.

 

[Strazdas]

Is the problem because they're made of metal? Because otherwise, pre-paid debit cards could be construed as "minted currency" as well. Or hand-written I.O.U.s for that matter.

See the thing is that both your examples still uses Dollars - an existing and regulated currency, whereas Bitcoins would be another currency.

The government is in no way scared of Bitcoin, if only because there will never be enough bitcoins to actually be useful for every day life. The US economy produces over $16 trillion in goods and services, or a value equivalent to 16 billion bitcoins. There are currently 21 million bitcoins. What the government IS worried about is how easy it makes money laundering and illegal transactions.

The problem with this logic is you consider 1 coin as the lovest denominator. Where in reality you can pay with, for example, 0,00001 bitcoin for something, meaning that given enough inflation of the currency it could cover whole economy. ALso lets not forget that there isnt 16 trillion US dollars in US either. money turns over multiple times a year while you sum the economy. Its called monetary multiplicator, and the faster money turns around the better.

Like those internet service providers. They clearly don't actually give you all the bandwidth you pay for. They obviously throttle it down as low as possible to steal your money from you. Since they could potentially get away with this, they obviously do it.

but they cant potentially get away with it. At least not here where we can legally sue them for it (and win).

Does anyone else find the idea and concept behind Bitcoins a bit worrying? I mean, what if this market collapses and you've put everything you had into it? The only thing that keeps it going is the faith people have in it, and as we saw earlier this month, all a country has to do is simply question how much they're worth and the stuff drops like a stone. This whole thing seems like a very dangerous wave to be riding on.

That same worries also apply to any fiat currency. The only difference here is the faith being applied not to the currency itself but to the government "supporting" it. We have been riding this "Dangerous" wave since removal of gold stnadard.

 

[DTWolfwood]

This is bad news for all the aspiring Scrooge McDucks out there.

If the physical bitcoin is actually worth 1 digital bitcoin, this makes sense.

Thought he was just making them to sell as no value tokens.

 

[helendouglas]

Caldwell has a very brilliant idea. Virtual wealth in the palms of our hands? Why not, right? But I believe if we will convert Bitcoins in physical currency, it will lose its whole essence. Since people had been hooked with the "virtual crypto-currency" concept, I remember how BitcoinDaily revealed Bitcoin competition over physical monetary currency.