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Bitcoin Hits $400 Ahead of Senate Hearing On Virtual Currency
An anonymous reader writes "The value of bitcoin has surged through the $400 barrier for the first time, as unprecedented growth sees the virtual currency's value quadruple in just three months. Meanwhile, on 18 November, a Senate subcommittee is scheduled to hold a hearing on virtual currencies like bitcoin and its lesser-known competitors litecoin and altcoin. The hearing comes after a unit of the Treasury Department earlier this year issued guidelines stating virtual currencies should be subject to the same anti-money-laundering laws as traditional currency-transfer businesses like Western Union."
Posting to undo accidental mod
The value of bitcoins is up at the news of a hearing that is probably going to make it illegal to do 95% of what is done with BTC?
That makes sense.
Repeal all the anti-money-laundering laws. Problem solved.
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Yes altcoin is the best of the altcoins, there isnt an alternate bitcoin called altcoin, all alternatives are referred to as altcoins.
Any rise in the value of BitCoins is probably because it's the only way to keep anonymous funds now that the Swiss banks are no longer keeping records confidential.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
The Treasury has a vested interest in keeping people on the dollar.
In SOVIET RUSSIA... erm...NSA AMERICA, the Internet logs onto YOU!
lol
Queue the people who will say "Bitcoin will never amount to anything"
Of course these are the same people who have said that every 6 months for years....
I was just reading about another competitor for online payment called Dwolla. Dwolla has the backing of major financial institutes, which makes it more likely to be successful. It seems to me that bitcoin prices are artificially high because people are essentially hording it instead of using it as a currency.
Some people die at 25 and aren't buried until 75. -Benjamin Franklin
The press from silkroad going back online mixed with it actually doing so is making people but BTC more than sell and a lot of ASIC miners have sold off enough BTC to pay for their new hardware by now and are now not selling. Those are the 2 actual factors driving up the price in reality. All other speculation is incorrect.
The value of bitcoins is up at the news of a hearing that is probably going to make it illegal to do 95% of what is done with BTC? That makes sense.
1) It doesn't matter what the US government decides, if people want to use it it will be used. Reference: drugs, prostitution, illegal immigration, abortion, illegal guns, and other world countries.
2) People don't act because they have no alternatives. This is an alternative, but not many people know about it. High-profile senate hearings publicize BitCoin, so that more people will realize how useful it is, and this spurs demand.
3) There are no valid argument against BitCoin. There are economic "story telling" arguments, and predictive "doom and gloom by story telling" arguments, and false equivalences with closely related things (fraudulent exchanges, Silk Road, &c), and outright lies ("it's a Ponzi scheme!!!"), but no actually valid arguments.)
4) All the standard aphorisms apply: buggy-whip manufacturers, the invisible hand, liquidity, privacy and freedom.
BitCoin will become a game-changer (oh, that phrase!) simply because nothing can stop it.
...understand that now that the Gov has a large amount of bitcoins, they need to be tempted to spend them. What better way than driving up the value of the currency?
Bitcoin is not subject to government regulations. They do not mint it, do not control it, and any attempt to control it is an attack on freedom, and they (governemnts) will likely come under some sort of attack if they try.
I have no Bitcoins (since I am not an idiot) and have no vested interest in whether they succeed or fail. However, value cannot be created from nothing. Sure, if you want to exchange made up coins for made up property in World Of Warcraft - that makes sense. But if you want to take something "created" by turning energy into heat and then use that "creation" to buy food - well that's idiotic. Adding to the entropy of the universe does not create value.
This kind of short-sighted answer is the problem with BitCoin backers.
Anti-money laundering laws and regulations are very important because they are what forces the systems that allow law enforcement to determine and sieze the proceeds of crime. Without such siezing, the incentivization of crime increases exponentially.
IE - say I rob a bank. If it is trivial for me to convert the money to bitcoin and transfer to a third party in an untraceable way, then my incentivization for robbing banks is now HUGE, because even if I get caught, I will still be able to keep my proceeds. Get caught robbing bank, go to jail for 10 years, get out, and buy your own island. Sounds like a good deal to me.
7 bitcoins I lost a few years ago...
that would be worth some nice christmas cash, I'd cash out.
In the truest sense BitCoin is commodity, not a currency. You can create, or buy, title to ownership of a piece of information that others have agreed to both recognize your ownership rights, and value it as well. It also, unlike every other currency today, is the ultimate Hard Currency because there is a hard upper limit on its creation. You can mine more gold for your gold backed currency, but the total number of BitCoins under the current rules (a most important distinction) has a hard cap.
It's also the ultimate fiat currency because although it took some effort -- or lucky guesses -- to create, it is not legal tender anywhere. It only has value between 2 people willing to agree on that value. Rather the Esperanto of money. But to try and turn it into a currency so that governments can regulate it under existing laws is absolute Fraud on their citizens.
Of course, when has that ever stopped politicians from "creating" new tax sources, which is the ultimate end of this exercise in case you hadn't realized that yet.
Everyone in government supporting this regulation fantasy should be voted out of office immediately -- although we all know that's never going to happen.
"It's the height of ridiculousness to say for those 9 lines you get hundreds of millions."
Anybody remember 'Flooze'?
You really thing we need 'major financial institutions' to create a digital currency? Why would we trust the likes of G.S.?
John McAfee 'It was like that time I hired that Bangkok prostitute; to do my taxes, while I fucked my accountant'
where it can shoot up fast and then come down fast.
The winning move is to buy when it is low and sell when it goes up.
But when lot's of people buy and sell is when it makes big moves.
We should all like this Bitcoin *concept* even if we don't all like Bitcoin itself or the culture that has evolved around it. Yeah, I know it's the "fad" to bash Bitcoin. But it's disappointing, because Bitcoin represents everything that us nerds reading slashdot should like: It's a mix of cryptography, freedom of speech, computing, networking, finance, economics, and even politics. Most of us here dig that stuff.
Get over the hype and take Bitcoin for what it really is: a fascinating experiment that has, so far, withstood the amazing barrage of publicity, hacking attempts, legal uncertainties, and remains valuable for reasons completely contrary to everyone that says it's worthless. It may become worthless one day, but consider the possibility that Bitcoin is disproving all your wildly oversimplified assumptions about what makes something valuable. It is completely different than anything else we know, and there's plenty of reasons to believe that it could succeed as much as it could fail.
Why does gold have value? Nothing is backing gold (and if it was valued only for its material properties, it would have a value only a fraction of $1,400/oz). Yet it has high value, mainly because of its properties to behave as a transferable store of value: scarcity, fungibility, density, identifiability, etc. Bitcoin is really quite similar but with some different properties. Ease of transfer over the internet, fungibility, scarcity, storage efficiency, near-anonymity and built-in escrow. I don't think it's any more ludicrous for Bitcoin to have value than it is for gold to have value. And in the end, when I want to sell WoW weapons, buy webserver space, or play a few games of poker online, why would I use credit cards or paypal, which all require me to remember log-in creditials, give away personal information to be [improperly] protected by a third-party and/or pay a bunch of fees. There's plenty of value in being able to pay people across the world, instantaneously, without sacrificing your privacy, and without paying any fees. Why is that not valuable?
and then bought some MDMA via Sheep Marketplace for a trip to Vegas.
Announcement from your friendly NSA :
We would like to inform you, that the following keywords: "MDMA", "Sheep Marketplace", "trip" and "hearings" (*)
have triggered our system to send you to our "fake slahsdot".
A javascript exploit has been injected into you browser to help track you down and burst your door,
but we wanted to inform you that we detected that the chinese were already in your computer trying to steal your private keys.
(*): Don't ask.
"Sufficiently advanced satire is indistinguishable from reality." - [Tips: 1DrYakQDKCQ6y52z6QbnkxHXAocMZJE61o ]
I find it fascinating that as the cost of minting BCs in terms of compute cycles goes up, so does their value relative to the dollar. Is that behavior by design?
"It's the height of ridiculousness to say for those 9 lines you get hundreds of millions."
Money is any object or record that is generally accepted as payment for goods and services and repayment of debts in a given socio-economic context or country.[1][2][3] The main functions of money are distinguished as: a medium of exchange; a unit of account; a store of value; and, occasionally in the past, a standard of deferred payment.[4][5] Any kind of object or secure verifiable record that fulfills these functions can be considered money.
Money is historically an emergent market phenomenon establishing a commodity money, but nearly all contemporary money systems are based on fiat money.[4] Fiat money, like any check or note of debt, is without intrinsic use value as a physical commodity. It derives its value by being declared by a government to be legal tender; that is, it must be accepted as a form of payment within the boundaries of the country, for "all debts, public and private"[citation needed]. Such laws in practice cause fiat money to acquire the value of any of the goods and services that it may be traded for within the nation that issues it.
The money supply of a country consists of currency (banknotes and coins) and bank money (the balance held in checking accounts and savings accounts). Bank money, which consists only of records (mostly computerized in modern banking), forms by far the largest part of the money supply in developed nations.
Money acts as a standard measure and common denomination of trade. It is thus a basis for quoting and bargaining of prices. It is necessary for developing efficient accounting systems. But its most important usage is as a method for comparing the values of dissimilar objects.
Wikipedia
Bitcoin may be money in nearly every sense of the word but it lacks stability to act as a standard measure and common denomination of trade. Just as money in unstable countries lack the same attributes. It's a medium of speculation and not being tied to a stable market place perhaps overseen by a stable government it will likely never be more than a means of speculation.
case and point: http://btc.ondn.net/
>bitcoin prices are artificially high because people are essentially hording it instead of using it as a currency.
And are doing extremely well.
$0.10 -> $400 is a good return.
I should use this sig to advertise my book ISBN-13 : 978-1501515132.
Sure, which means getting rid of all income tax, capital gains, any form of 'service' as in no government, so buy a lot of guns, because the robber barons that were politely robbing you blind privately will be shooting you in your face for all those gold coins you have packed under your matress.
Really dude?
Is this the sort of argument that rates "+4 interesting" on slashdot nowadays?
Stop story-telling! We're nerds - we're better than that.
The value if bitcoin succeeds is 100x +. It's a win for merchants and a win for consumers and a big screw you to the banks. People love clicking on why bitcoins will fail articles, so bloggers keep writing them.
Nobody invested in a pyramid scheme or speculative bubble ever thinks they can lose ....... until they do.
That's the reason they work, and that's the reason they ultimately end up with so many people losing.
The key to identifying them is to look out for talk of "new paradigms", "completely original concepts that have never before been tested" and other such claims. Add in some modish concepts, whether it's South Sea bubbles, tulipmania, railroads, or seemingly in this case "freedom from the government" and enough suckers will generally line up. Finally, when it all crashes wait for the anguished cries of those who have been seperated from their money for governement to step in and regulate.
Tisk tisk... That's what they are BEST at. Discussing something they don't understand then passing laws which don't fix the perceived problem but make matters worse while patting themselves on the back claiming "progress".
Case is point? The ACA....
"File to fit, pound to insert, paint to match" - Aircraft Maintenance 101
Dwolla isn't in any way a competitor to Bitcoin. Dwolla, as you pointed out, is an online payment system. It is a competitor to PayPal, Google Wallet, credit cards, and other forms of online payment. Payments in these systems are done in dollars and other forms of currency.
Bitcoin is a currency. It's not competing with Dwolla but the US dollar.
The problem with BitCoin is it is nowhere near as anonymous as people think it is. In fact, it is even less anonymous than current currencies.
Consider the dollar. If I take a dollar in cash and deposit it in the bank, and transfer it to you, and you take it out of the bank - that dollar is now different. Those two dollars have different serial numbers. This is because in the eyes of the government, the law, and everyone under the sun, all individual dollars are the same and interchangeable - my dollar is as good as your dollar. This is what makes money laundering possible and why governments have a hard time battling it - it is pretty easy to funnel money from crime into another medium / person and "wash" the money in a way that makes it totally impossible to tie it to a specific crime, because all dollars are the same.
BitCoin is not like this. A bitcoin is a unique value and as it is passed from one wallet to another, that transaction is logged throughout the network. For any given bitcoin, you can trace the path of THAT SPECIFIC COIN from the time it was created to where it was today - seeing all of the wallets it passed through and what IP address owned that wallet at the time. All law enforcement needs to do to tie a specific bitcoin to a specific individual, for the purposes of an investigation, is to tie a wallet ID to an individual. Thus, any bitcoins used during the process of ANY CRIME are subject to seizure! I have never had anyone explain to me how to get around this problem with BitCoin. People have weird pseudo-anonymous hacks like "use ToR" or "Use a VPN", but all these things do is make it HARDER to tie an individual to a wallet, it is not impossible. In fact with the proper warrants and wire-taps it is trivial to tie a wallet to an individual.
Only if you actually made exchanges at those rate, and the real trick is getting out on time. The vast majority of people might have bought a couple at, say, $1, then sold them when they hit $50 for some beer money. You buy $1000 worth at $1, do you get out when they hit $5? $25? $100? Many early investors took their money and ran, those still holding coins got in at a higher floor. There are exceptions, like that Danish student who bought a few bucks worth when BTC just got started, forgot about them, and found the other day that they are now worth over $600k.
If construction was anything like programming, an incorrectly fitted lock would bring down the entire building...
I would say now is the time to get out. But don't take investment advice from me.
I should use this sig to advertise my book ISBN-13 : 978-1501515132.
I had to double check the exchange rate ticker on mtgox.com. When I checked my online wallet I discovered that i have about $10 worth of bitcoins. yay! I got all of them from faucet sites. :p
pump and dumpers are all around...
Jan 9, 2009 14:00:00 EDT: Bitcoin introduced to the world. Initial value $1 = 250 BTC
Jan 9, 2009 14:00:01 EDT: Bitcoin scam/bubble/fraud/fake/waste of money/never gonna last/shill accusations start on Slashdot and everywhere else.
Flash forward through 4 years of ups and downs, where the OVERALL TREND has been up...
Current value as of 16:30:10: $429 = 1 BTC.
So please! Keep kai-yai-yaiing about shills and bubbles. Your tears are delicious.
[End Of Line]
Yeah, I don't really like bitcoin users either.
They only have to worm their way into the far less numerous exchanges where you turn your BC to fully usable currencies
But who cares about that part? What if I just want somewhere to stuff a ton of money, and then some much later day when I want to access it all, I just take it out in cash and disappear. Then I don't care if it was tracked...
The tax agents want to see how much you are storing away, and if you have a bit coin mining farm purchased with black funds and keep your own wallet they can see nothing.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
You could take a big hit doing this if they came out of the hearing and gave BC a stamp of approval. There is nothing about BC that is inherently designed to facilitate illegal activity, so the hearing could very well go either way.
HA! I just wasted some of your bandwidth with a frivolous sig!
You buy $1000 worth at $1, do you get out when they hit $5? $25? $100?
Here's a simple suggestion: every time the price doubles, sell 33%. I would say that is a reasonable balance between long-term potential and realizing your gains while the realizing's good. (No guarantees about this being the best strategy, though.)
In this example, after the price reached $64/BTC you would be left with about 87.8 BTC (worth $5,619) and $9,237. That's a lot less than $64,000, of course, but it's also a lot more than what you started with, both in BTC and in USD, and you're not exposed to nearly as much risk along the way.
"The state is that great fiction by which everyone tries to live at the expense of everyone else." - Bastiat
There are finite number of BC, and the population is growing. If at any given time 1% of the people are interested in BC, is the demand going to grow or shrink? Demand goes up, supply is fixed, and the price will rise. Pretty trivial economic theory.
An interesting form of currency would be one where the money in circulation was pegged to the population, so that demand would be based strictly off the perceived value and not the rarity of the currency as a result of X people needing to use it to trade goods and services, where X is a growing number.
HA! I just wasted some of your bandwidth with a frivolous sig!
Wave a wand, say an incantation, throw some Federal Reserve notes at it. Or a bill.
Tell it to the Chinese. They're not going to stop mining or buying just because our Senators pontificate. Why should they care if US citizens get screwed again by their own government?
Gold is a physical good that they can confiscate though. Bitcoins are more or less just an idea, and ideas are much easier to steal.
Dwolla isn't in any way a competitor to Bitcoin. Dwolla, as you pointed out, is an online payment system. It is a competitor to PayPal, Google Wallet, credit cards, and other forms of online payment. Payments in these systems are done in dollars and other forms of currency.
Bitcoin is a currency. It's not competing with Dwolla but the US dollar.
Sure...... in the same way gold is I guess..
Accepting donations: 13KKuPrpC81J7ozNJpW4LPJNZ4RCVut14W
You can tell how powerful someone is by the magnitude of the crime they can commit and be able to get away with.
There's no doubt some part of the value (maybe the majority right now) of BTC is based on rampant speculation, however both Bitpay and Coinbase claim to service over 10,000 merchants with Bitcoin payment systems.
You claim the USD has value because people go out and spend it, well clearly people want to earn BTC by providing useful goods and services. And as people see their BTC value grow they will inevitably spend those coins into circulation thus giving the currency real value (after all "things" will always be more valuable than any currency, USD or BTC).
Lastly don't discount BTC's usefulness for doing international money transfers (there is an example of someone transferring $500k of BTC for a total fee of 6 cents - wire transfers would typically cost 2.5+%), or its usefulness as a store of value in places with chronic price inflation (some evidence of popularity in Argentina and Venezuela now).
My prediction: bitcoin will continue to rise in value, but not without suffering several more speculative bubbles.
There's no doubt some part of the value (maybe the majority right now) of BTC is based on rampant speculation, however both Bitpay and Coinbase claim to service over 10,000 merchants with Bitcoin payment systems.
You claim the USD has value because people go out and spend it, well clearly people want to earn BTC by providing useful goods and services. And as people see their wealth grow they will inevitably spend those coins into circulation thus giving the currency real value (after all "things" will always be more valuable than any currency, USD or BTC).
Lastly don't discount BTC's usefulness for doing international money transfers (there is an example of someone transferring $500k of BTC for a total fee of 6 cents - wire transfers would typically cost 2.5-3.5%), or its usefulness as a store of value in places with chronic price inflation (some evidence of popularity in Argentina and Venezuela now).
It would suit people nicely, if they remember that there actually are countries outside the US, who doesn't abide by US law, and, generally speaking, could not care less what the US congress decides about bitcoins.
Seems to me if, instead of fighting bitcoin, the US Government started MINING bitcoin, we might actually have a way out of our current financial crisis.