Tuesday, January 28, 2014

The US Crackdown On Bitcoin - The End Of The Amazing Bubble


  The only Bubble from 2013 left untouched so far is Bitcoin: after its crash post Chinese ban and coordinated attack by the Central Banks Bitcoin has recovered its grounds and was trading close to $1000 range again. These days, with closing window for currency withdrawals from Bitcoin exchanges in China, DOJ has made its move. The most sexy attribution of Bitcoin - its supposed anonymity, will be used against it. As we have discussed before this anonymity is widely misunderstood and as Silk Road case demonstrates: All Transactions can be Reconstituted As An Evidence.
   China bans Bitcoin and encourages its citizens to accumulate Gold. Central Banks all over the world are warning about the speculation danger related to Bitcoin. FED keeps very suspicious silence about its real stance about the FIAT alternative and after fighting Gold for 100 years it is a given that Bitcoin will be taken out once NSA will complete its job. Now Robert J. Shiller has joined our small crowd and called Bitcoin as it is:

"It is a bubble, there is no question about it.... It's just an amazing example of a bubble," the Business Insider quotes Shiller, talking to the World Economic Forum in Davos, Switzerland.
“I’m amazed by how people are so excited about it and I tell my students ‘no, it's not such a great idea’,"the economist said.

Bitcoin is a bubble - Nobel Laureate in Economics



Bitcoin vs Gold Debate With James G. Rickards And Roman Skaskiw

Bitcoin Is a High-Tech Dinosaur Soon to Be Extinct

Here is another very sobering view from China on Bitcoin:

Bitcoin bubble won't last without Beijing's approval

"Bitcoin is a bubble that foreigners cooked up and, by all appearances, is designed to rob the credulous Chinese masses. When the bubble bursts, the Chinese government won't be able to arrest these foreigners and get the money back. The bubble is not under Chinese government control. Hence, it cannot be tolerated."

  Stephen Mihn provides very interesting historical perspective on Bitcoin. If you study the history you can know the future. Currencies come and go and some was even thought to be better than Gold for a while, but only for a while. Once you can "print" or "create new Gold" - it is not Gold any more.

"Gold 3.0": Want to create the next Bitcoin? This website makes it easy – too easy

 "So much for the "Gold 2.0" and new store of value - Bitcoin's value proposition is fading away by the day. It is not so anonymous as a lot of people think, it is not so easy to transfer, scams around Bitcoin are happening daily in more and more forms. Banksters are entering the game if they were not there already from the very beginning. And NSA prints are all over Bitcoin according to some reports on SHA256. But now you can have your own Gold 3.0 - just chose the name. OK, maybe for you it will be difficult to compete with pumpers of Bitcoin, but JPMorgan or FED can easily do so. It is very interesting to note that China has effectively banned Bitcoin from any authorised financial transactions, but FED is not so restrictive at least now - so who is really behind it now?
  With Bitcoin crossing $1000 mark again at Mt.Gox today we issue our Warning like we did last timeBitcoin is building a Double Top potentially and level of $1240 will be crucial. It is the great present to Chinese holders - we guess that they will be happy to sell into this strength with restrictions for FIAT withdrawals from Exchanges coming in place by end of this month."

Christopher Mims: The existential threat to Bitcoin its boosters said was impossible is now at hand

 "Another day and another blow to Bitcoin, as we have written before: people will be able to corrupt everything in time. Cristopher Mims investigates the technical threat to Bitcoin's decentralised infrastructure from the coordinated attacks. Risk of Double Spending is the real issue now."


DOJ Finally Going After The Criminal Masterminds With Arrest Of 24 Year-Old Bitcoin Exchange Founder

The US crackdown on Bitcoin has been long in coming, with ebbs and flows of enforcement as regulators have been unsure exactly how to proceed with dismantling the digital fiat alternative. This morning the ebb became a rising tide, after U.S. prosecutors announced charges against two men operating Bitcoin exchange businesses for attempting to sell $1 million worth of Bitcoin to users of the underground black market website Silk Road, which was shut down by authorities in September.
Reuters reports that the U.S. Attorney's office in Manhattan said in a statement that authorities arrested Charlie Schrem, chief executive officer of the exchange BitInstant.com, on Sunday and Robert Faiella, who ran an underground Bitcoin exchange called BTCKing, on Monday. The two were charged with conspiring to commit money laundering and operating an unlicensed money transmitting business. Schrem is also vice president of the main Bitcoin-focused trade group, the Bitcoin Foundation, according to the foundation's website and Schrem's LinkedIn profile.

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