Since the blockchain is public it would be pretty hard to naked short unlike metals where we are just supposed to trust that they it.
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Since the blockchain is public it would be pretty hard to naked short unlike metals where we are just supposed to trust that they it.
Use Bitcoin As A Currency, Get Wiped Out (The Government Likes It That Way)
Tuesday, November 19, 2013 at 8:24PM
Four years after its creation, folks are still arguing over what bitcoin is: “investment opportunity of the millennium,” “part of a societal revolution,” a security, a currency, a casino token? Whatever. But US regulators now have strategy for killing it as a currency.
The Senate is trying to wrap its brains around bitcoin. A sight to behold. Four years after its creation, folks are still arguing over what it is. For some, bitcoins aren’t even casino tokens (no fancy tokens). These non-physical entities traded on electronic exchanges “would likely be securities,” SEC Chairman Mary Jo White clarified in her letter to the Senate Committee on Homeland Security and Governmental Affairs that is now investigating the matter. And as securities, they would be “subject to our regulation.” So a security, not a currency.
Fed Chairman Ben Bernanke attempted to dodge the issue, but didn’t quite make it when he wrote to the committee that the Fed “generally monitors developments in virtual currencies” – so it’s a currency, not a security? He conceded even that virtual currencies “may hold long-term promise, particularly if the innovations promote a faster, more secure, and more efficient payment system.”
Some sort of “private money” is what the German Ministry of Finance called it in August. Under German law, it could be used to settle multilateral transactions. Creating bitcoins (“mining”) was therefore “private money creation.” This emerged as an answer to MP Frank Schäffler’s query. Any gains from selling bitcoins after one year would be treated as capital gains for tax purposes. So it’s a security, in addition to private money? German banking supervisor Bafin also struggled with it, and finally considered it the equivalent to a foreign currency.
A miffed commenter on a Bloomberg article called it “the investment opportunity of the millennium” and “part of a societal revolution.” That would be the other end of the spectrum.
The Senate hearing on Monday was the culmination of a three-month investigation into virtual currencies, said committee chairman Sen. Tom Carper (D., Del.). “Virtual currencies, perhaps most notably bitcoin, have captured the imagination of some, struck fear among others, and confused the heck out of the rest of us, including me.” He was worried that they could facilitate the sale of “weapons, child pornography, and even murder-for-hire services.”
So you’d expect some saber-rattling by the government officials who’d been asked to testify. But instead, it practically turned into a love fest.
Officials from the Secret Service, the Treasury’s Financial Crimes Enforcement Network, and the Justice Department bragged to the committee about successful investigations of crimes where bitcoin or other virtual currencies were used, including the busts of Silk Road, eGold, and Liberty Reserve. They were confident that they knew how to tamp down on criminal use of virtual currencies. No one expressed outright alarm about the new world of bitcoin.
Since every transaction of every bitcoin is forever recorded and part of the system, Mythili Raman, acting assistant attorney general at the Justice Department’s criminal division, pointed out that “cash is still probably the best medium for laundering money.” And she admitted that “many virtual currency systems offer legitimate financial services and have the potential to promote more efficient global commerce.”
At the word legitimate, bitcoin soared. And I mean, SOARED.
Even if they don’t agree on what bitcoin is, regulators clearly don’t want to go through the hassles of banning it or policing it. So if it’s a “security” where in the end a lot of people will lose a lot of money, so be it. That happens every day with securities.
Yet they are fretting about transactions. It seems they would like to prevent bitcoin from competing as a currency with the dollar. But they don’t want to get their hands dirty. And they found out how to do that. It’s so simple, it’s beautiful: Encourage bitcoin to become so phenomenally volatile with such mindboggling jumps and brutal crashes that no one can afford to use it as a currency to buy or sell anything, licit or illicit.
Taking on the dizzying risks of getting crushed by price swings can be fun for speculators, but they would be debilitating for buyers or sellers. So you want to buy a house valued at $500,000 and pay in bitcoins. You sign the contract on September 19, when bitcoins change hands at $134 each. So the contract specifies that you have to pay 3,731 BTC at closing. Closing was last night, after bitcoin had soared to $900. The transaction price of the house, in dollar terms, would then be $3.36 million. You’d get crushed by a $2.86 million loss on a $500,000 house. You’d never, ever do that again.
Another day, the price could swing the other way, and then it would be the seller’s turn to get crushed. That’s the idea. If regulators can keep it that way, while allowing speculators to play with it and have fun with it and drive the price up and down maniacally, bitcoin will die as a currency that can be used to buy or sell anything.
Turns out, all this drama can actually happen in time-lapse. Not in weeks, but in hours. Yesterday around midnight, after an already crazy run-up, bitcoin traded for $575. Then, triggered by the word “legitimate” or some other word, or something in the water, it spiked to $900 for the briefest moment at around 5 p.m., only to crash to $502 by around 4:45 a.m. today. It since jumped to $745, and now, as I’m writing this, re-crashed to $640 $599 $489. You can’t do business with a “currency” like that. You can only have fun with it or lose your shirt. And the Fed, the SEC, and a myriad of other regulators can pat each other, or themselves, on the back.
http://www.testosteronepit.com/home/...ent-likes.html
No problems at all, they can easily create futures, and its derivatives, hundred times or more of real virtual crypto-money, just like they did with gold and silver, if you can convince investors and speculators, that they are better off holding the paper derivative of physical gold and silver than the real thing, they will not have any major problems convincing the public that the safest way of speculating the bitcoin wave is to buy their guaranteed product.Quote:
Originally Posted by Ares
No-one is actually short-selling real silver or gold, they are short-selling the paper-promise to deliver silver or gold, and if they fail to deliver they settle the score in a different way. I wouldn't be surprised if 95% of the latest rise in the price of bitcoins have been driven by JPM and their partners in crime, buying up a significant chunk of real bit coins, so that they can start issuing, futures, derivatives, mainstream investment products on the bitcoin, with the ultimate aim of raking in profits by shorting the hell out of the market at regular intervals, just like they do with everything else, to increase their profits at the expense of their clients...
^This is the art of taking a one billion dollar market, make it a $500 Billion market, where the counterfeit is driving the price of the real thing, and have total control of the counterfeit, which is 100:1 to the real thing. If they feel like it they can continue to play this beast they have created for an annual income, or they can crash bitcoins to its intrinsic value (0), and rake in a few hundred Billions in one go...
:rolleyes:Quote:
Turns out, all this drama can actually happen in time-lapse. Not in weeks, but in hours. Yesterday around midnight, after an already crazy run-up, bitcoin traded for $575. Then, triggered by the word “legitimate” or some other word, or something in the water, it spiked to $900 for the briefest moment at around 5 p.m., only to crash to $502 by around 4:45 a.m. today. It since jumped to $745, and now, as I’m writing this, re-crashed to $640 $599 $489. You can’t do business with a “currency” like that. You can only have fun with it or lose your shirt. And the Fed, the SEC, and a myriad of other regulators can pat each other, or themselves, on the back.
How about stop manipulating the dollar and we'll see how violent it swings in value? Or even Gold or Silver for that matter. The free market isn't pretty, and for a currency that's only 4 years old searching for a price discovery you're going to have really high highs, and really low lows. Whoever wrote this has no clue how markets work apparently.
But that's the thing with Bitcoin. In order to get people to invest they'll want to know JPM's inventory so they'll have to publish their investment address. You can see what's in the wallet plain as day, there is no hiding it, manipulating the numbers it's right there in black and white. I don't think they'll be able to manipulate it how they are used to doing with Gold, Silver, and other commodities / currencies. Now they'll release numbers even though they've been caught lying COUNTLESS times already, they won't be able to really hide that. If they say, you're investing in 1000 BTC's and their wallet only has 5 someone will know they're lying immediately.Quote:
Originally Posted by Neuro
It would be equivalent of you wanting to invest in whatever product JPM has now, and you're ability to look at their accounting ledger. No way in HELL they will allow you to look at it now. But with BTC's you can look at anyone's wallet and see what they have in it. IF they publish the address.
It is in the Fed's interest to manipulate a stable dollar.Quote:
Originally Posted by Ares
It is in the Fed's interest to manipulate precious metals to be erratic so not to be a stable competing currency with their dollar...and it's working well I might add!
Bitcoin is also trying to compete...so it is the Fed's interest to do the same.
No such thing as a free market as long as the Fed exists. All markets are manipulated.
The Fed didn't take power only to give it back!
Don't underestimate the willful ignorance of the vast majority of the population. Butler has over decades exposed the bullion banks manipulation and short position of the PM market. But the reality is that the only thing needed for most people to reject all the readily available facts pointing out that the only safe way of investing in the PM market is to buy physical PM's, is if their personal trusted banker to tell them it is not safe. And people buy SLV and GLD instead... Sorry that is the reality!Quote:
Originally Posted by Ares
The prices in gold and silver haven't been as violent as with crypto's. Yeah it may be in their interests, but someone will know pretty quickly who is accumulating what. There are literally people that monitor blockchain.info (well scripts anyway) looking for large and small transactions going to and from large wallet addresses. The reason being is that they are most likely targeting them to see if they can break in and steal the coins.Quote:
Originally Posted by EE_
The FED's aren't used to doing business in this type of an open environment. They're used to doing everything in the dark. Yeah they may not give power back, but sometimes, just sometimes they can't stop when people decide to take it from them.