The Bitcoin Saga


#801

That’s a different thing - civil liability for a product defect (and no, CL is not liable.) We’re talking about knowingly running a marketplace for criminal activity.


#802

Meanwhile, Sand Hill Exchange, which in classic bitcoin fashion thought that because it used a blockchain the law didn’t apply to it, has been shut down by the SEC.


#803

A case of smarts with no common sense?

A blog post (since taken down), pretty much admitted to manipulating the market with fake financial information. Here’s an archive of the post.

The bots would run every day and place orders against each other so the market looked like it was exhibiting lots of price movement and volume.

Another thing I learned: If you’re gonna try to make yourself look like a legitimate financial institution, you’ll be prosecuted like a legitimate financial institution. And when that happens, you sure as shit better have the legal resources of a legitimate financial institution.


#804

Yeah, the cluelessness is pretty staggering, or would be if it weren’t so typical of Silicon Valley and especially anything connected to bitcoin.

You mean it’s not a good idea to set up an unauthorised exchange and take deposits, then fabricate prices and trading data and pass yourself of as “a legitimate financial institution”. Who could have known? Christ, they didn’t even set it up as a company - you’d think that with all their startup evangelism bullshit they’d at least have that sorted.

The truly remarkable thing, based on comments purporting to be from the founders on Hacker News, they still think they’ve hard done by with a $20k fine for what is basically securities fraud and holding client money without a licence, and they’re still making false, actionable claims and having to walk them back. They desperately need a lawyer to physically restrain them.


#805

It’s amazing how self-aggrandising and clueless that post was. They act as if they were some sort of tech martyr. They are just criminals, I can’t imagine that they thought fabricating market activity was legal in any fashion. $20,000 fine gets me angry with the SEC that people like that slide so easily. They should be put in jail.


#806

Whoops.

The alleged inventor of Bitcoin is in trouble.

Australian police raided the Sydney home and office on Wednesday of a man named by Wired magazine as the probable creator of bitcoin and holder of hundreds of millions of dollars worth of the cryptocurrency, Reuters witnesses said.

More than a dozen federal police officers entered a house registered on the electoral roll to Craig Steven Wright, whom Wired outed as the likely real identity of Satoshi Nakamoto, the pseudonymous figure that first released bitcoin’s code in 2009.

As an early miner of bitcoins, Nakamoto is also sitting on about 1 million bitcoins, worth more than $400 million at present exchange rates.


#807

Yep, Wired wrote an article about the two guys they think invented Bitcoin - Wright and a now-dead American, David Kleinman.

http://www.wired.com/2015/12/bitcoins-creator-satoshi-nakamoto-is-probably-this-unknown-australian-genius/

In this version Wright was the Jobs and Kleinman the Wozniak.


#808

Wonder what they are after him for. Surely he is not in trouble for inventing bitcoin. Maybe more the tax avoidance issue under the Australian ruling of bitcoins being an asset.

Of course, who knows what else he may have been up to.


#809

Wonder what they are after him for. Surely he is not in trouble for inventing bitcoin. Maybe more the tax avoidance issue under the Australian ruling of bitcoins being an asset.

It’s this. Capital gains and goods and services tax, specifically.


#810

Are any of you mockers starting to secretly regret you didn’t mine some of the bloody things when it was easy? :)


#811

Hells yes, love me some free money - but it has not been easy for a very long time now, I well and truly missed the boat by the time I grokked what it was all about. That was around the time there were already a bunch of ASIC miners hitting the market, which was way too late already. Good business if you were making the ASICs, less so if you were the mug thinking each one you bought was a tiny pot of gold.


#812

Heard about Bitcoin through some friends when it was under $2/coin so yes, I definitely regret not throwing 20 bucks of “what the hell” money at it for what could have been a near 1000% return on investment with the right cash out. At that point mining was a sucker’s game because the easy coins were already claimed and the cost of running a mining rig was more than the expected return in coins. Hard to get excited about a currency with that sort of value proposition.


#813

Mike Hearn, a bitcoin dev, says he’s out and bitcoin has failed.

Why has Bitcoin failed? It has failed because the community has failed. What was meant to be a new, decentralised form of money that lacked “systemically important institutions” and “too big to fail” has become something even worse: a system completely controlled by just a handful of people. Worse still, the network is on the brink of technical collapse. The mechanisms that should have prevented this outcome have broken down, and as a result there’s no longer much reason to think Bitcoin can actually be better than the existing financial system.

Think about it. If you had never heard about Bitcoin before, would you care about a payments network that:
•Couldn’t move your existing money
•Had wildly unpredictable fees that were high and rising fast
•Allowed buyers to take back payments they’d made after walking out of shops, by simply pressing a button (if you aren’t aware of this “feature” that’s because Bitcoin was only just changed to allow it)
•Is suffering large backlogs and flaky payments
•… which is controlled by China
•… and in which the companies and people building it were in open civil war?

I’m going to hazard a guess that the answer is no.


#814

He ain’t wrong, I don’t think.


#815

#816

Interesting. I heard about this issue before, but now that it’s happened, I wonder what the outcome will be, and whether people on the street will care.


#817

I doubt most people on the street have any meaningful knowledge of bitcoin.


#818

A medium of exchange that cannot be used for transactions is not a medium of exchange. Whatever Bitcoin is, it ain’t money.


#819

But of course you can use it for transactions. Just not all transactions. What percentage does it have to hit before it’s money? Because of course you can’t use paper money for all transactions, and you can use coins for even fewer.

Naturally I concede that of the things that are called money, bitcoins can be used for fewer transactions than most. It’s a very marginal currency and will likely be marginal forever.


#820

Read the article:

This week the dire predictions came to pass, as the network reached its capacity, causing transactions around the world to be massively delayed, and in some cases to fail completely. The average time to confirm a transaction has ballooned from 10 minutes to 43 minutes. Users are left confused and shops that once accepted Bitcoin are dropping out.