Norway Authorities: U.S. Wants to “Remove” Bitcoin

[dicksi]

Norway Authorities: U.S. Wants to “Remove” Bitcoin

Norway’s financial supervisory authority released a Risk and Vulnerability analysis in March of this year. The report analyzed information and communication technology in financial institutions. The report compares bitcoin to monopoly money, while at the same time noting that U.S. authorities have signaled they want to “remove this system.” If the authorities wish to view bitcoin as monopoly money, that is fine. But if they then attempt to “remove” the system from the market, they then put credits like facebook credits and “WoW-Gold” under the same sort of pressure.

The extract from the text reads as such:

2.4.3 Shadow Services on the Internet

2.4.3.1 Bitcoin

Bitcoin9 is a digital currency created in 2009. The name of the currency also refers to “open source” -

Bitcoin program used to send money. Maximum limit on the number bitcoins that can be

current is set at 21 million. There is also a static value after all bitcoins are dealt. Bitcoin is

person based on two person-technology (P2P), and operates without any central server or

intermediaries. All payments will be verified automatically through the nodes in the P2P network, and the system is

built up so that you can not create more money or steal someone else’s. This is ensured through a

“Block chain” that is stored by all nodes in the network.

Bitcoin can be compared with “Monopoly Money” where the individual players buying virtual

monetary values ??called bitcoin to make commercial transactions in a closed trading environment. Liquidity in

“Real” money should always be available if the players want to switch from bitcoins for

such as U.S. dollars or euros. Currently, this activity takes place outside the control of

authorities, and the risk is unknown.

The system is virtual and U.S. authorities have signaled that they want to remove this system before

unsuspecting users is too much involved. For such a system to function, it must have a “rich”

sponsor.

Norway Authorities: U.S. Wants to “Remove” Bitcoin | Silver Vigilante

Senator Schumer Says Bitcoin Is Money Laundering

from the apparently,-he's-unfamiliar-with-cash dept

A few months back, we explored Bitcoin, and the growing attention it was receiving. The distributed currency has certainly been getting a lot of attention lately (causing the exchange rate to skyrocket). Of course, as with any such thing, there was bound to be some sort of backlash from political circles, and this one was extremely predictable. Last week, Gawker wrote a story about Silk Road, the online drug marketplace that users can only access via TOR and where the only currency accepted is Bitcoin. To be honest, the story sounds a little too good, and too "Hollywood" to be real, but perhaps it is real. I find it a little difficult to believe that it has all that many users, given the complex nature of getting it to work.

Either way, Senator Chuck Schumer, who can grandstand with the best of them, apparently got handed that article and saw an opportunity to publicly demand that something must be done about Silk Road. It seems clear from his remarks that Senator Schumer has never heard of TOR:

"Literally, it allows buyers and users to sell illegal drugs online, including heroin, cocaine, and meth, and users do sell by hiding their identities through a program that makes them virtually untraceable," Schumer said at a news conference Sunday. "It's a certifiable one-stop shop for illegal drugs that represents the most brazen attempt to peddle drugs online that we have ever seen. It's more brazen than anything else by lightyears."

Lightyears? Really? In another report he claims that Silk Road and other drug sites are "flooding our streets" with drugs. Except... they're not. There are probably a small handful of people using things like Silk Road today, and they're almost certainly doing it for home use, rather than to "flood the streets." But, that doesn't make for as good a form of grandstanding.

As for "the program that makes them virtually untraceable," he seems to ignore the fact that Hillary Clinton (his former co-Senator from the state of New York) has talked up the value of software like TOR, which makes identities untraceable, as an important tool for freedom of expression around the world. Thankfully, Schumer doesn't seem to go quite as far as directly blaming TOR, though he doesn't appear to separate TOR from Silk Road, despite them being two different things. Also, lightyears? Really?

What he does go after, however, is Bitcoin:

"It's an online form of money laundering used to disguise the source of money, and to disguise who's both selling and buying the drug," said Schumer.

Um. You know what else is a form of currency that is used to disguise the source of money? Cash. And, last I checked, it's still legal tender. Blaming the semi-anonymous nature of Bitcoin is severely misplaced. In fact, in the original Gawker article, there's an update at the end (perhaps Schumer didn't get that far, or never reloaded) where it points out that Bitcoin really isn't quite that anonymous, and quotes a Bitcoin developer as noting that trying to buy drugs via Bitcoin "is pretty damned dumb."

But, according to Schumer, it's "a form of money laundering."

This will get interesting. No matter what you think of Bitcoin (and I'm certainly not sold on the concept), it's pretty clear that governments will attack such forms of currency if given the chance. A silly story about something like Silk Road opens up just such a chance. My guess is that Schumer won't actually do anything about Bitcoin right now (the focus appears to be mainly on Silk Road), but it won't be long before we see more politicians seeking ways to "do something" about Bitcoin by falsely painting it as something evil, just because some people use it for illegal purposes.

http://www.techdirt.com/articles/20110605/22322814558/senator-schumer-says-bitcoin-is-money-laundering.shtml

alte motive:

"I operate a ~10k botnet using a ZeuS software I modified myself, including IRC, DDoS and bitcoin mining (13GH/s - 20GH/s atm). Everything operating tru TOR hidden service so no feds will take my servers down. (Don't worry, traffic intensive stuff is not tru TOR and the bots work as relays too, enchancing your TOR experience!) Some screens: http://i.imgur.com/yxMDx.jpg (Yes, Rainbow Dash is best pony) "

IAmA a malware coder and botnet operator, AMA : IAmA

Edited August 2, 2012 by dicksi