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Moon The Loon

Bitcoin - Real Alternative Or International Pyramid Scam?

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I first heard of these "things" about a year ago. I think the process was well under way amongst some folks all over the world at the time.

Now the press seems to have vaulted the Bitcoin into our lives and the entire operation is now public, with the equivalent of ATM's popping up everywhere. Yesterday, I heard an interview from a professor/instructor at some Montreal financial training institute (don't know which one) and all he seemed to offer were emotional, vague justifications that the Bitcoin is the best new monetary device since money was invented. He extolled the fact it was unregulated.

Mid interview, the current value of the Bitcoin was discussed - he said somewhere in the vicinity of USD$800 per. Then he went on to say that less than a year ago, they were in the penny-stock value.

A good friend who is very familiar with the process (I guess it has to do with acquiring massively encrypted "pieces" of mathematical chains of some kind or another) tried to explain how it started, how it has the potential to wreck current international forms of finance and a lot of other things I couldn't fathom, and how current financial systems and centres of wealth are scared their empires might crumble in the face of this new unregulated form of commerce.

The ONLY thing that jumps out at me about this entire thing is in the shape of a giant pyramid named Ponzi.

For the record, none of the above was "copied" from anywhere. They're my thoughts and questions about something that is so radical, I feel like a caveman witnessing an airplane passing overhead.

Anyone got anything to make this make more sense (cents?)??

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Bitcoin is worth what you think when buying and what the other party wants when selling.

What can go wrong?

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Bitcoin is about as speculative as betting on Jai Alai and a bit more risky than betting on the price of gold or diamonds whose price is not based on any real (big) value to humankind, but on a perceived value based on emotion and controlled by the same guys that are paying off the Jai Alai players.

It has no real value as a currency as it is not widely accepted. If you have a circle of drug dealers (who use bitcoins to hide cashflow) or computer geeks who like to use it for trade, that's probably ok, but somebody is going to get caught holding the potato when it crashes because, at some point, someone needs to buy stuff in dollars. Every bitcoin transaction is recalculated using the current exchange rate, so why would the average person use bitcoins? It would be fair to say that even drug dealers check the exchange rate before agreeing on a price. If a kilo of coke is worth $20,000, that's about 30 bitcoins. If the bitcoin is worth $500 next week, I can guarantee that that same kilo will be worth 40 bitcoins, not 30. But it will still be worth 20 large.

If you are still holding the 30 B that you got last week, you just lost 5000 bucks... if the price went up, you got lucky.

Those same, wild swings mean that if you get paid in bitcoins, your purchasing power goes on wild swings, unless everything you do is in bitcoins which I don't see happening.

Those that are holding them are just like the guys that are holding diamonds right now. They're doing everything they can to make them seem desirable so that demand goes up and their pockets get stuffed.

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Moon, with few exceptions, everything in life is a "Ponzi scheme" if you are the unlucky **bleep** who ends up on the bottom. Bitcoins..... Bought at $0.01 and sold at $1100 = 'GREAT investment!' Bought at $1100 and sold at $0.01 = 'Ponzi scheme!'

So true.

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Bitcoin is about as speculative as betting on Jai Alai and a bit more risky than betting on the price of gold or diamonds whose price is not based on any real (big) value to humankind, but on a perceived value based on emotion and controlled by the same guys that are paying off the Jai Alai players.

Exactly. Currency markets are manipulated too but at least we know some of how it's rigged. With the whole Bitcoin scheme the manipulation is completely hidden.

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Oh, like the valuation of gold isn't??

Any of these pseudo currency's valuations are rigged.... gold, diamonds, silver, bitcoins. Gold has NO REAL VALUE, except a little bit in the electronics manufacturing process. But, somehow, the manipulators have convinced us that it is a place to put dollars in times of "uncertainty". And its sparkly and relatively rare, so people like to adorn themselves with it so they can show off their status in society. You can't even wear a bitcoin.

We don't price our homes or a loaf of bread or an airline seat in ounces of gold, we price them in dollars, because dollars are fairly stable and represent real work and worth within an economic environment.

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http://www.theglobeandmail.com/report-on-business/international-business/us-business/two-bitcoin-exchange-operators-charged-in-money-laundering-scheme/article16517989/

Two Bitcoin exchange operators charged in money laundering scheme

NEW YORK — Reuters

Published Monday, Jan. 27 2014, 11:29 AM EST

Last updated Monday, Jan. 27 2014, 11:49 AM EST

U.S. prosecutors on Monday announced charges against two men operating Bitcoin exchange businesses for attempting to sell $1 million in the digital currency to users of the underground black market website Silk Road, which was shut down by authorities in September.

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^^Well some people are selling their house for Bitcoin.

A lady in Alberta has offered her house up for Bitcoin, I would post the link but the mods still haven't fixed the forum software to allow IE11 users to cut and paste or quote.

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Reprinted from an adjacent thread:

http://www.theglobea...rticle17077739/

I wish I was wrong, but it sure isn't looking like it:

Bitcoin exchange Mt. Gox disappears in blow to virtual currency

Ruairidh Villar and Sophie Knight

TOKYO — Reuters

Published Tuesday, Feb. 25 2014

Mt. Gox, once the world’s biggest bitcoin exchange, looked to have essentially disappeared on Tuesday, with its website down, its founder unaccounted for and a Tokyo office empty bar a handful of protesters saying they had lost money investing in the virtual currency.

The digital marketplace operator, which began as a venue for trading cards, had surged to the top of the bitcoin world, but critics – from rival exchanges to burned investors – said Mt. Gox had long been lax over its security.

(snip)

A document circulating on the internet, and purporting to be a crisis plan for the exchange, said more than 744,000 bitcoins were “missing due to malleability-related theft”, and noted Mt. Gox had $174-million in liabilities against $32.75-million in assets. It was not possible to verify the document or the exchange’s financial situation.


WOW. :blush:

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The latest:

http://business.financialpost.com/2014/02/28/bitcoin-exchange-mt-gox-files-for-bankruptcy-admits-losing-850000-units-of-digital-currency/?__lsa=2b0c-d40d

It would seem they were hacked -

Bitcoin exchange Mt. Gox files for bankruptcy, admits losing 850,000 units of digital currency

Yoshifumi Takemoto and Sophie Knight, Reuters | February 28

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It would seem they were hacked -

Got some time to waste? Just google "bitcoin conspiracy"......

Bitcoin may have been created by the NSA to facilitate easier tracking of financial transactions or it may have been created by the US government as a way of subverting the Chinese government from eventually replacing the US dollar as the world's primary currency or it may have been created by shadowy fanatics who are attempting to create a NWO (new-world-order) or it may have been created by DARPA or it may be drug dealers looking for a more anonymous way to transfer large sums of money, etc, etc.

Personally, I don't know who or what is behind Bitcoin but I'm very very, suspicious of the whole thing.

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Guest longtimer

appears we are seeing the 2nd closure of a "major bitcoin" bank. Japan-based Mt. Gox being the first.

The theft has forced the first Bitcoin bank to close its doors

Flexcoin, the Canada-based Bitcoin bank, is to close after losing $600,000 in a hacker attack.

Its entire stock of Bitcoins stored on-line, in its so-called "hot wallet", were stolen.

Coins held in "cold storage" or in servers not connected to the internet were not taken.

Last week, the world's biggest Bitcoin exchange, Mt Gox, filed for bankruptcy protection after it suffered a $500m theft.

Bitcoin is a digital or crypto-currency which is bought and sold online, but not backed by any country's central bank or government.

Continue reading the main story

Start Quote

As Flexcoin does not have the resources, assets, or otherwise to come back from this loss, we are closing our doors immediately”

End Quote

Flexcoin statement

Flexcoin called itself the first Bitcoin bank. It provided centralised storage and enabled instant free transfers between Flexcoin customers.

It said in a statement: "On 2 March 2014, Flexcoin was attacked and robbed of all coins in the hot wallet. The attacker made off with 896 [bitcoins].

"As Flexcoin does not have the resources, assets, or otherwise to come back from this loss, we are closing our doors immediately.

http://www.bbc.com/news/business-26446142#

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And so, the saga looks like it might be approaching its final episodes:

http://www.theglobeandmail.com/globe-debate/columnists/theres-a-reason-heroes-dont-live-in-the-burbs/article17371471/

There’s a reason heroes don’t live in the burbs

TABATHA SOUTHEY

The Globe and Mail

Published Friday, Mar. 07 2014, 8:49 PM EST

Last updated Friday, Mar. 07 2014, 8:51 PM EST

From the article:

Already dealing with the virtual collapse of their virtual currency, and several of their exchanges, Bitcoiners have little left to cling to but their creation myth. And Leah McGrath Goodman’s story appeared to some to have robbed them of that.

The myth has long (well, for an Internet eon anyway – about five years) been told of an unknown person or people who individually or collectively, but most importantly to the story, mysteriously, led the development of Bitcoin.

Having a nebulous entity as a founder can really galvanize a group. He/she/they can more easily embody an entire community’s ideology. But the revelation that, according to Ms. McGrath Goodman, Mr. Satoshi Nakamoto is a 64-year-old model train aficionado who at age 23 changed his name from “Satoshi Nakamoto” to “Dorian Prentice Satoshi Nakamoto” is a difficult story to romanticize.

Snake oil, anyone?

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Guest longtimer

If you were "Bit"

http://globalnews.ca/feed/

Mt. Gox bitcoin exchange files for bankruptcy in US

‎Today, ‎March ‎10, ‎2014, ‏‎24 minutes agoGo to full article

DALLAS – The Mt. Gox bitcoin exchange that recently collapsed in Japan has filed for U.S. bankruptcy protection to shield itself from a lawsuit seeking to repay thousands of people whose digital currency is now missing.

The U.S. filing made in Dallas late Sunday supplements a bankruptcy petition that Mt. Gox submitted in Japan at the end of last month.

Mt. Gox was once the world’s largest exchange specializing in bitcoins, but now finds itself in a financial mess after losing about 850,000 bitcoins valued at $473 million, according to court documents.

Although it’s based in Tokyo, Mt. Gox is opening a bankruptcy case in the U.S. in an attempt to delay a recent federal lawsuit filed in Illinois on behalf of all U.S. residents burned by the exchange’s abrupt demise.

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https://www.theglobeandmail.com/globe-investor/inside-the-market/market-updates/bitcoin-tumbles-more-than-25-per-cent/article37417347/

Bitcoin tumbles more than 25% as sharks ‘beginning to circle’

Samuel Potter and Eddie van der Walt
Bloomberg News
Published December 22, 2017

The profit taking is enormous...

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http://business.financialpost.com/technology/blockchain/update-2-bitcoin-jolted-by-regulation-worries-falls-7-pct-on-extended-selloff

‘Bitcoin is deciding whether this is the moment to crash and burn’ — down another 12% this morning

Investors are spooked by fears regulators might clamp down on an asset whose value has skyrocketed

Tommy Wilkes and Hideyuki Sano

January 17, 2018
8:11 AM EST

***********************************

https://www.theglobeandmail.com/globe-investor/bitcoin-jolted-by-regulation-worries-falls-7-on-extended-selloff/article37632375/

Bitcoin slumps to $10,000, half its peak price, as regulatory fears grow

Hideyuki Sano and Tommy Wilkes
TOKYO/LONDON
Reuters
Published January 17, 2018Updated 2 hours ago

************************************

The beginning of the end? Did anyone on this forum or anyone you know "invest" in this thing in the last 6 months? Did anyone actually make money during its run?

Edited by Moon The Loon

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Quote

After the bitcoin boom: hard lessons for cryptocurrency investors 

 
Nathaniel Popper and Su-Hyun Lee
Published 2 Hours Ago Updated 1 Hour Ago The New York Times
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Tony Yoo, a financial analyst, at home in Playa Vista, Calif., Aug. 17, 2018.
Rozette Rago | The New York Times
Tony Yoo, a financial analyst, at home in Playa Vista, Calif., Aug. 17, 2018.

SAN FRANCISCO — Pete Roberts of Nottingham, England, was one of the many risk-takers who threw their savings into cryptocurrencies when prices were going through the roof last winter.

Now, eight months later, the $23,000 he invested in several digital tokens is worth about $4,000, and he is clearheaded about what happened.

"I got too caught up in the fear of missing out and trying to make a quick buck," he said this week. "The losses have pretty much left me financially ruined."

 

More from The New York Times:
As bitcoin bubble loses air, frauds and flaws rise to surface
Here's some cryptocurrency. Now please use it.
Subpoenas signal SEC crackdown on initial coin offerings

Mr. Roberts, 28, has a lot of company. After the latest round of big price drops, many cryptocurrencies have given back all of the enormous gains they experienced last winter. The value of all outstanding digital tokens has fallen by about $600 billion, or 75 percent, since the peak in January, according to data from the website coinmarketcap.com.

The virtual currency markets have been through booms and busts before — and recovered to boom again. But this bust could have a more lasting impact on the technology's adoption because of the sheer number of ordinary people who invested in digital tokens over the last year, and who are likely to associate cryptocurrencies with financial ruin for a very long time.

show chapters

"What the average Joe hears is how friends lost fortunes," said Alex Kruger, a former banker who has been trading in the cryptocurrency markets for some time. "Irrational exuberance leads to financial overhang and slows progress."

It is hard to know how many cryptocurrency investors are now in the red, with holdings worth less than the money they put in. Many who have lost money in recent months had gotten into the markets before the big run-up last year, and their holdings are still worth more than their initial investments.

But by many metrics, more people put money into virtual currencies last fall and winter than in all of the preceding nine or so years. Coinbase, the largest cryptocurrency brokerage in the United States, doubled its number of customers between October 2017 and March 2018. The start-up Square began allowing the users of its mobile app, Square Cash, to buy Bitcoin last November.

Almost all of the new customers on Coinbase and Square would be in the red if they bought cryptocurrencies at almost any point over the last nine months and held on to them.

The damage is likely to be particularly bad in places like South Korea and Japan, where there was minimal cryptocurrency activity before last year, and where ordinary investors with little expertise jumped in with abandon.

In South Korea, the biggest exchanges opened physical storefronts to make it easier to invest for people who didn't feel comfortable doing it online. The offices of one big exchange, Coinone, had just one customer walk in during a two-hour period in the middle of the day last week. An employee, Yu Ji-Hoon, said "the prices of the digital tokens have fallen so much that people seem to feel upset."

Kim Hyon-jeong, a 45-year-old teacher and mother of one who lives on the outskirts of Seoul, said she put about 100 million won, or $90,000, into cryptocurrencies last fall. She drew on savings, an insurance policy and a $25,000 loan. Her investments are now down about 90 percent.

"I thought that cryptocurrencies would be the one and only breakthrough for ordinary hard-working people like us," she said. "I thought my family and I could escape hardship and live more comfortably but it turned out to be the other way around."

In the United States, Charles Herman, a 29-year-old small business owner in Charleston, S.C., became obsessed with virtual currencies last September. He said he now felt like he had wasted 10 months of his life trying to play the markets.

While he is essentially back to the $4,000 he put in, he has soured on the revolutionary promises that virtual currency fanatics made for the technology last year and has resumed investing his money in real estate.

"I guess I thought we were 'sticking it to the man' when I got on board," Mr. Herman said. "But I think 'the man' had already caught on, and had an exit strategy."

Much of the anger that investors feel is toward the smaller virtual currencies, or alt coins, that entrepreneurs sold in so-called initial coin offerings. These coins were supposed to serve as payment mechanisms for new software the entrepreneurs were building.

But almost none of these companies have delivered the software they promised, leaving the tokens useless, except as speculative assets. Several coins have been exposed as outright scams.

"I think I'd like to see most alts go to zero before I feel like the whole space isn't overpriced," Mr. Herman said.

Bitcoin has generally held on better with investors. It is down about 70 percent from all-time highs, rather than the 90-percent losses that lesser-known digital tokens have suffered. But it, too, has struggled to win much usage beyond speculative investments.

"We also saw that Bitcoin isn't ready for mass adoption and day-to-day use," Mr. Herman said.

Despite this pessimism, the social networks where cryptocurrency fanatics gather to trade information are full of people talking about their intention to hold on to their coins, in the hope that they will recover once the technology has time to catch up with the hype.

Tony Yoo, 26, a financial analyst in Los Angeles, invested more than $100,000 of his savings last fall. At their lowest point, his holdings dropped almost 70 percent in value.

But Mr. Yoo is still a big believer in the idea that these tokens can provide a new way to transact online, without the big corporate middlemen we rely on today. Many of the groups that raised money last year are still working on the products they promised, with lots of serious engineers drawn to the projects.

"There's just so much more behind this new wave of technology and innovation that I'm sure will take over our society in due time," Mr. Yoo said.

With prices down so much, he said he was actually looking to put more money into the markets.

That thinking has been encouraged by the people who invested in Bitcoin in 2013, when it first topped $1,000. That bull market was followed by a crash in which the price of Bitcoin dropped more than 80 percent. But after a long fallow period, the price recovered. Even with recent losses, the value of one Bitcoin is hovering around $6,500 — up more than 500 percent from the peak of 2013.

"Five years ago, I was broke, unemployed, and ashamed to use my real name," Ryan Selkis, a popular virtual currency personality, wrote on Twitter last week. "For the new fanatics, stick around for your own 14 month, 85% downdraft and you'll not regret it."

Twitter is also filled with complaints, like the one from a user named @Notsofrugaljoey, who wrote: "It's really hard to stomach losing all my hard earned money. Just broke down and cried."

On Reddit, a user in the United Arab Emirates posted a picture of the $100,000 loan he'd taken out in December to buy cryptocurrencies — and that he will now be paying back out of his salary for the next three years.

Mr. Roberts, the British investor who has seen most of his $23,000 vanish, is holding onto his coins in case they turn around. But for now he has stopped trading and is looking for another job.

"I'm living off the little savings I have left still in my bank account," Mr. Roberts said. "I've made a mistake and now I'm going to have to unfortunately pay the cost for the next few years."

WATCH: Bull vs. bear on bitcoin

 
show chapters

 

 

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https://www.npr.org/2019/02/04/691296170/cryptocurrency-exchange-says-it-cant-access-millions-after-founder-s-unexpected?utm_campaign=storyshare&utm_source=facebook.com&utm_medium=social&fbclid=IwAR2oVOKH6nhYYHMp9kYGiDoDsOm74MvE4tP48yt9jynAYy66F9cs42A1Cjw

You pays your money, you takes your chances:

Cryptocurrency Exchange Says It Can't Access Millions After CEO Unexpectedly Died

The QuadrigaCX cryptocurrency exchange says it can't access some $190 million in bitcoin and other funds after its founder and CEO, Gerald Cotten, died at age 30 — without sharing the password for his encrypted laptop.

Cotten was "the sole officer and director" of the Canadian cryptocurrency exchange when he died, said his widow, Jennifer Robertson, in an affidavit that is part of the company's request for court assistance as it seeks protection from its creditors.

The debt filing comes weeks after Robertson announced that Cotten had died — an event she described as "a shock to all of us."

Edited by Moon The Loon

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