What Happens When Anonymous Gets a Bank?

[Magda Hassan]

[URL="https://twitter.com/russian_market/status/319012518087503872/photo/1"]

Y[/URL]outh (under 25 years of age) unemployment figures for Europe. Almost 60% in Greece and Spain, nearly 40% in Italy - all countries that have a history of fascism. In Greece the Golden Dawn Nazi party is gaining popular support at a scary rate.

I hear banking pays quite well. For some at least. No doubt some one some where is making a profit in trading youth unemployment futures....

I really don't like the smell Europe is taking on.

No. Quite rank and rancid in fact. Some people's memories are what they should be.

[Peter Lemkin]

Al Jazeera must read this Forum. They just had their first feature story and 30 minute debate on bitcoins. They stated that the current total value of bitcoins was 1.4 Billion USD.

There was a cyber attack from unknown assailants on several bitcoin exchanges on the 1st of April: [my educated guess is that it was not someone from inside the bitcoin community - but more likely someone from the 'traditional' bankster community.]

The sites operated by Paymium, including Instawallet, Bitcoin-Central.net and Paytunia show, at the time of this post, the message:

"Down for Maintenance
We have detected a security breach. Services are temporarily suspended until we have thoroughly investigated the situation."

There is the recommendation that no further deposits to a Bitcoin address for any Instawallet, Bitcoin-Central or Paytunia account be made until further notice.

There was an update posted on Bitcoin-Central to alleviate worry regarding a large transfer from a wallet identified as being Instawallet's. The message in the update describes the transfer as being funds being sent to an address controlled by Paymium, thus the transfer would be the result of protective action.

Without any other communication yet from Paymium staff, a thread on the BitcoinTalk forum ends up being the source for the most comprehensive and up-to-date information on this development.

- http://bitcointalk.org/index.php?topic=164143.0

[Magda Hassan]

What currency is feared by the European Central Bank as a threat to fiat monetary institutions? What currency is cash like but digitally transmittable allowing for ultimate anonymity and global mobility? What digital currency is up over 2,200% over the last year? The answer? Bitcoin. From mining, supply, demand, and security, Visual Capitalist's infographic covers it all.
http://www.zerohedge.com/news/2013-04-04...n-standard

[David Guyatt]

Do you hear that Mr. Anderson, that is the sound of inevitability...

The opening salvo?

Hack attacks hit Bitcoin exchange rates

Online services and exchanges dealing in Bitcoins have been hit by hack attacks that led to a drop in the value of the virtual currency.
Trading on the MTGox exchange, which handles most trades in Bitcoins, was sluggish yesterday as the site fought off an attack.
The attack helped to force a swift fall in the price of Bitcoins.
In addition, the Instawallet website - where people store Bitcoins - is offline indefinitely after an attack.
Website bombardedThe value of Bitcoins surged to a new high this week with each one worth about $142 (£94). Barely a week ago, each virtual coin was worth only $90.
But Bitcoins dropped sharply in value as the MTGox exchange came under a sustained attack by hackers. The vast majority of trade in Bitcoins takes place via the site.
In a tweet on its Twitter feed, MTGox said it was fighting off adistributed denial-of-service (DDoS) attack, which involves a site being bombarded with huge amounts of data. The attack was one of several against the site this week,
The attacks, coupled with a spike in trading volumes, combined to cause delays in trades being confirmed and led the value of Bitcoins to drop sharply to about $120.
Continue reading the main story

"Start Quote

The attacks could be the work of malicious hackers who were trying to 'game' the MTGox exchange"

The attacks could be the work of malicious hackers who were trying to "game" the exchange and manipulate the value of Bitcoins so they could cash in, MTGox said in an interview with ComputerWorld. Attackers are thought to be working to a cycle in which they sell Bitcoins when values are high, then mount an attack that forces prices to crash, buy up the cheaper coins and then let the value climb again.
MTGox said it did not know when or if the attacks would cease but said Bitcoin owners should not panic and sell off as values fluctuated. A spokesman for the exchange added that it was in the middle of rebuilding its trading technology but the new system, which would do a better job of handling the high volume of trades, would not be ready until the end of this year.
In a separate development, Instawallet has shut down "indefinitely" after hackers "fraudulently accessed" its core database. In a statement posted on the Instawallet site it said it planned to open a claim process shortly so people could reclaim their Bitcoin balance.

[Dawn Meredith]

Damn, bet a lot of big time drug dealers will be interested in this system. Sounds great but scary overtones.
I was just telling Erick yesterday that I want our savings out of the bank before the Cypress situation hits the US.
And I was actually thinking of UNDER the bed.
I have no clue how to sign up with this place. Or with hackers if that would even be any safer than the
thieving bankers.
Not that we have a lot saved for retirement...
I will continue to watch this thread.
Caveat Emptor.

Dawn

[David Guyatt]

Not so much money as a way of making money it seems. An ideal investment for manipulation, I would think?

Bitcoin panic selling halves its value

The Bitcoin virtual currency lost half its value on Wednesday because of a panic sell-off.


From a high of $260 (£169) for each Bitcoin, the value dropped to about $130 (£84) in just six hours.


The selling frenzy began as Bitcoin's main exchange, MTGox, struggled to keep up with the volume of trade in the virtual currency.


MTGox said it was working hard to improve the exchange to avoid future trading problems.


Free money
The high of $260 marked the end of a steep rise in value for Bitcoins, which were worth only $90 each two weeks ago. On Thursday, values recovered slightly to reach about $160 (£104).


In a statement explaining what happened, MTGox said the delays in trading had not been caused by a hack attack. In the past few weeks the exchange, and the bitcoin community, has been targeted by hackers looking to cash in.


Instead, said MTGox, the "rather astonishing" number of new accounts that had been opened in the past few days caused a bump in trading volumes that it was unprepared for. In one day, the number of trades in Bitcoins had tripled, it said.


This caused "lag" or delay, which meant that Bitcoins were not swapped between people as fast as needed.


"As expected in such situation people started to panic, started to sell Bitcoin in mass (panic sale) resulting in an increase of trade that ultimately froze the trade engine," it said. About 80% of all the trade in Bitcoins goes through MTGox.


Engineers were working to improve the MTGox trading engine to handle the huge number of transactions, it said. The exchange added that it was planning to shut down for a couple of hours to add servers to help cope with the load.


Tech news site Ars Technica linked the crash to the antics of an anonymous Bitcoin owner who gave away around $13,000 in Bitcoins via the Reddit social news site. The unnamed person, who used the alias Bitcoinbillionaire on Reddit, randomly picked 13 different people to receive the coins. One lucky Redditor got a gift of about $5,000 (£3,250).


The vast increase in interest in Bitcoins is also creating problems for some established members of the digital cash community.


Bitcoins are created, or mined, when computers complete a complicated mathematical problem. Many individuals have pooled their computer power to ensure this mathematical work is completed more quickly.


But the rising value has meant the MT Red mining pool, which is co-ordinated via Reddit, cannot keep up with its financial obligations to its pool members and is shutting down. The "soaring price" has made it impossible for MT Red to cover what it owes to members, an administrator said.

[Peter Lemkin]

Butterfly Labs Announces Next Generation ASIC Lineup

Largest SHA256 Hardware Manufacturer Acquires Venture Capital Funding

(PRWEB) June 15, 2012
Butterfly Labs (BF Labs Inc.), a market leader in microprocessor design, is unveiling today the technical specifications for three of its next generation SHA-256 processor based BITCOIN GENERATOR products:


1) BitForce SC Jalapeno: a USB powered coffee warmer providing 3.5 GH/s, priced at under $149

2) BitForce SC Single: a standalone unit providing roughly 40 GH/s, priced at $1,299

3) BitForce SC Mini Rig: a case & rack mount server providing 1 TH/s, priced at $29,899

"Butterfly Labs has always considered itself a serious manufacturer in the SHA-256 hardware industry and our customers are leaders in providing hashing services for some of the world's great technological challenges," noted Nasser G, BFL CTO. "We see the BitForce SC lineup as the natural next step in continuing to meet our customer's needs."

Because our first and second generation equipment is expected to be outpaced very quickly by the new hardware, customers who have purchased earlier generation products will be able to trade them in at 100% of their value toward the purchase of SC-generation hardware.

Venture Capital Funding Acquired, Record Rate of First Quarter Growth.............[it drones on about their Venture Capital.....].....


NOTE: Buy a couple of #3 and aquire some free electricity [college dorm or workplace hidden closet, etc.] and you will be doing OK....Jose' - come to think of it, that 1 THz/s processor must need SERIOUS cooling...perhaps liquid N2?....

[Lauren Johnson]

Damn, bet a lot of big time drug dealers will be interested in this system. Sounds great but scary overtones.
I was just telling Erick yesterday that I want our savings out of the bank before the Cypress situation hits the US.
And I was actually thinking of UNDER the bed.
I have no clue how to sign up with this place. Or with hackers if that would even be any safer than the
thieving bankers.
Not that we have a lot saved for retirement...
I will continue to watch this thread.
Caveat Emptor.

Dawn

Why put it under the mattress when you can put it IN the mattress with the Matress Safe?

http://newsfeed.time.com/2013/04/03/the-...ish-banks/

[Magda Hassan]

The Real Significance of the Bitcoin Boom (and Bust)

By Michael SivyApril 12, 201324 Comments


Sean Gallup / Getty ImagesA sticker on the window of a local pub indicates the acceptance of Bitcoins for payment on April 11, 2013 in Berlin.
The volatile rise and fall of Bitcoins has prompted lots of stories explaining why the online virtual currency is a classic bubble. Many compare it with Tulipmania in 17th Century Holland, where the prices of rare tulip bulbs soared to absurd heights and then crashed, ruining the speculative investors who had bought them. But the Bitcoin phenomenon is more than a bubble. It says something important about the current and future state of the global economy.
The scale of the recent boom and bust has been staggering indeed. At the start of the year, a Bitcoin was worth $13.51. Earlier this week, it traded as high as $266. And on Thursday, it plummeted to less than $100, as one of the exchanges where Bitcoins are traded closed temporarily. This would be comparable to the exchange rate for the British pound soaring from $1.62 (where it was on Jan. 1) to $31.90 and then falling back to $12.
Such monumental appreciation and volatility is clearly the result of speculation people buying the online currency just because they think its value will rise, not because they want to use it to purchase goods and services. But Bitcoins' gains are not the result of speculation alone. They partly reflect the fact that the Bitcoin system is much better designed than previous online currencies. And more significantly, the runup also reflects anxiety about the safety of the global banking system and the stability of major international currencies.
(MORE: No Money, No Problems: Canada Considers Completely Digital Currency)
The technicalities of the Bitcoin system are complex, but to make this online currency more successful than previous versions, the designers overcame two key challenges. First, to prevent counterfeiting, they attached a history of transactions to each currency unit but allowed users to keep their transactions nearly anonymous. Counterfeiting is hard because fake Bitcoins would need an authenticated history to pass muster.
Second, they strictly controlled the supply of Bitcoins outstanding thereby saving it from the disastrous fate of, for example, the paper currency known as assignats that were issued during the later stages of the French Revolution. Initially, assignats were backed by land and buildings that had been seized from the Church. If the French Government had issued only enough assignats for that property, there would have been plenty of assignats to spend until the property was disposed of. But the Government liked having extra money and didn't cancel the assignats as the property was sold. In fact, France kept printing more, and within five years there was very serious inflation.
Unlike assignats, Bitcoins have no backing at all. What they do have, however and what has turned out to be more important is a formula limiting the growth of the supply outstanding. Over time the formula for the Bitcoin supply actually reduces the amount of new currency added to the system. And the new Bitcoins are not created by fiat, but in exchange for valuable labor: They are paid to computer hobbyists who monitor the Bitcoin system to keep it running and prevent counterfeiting.
Critics have argued that a currency like Bitcoins would be inherently deflationary because the supply can't be adjusted in reponse to economic conditions. The same argument could be made about a gold standard, of course, or an extremely hard currency like the Swiss franc. Moreover, the relatively small supply of such hard currencies means that the inflow and outflow of hot money can make them highly volatile. The price of gold, for example, climbed from less than $300 an ounce 11 years ago to almost $1,800 late last year before dropping to $1,564 today; and the Swiss franc rose from $0.82 in 2008 to $1.38 three years later before settling back to $1.07.
But there's a strong argument that the appreciation and volatility of all these currencies reflects reasonable concerns about the global economy and banking system. The economic debacle in Cyprus keeps getting worse, after all; in fact, the losses there figure to be far greater than any that have occurred in the Bitcoin universe. In addition, the Federal Reserve, the European Central Bank, and the Bank of Japan are pumping out money like French assignats.
Of course, real countries do have massive wealth backing their currencies and their bonds, as well as the police power to arrest counterfeiters. And as I've argued in an earlier article, the U.S. dollar appears to be in better shape for the near term than most other major currencies. But the Bitcoin is doubtless only the first well-designed online virtual currency and is sure to be followed by Bitcoin 2.0 and other even more sophisticated successors.
Could these online currencies ever reach a level at which they altered or obstructed government policy? President Clinton's adviser James Carville famously joked that if he were reincarnated, he would want to come back as the bond market because "you can intimidate everyone." Just as the so-called bond vigilantes acted as a brake on Washington's fiscal policy in the 1990s, one day "currency vigilantes" could act as a similar brake on monetary policy.
The Internet will almost certainly offer access to a growing number of currencies in one form or another that are beyond national control. If a future Fed Chairman tries to repeat Ben Bernanke's policy of Quantitative Easing (effectively printing money), worried investors could start pulling their savings out of the dollar and send it streaming into the Cloud so fast that the Fed would be forced to change course.
Governments will fight back, no doubt. But virtual currencies will be no easier to control than Facebook. Stopping the movement of capital will be possible only if countries are willing to impose harsh taxes and capital controls. Once alternative currencies are frictionlessly available on the Internet, every laptop will become its own Cayman Island. However the current boom-and-bust plays out, Bitcoin is the beginning of something, not the end.
http://business.time.com/2013/04/12/the-...e-mostpop2

[Magda Hassan]

And So It Begins: The Feds Target Bitcoin Transactions

Homeland Security freezes currency transfers between payment service Dwolla and the Mt. Gox Bitcoin exchange.

By Josh Harkinson

May 15, 2013 "Information Clearing House" -"Mother Jones" - In what may be the first move toward a federal shutdown of the wildly popular online currency known as Bitcoin, the Department of Homeland Security today issued an order that has restricted the transfer of funds in and out of Mt. Gox, the Bitcoin exchange that handles some 60 percent of the transactions.

A creation of bank-fearing techies, Bitcoins are now worth more than $1 billion, and consumer interest has been skyrocketing. For more background, read our Bitcoin explainer.

The DHS is focusing on Dwolla, an online payment system (sort of like PayPal) that has become a popular way for Bitcoin users to transfer money to and from Mt. Gox. A Dwolla spokesman confirmed to BetaBeat that DHS and the US District Court for the District of Maryland have issued a "seizure warrant" for funds associated with the company's Mt. Gox account, which is known as Mutum Sigillum.

"In light of the court order," Dwolla told BetaBeat, "...Dwolla has ceased all account services associated with Mutum Sigillum."

The shutdown was first brought to light earlier today by Chris Coyne, the founder of OKCupid, who posted the following screenshot of an email from Dwolla notifying him of the DHS crackdown:

The reason for the seizure is not entirely clear. Up to a point, Bitcoins may be allowable under federal law, but "if Bitcoins facilitate too much drug-dealing or money laundering, the US government could make their production illegal," Harvard public policy lecturer Steven Strauss wrote recently on the Huffington Post . And, of course, there are federal statues making it illegal to produce a separate currency.

Calls and emails from Mother Jones to Mt. Gox, Dwolla, and DHS were not immediately returned.
http://www.informationclearinghouse.info...e34951.htm