No telling, but it's not the first time DHS has shot first and asked questions later.

Perhaps they were alerted by suspicious transaction reports filed by Gox's U.S. banks or banks wiring to them in Japan. Gox has said that the amount of money flowing into the exchange has increased dramatically, and those kinds of changes to funds flow are certainly a red flag for bureaucrats.

Well, to be fair, we have no idea what's actually going on. It could very well be a legitimate government action.

That said, yeah, if I wasn't bound by birth and family, I wouldn't move here either. I'm not old enough to know how it was in the halcyon days of postwar America, but post 9/11, our government seems too big and too powerful. Most of us are so busy catching up on Survivor that we just aren't paying attention.

I won't argue with you there, but I'm not the panicky, jump to conclusions type of wall watcher. The facts will reveal themselves, and until then, there's finally some fucking action!

Yes, it's looking like that is the extent of it, which is a relief. Failure to register their US subsidiary as a Money Service Business is completely negligent, but at least this doesn't seem to involve an actual money laundering charge.

The subsidiary, Mutum Sigillum LLC, doesn't appear to be registered on the FinCen site: http://www.fincen.gov/financial_institutions/msb/msbstateselector.html

BTC needs Ripple to achieve legitimacy? Did you read that on a fortune cookie?

Yes, I see that too. Mutum Sigilium was created in Delaware on 05/09/2008. Still, after those FinCen regulations came out last month, there's really no excuse for such an oversight on Gox's part.

Definitely not. Something like this should never lead to jail time. They are registered for their main business so it's obviously just an oversight. I bet a hefty fine is all that will be levied.

I do remember the heavy handed way the Feds dealt with the online poker companies though. Hopefully this isn't that kind of ridiculous overreaction.

It hasn't really only been a month... it's been a few years so someone should have caught it. A multi million dollar company should be able to walk and chew gum at the same time. I doubt their lawyers are manning the Network Operations Center.

I was just saying that the recent news of the regulations should have caused someone over there to make sure they were compliant. Perhaps it does take longer than a month to get registered but I don't think so. It's a simple form that you fill out and submit online.
http://www.fincen.gov/financial_institutions/msb/msb.registration.html

The connection to online gambling makes sense, as the Feds have proven in the past that they will take down payment processers who enable it.

A few years ago, the Australian owner of a payment processor was arrested while he was in Vegas.
http://www.pokernewsdaily.com/internet-gambling-payment-processor-arrested-in-las-vegas-9864/

And there have been many other processors that have had their funds seized for getting anywhere near gambling.

I get that you're ticked off, but no one, anywhere should lose their freedom because one of the thousands of government forms wasn't completed. That there are criminal penalties for this kind of thing at all is surely a sign of the apocalypse.

Civil fines, yes. Criminal penalties, GTFO.

As for Gox and their incompetence, let the market decide their fate.

I believe it's actually Coinseeker who acknowledged that. :-)

Where's the sauna vault?  

I can't imagine anyone would say that or even imply it. Complaining is what you should do, but when you start advocating for someone to be locked up, the rest of your arguments get tainted by the crazy.

I believe they use Cloudflare and Prolexic to handle DDOS. I'm not sure how that applies to their trading engine though... it seems like they get flooded with huge numbers of .01 ask/bid adds and removes, and then the lag starts.

Actually, following up on that... I've noticed a lot of asks/bids with zero quantity scrolling by on clark moody, such as this:



No idea what that's about.

It's hard to tell what's going on now since most people can't even get the site to load, but I converted the dollars I had on Gox to BTC and moved them off this morning. I really don't think anything major will come of this Dwolla situation but this morning it was all kinda muddy and I feel better with it in Armory for now.

I've traded on Bitstamp through Bitfinex but I did setup a direct account yesterday and yeah, it is pretty nice. Now onto verification.

I think the point is that there are serious people outside of the Bitcoin community investing, or talking about investing, which for most people, lends an aura of legitimacy and the promise of widespread adoption.

There's no question that VC's make mistakes, in fact, that's part of the business model. But compared to the sophistication of the average investor in the BitcoinTalk securities marketplace, I'd say this new money can rightfully be called smart money.

I withdrew BTC successfully but it was earlier in the day, around noon EDT.

Edit: Oh, I see you got yours too. Cheers.

You're as transparent as used Neutrogena.

Satoshi Dice has announced that it's blocking U.S. IP addresses from accessing the site:
https://bitcointalk.org/index.php?topic=77870.msg2164694#msg2164694

Lot's of red over at MPEX http://mpex.co/?mpsic=S.DICE

I don't think anyone seriously ever believed that, did they?

Anyway, I went through the poker stuff years ago and the adult biz before that. The government rattles it's sabers and takes down a few big players and then moves on to something else. They will never stop people from doing the things they want to do, they just make it require a little more creativity, e.g. US residents are still playing online poker.

That said, knowing what a hard on the Feds have for online gambling, I can't believe evoorhees has been so public about his ownership of that site. Seems reckless.

All of this is interesting for those of us trading, but I don't think it has anything to do with the success of Bitcoin.

Yeah, this is actually the best news in a while. Adoption of Bitcoin by entrenched players that make it easy to buy goods and services is much more exciting than VC investment into new exchanges, etc.

Echo chambers are bad, but there's a difference between legitimate argument and FUD. Coinseeker is fast becoming Elmer FUD.

This is an exaggeration of recent events at best, which relate to one company's (completely avoidable, most likely) issue with a regulator. As for Satoshi Dice, that has been reckless for an American to own all along.  It has nothing to do with Bitcoin.

Connecting these events to a government plot to tie BTC to terrorism is an example of rhetorical gymnastics worthy of McKayla Maroney.

I thought you made that up at first. Damn

I've seen fictitious personalties shine bright and burn out on other boards, but reptile might have the record for flamboyance and melodrama. Good show!

Edit: Do psych wards have wifi? 

I don't care if your "rpietila" persona is real or not. Our identities are mostly just stories we tell ourselves anyway, and yours is comedy gold. We may all be worms, but you sir, are a glow worm (borrowed from Churchill, I think).

Get some rest and come back soon.

Bitfinex is already routing through Bitstamp, but maybe there's another exchange coming online.

I think you're right. Gox hasn't exactly been communicative about these recent events, and anytime a company's name appears on a seizure warrant it takes uncertainty to a whole new level. It's a bit reckless to leave money there until things become clearer.

I'm relieved that Bitfinex is reducing their Gox exposure as I have funds with them, but it's been killing me that I can't trade these spreads.

I'm not sure your maths are solid there.

Yeah, I think that's what the announcement dexX7 posted is saying.

If I'm reading it right, prior to April 17th you could place an order without the funds to clear it in your account, and Gox would queue the order and check the funds later, just prior to execution, I'm guessing. Now, they are checking funds on order submission, which they they say will help with system performance.

Edit: crazy spelling

This probably isn't the place for an in depth philosophical discussion, so I'll just say that I don't at all believe those are the only two possibilities. Party on. 

Amazingly my E-Trade account doesn't offer that feature either. ;-)

There are a few facts. One of which is that your Ignore indicator is looking more and more jaundiced.

I appreciate your point and I do think it's unlikely that Gox will face anything other than a fine, but sometimes where there's smoke, there really is fire. I would hesitate to say that it's an overreaction for people to move their assets until things are cleared up.

To my knowledge, Gox hasn't even released a real statement addressing recent events.

Here we go! Afternoon delight (EDT).

Perhaps I've overlooked the increase in Coinseeker's post count as a bullish indicator.

What channel are you watching?

Arb is certainly tempting. My balls are still sore from the Bitfloor kick so I'm staying away for now.

Damn. They probably could have funded 1000 lawsuits against Big Brother had they taken a shot back then.

The CFTC regulates derivatives. You'd think he'd be comfortable with things that don't exist. LOL

Interesting logic. I'd argue that the people who pulled out probably realize the importance of minimizing their risk, and Dwolla's transaction volume is irrelevant to that analysis.

What is relevant is that the company holding our funds is facing an adversary that can seize those funds at will, including offshore funds via the Mutual Legal Assistance Treaty. Whether or not that's likely to happen is up for debate, but in the real world, managing risk is the way people with money keep it.

Right now there are approximately 2200 coins lent out to short sellers and another 1800 available to borrow on Bitfinex, so around 500k USD at today's price. Not a massive sum, but enough to make shorting viable for traders on that platform.

You do have to keep assets on the exchange to cover a potential margin call, and no, there is no naked shorting. Technically, Regulation SHO prohibits naked shorting on U.S. stock exchanges too, not that it doesn't still happen.

As Abandon mentioned, there are already new players coming online, and we'll continue to see more opportunities for shorting as the market matures. I think that's a good thing for market stability.

Yes, IMO a realistic, dispassionate analysis of your investments (or anything really) is incredibly important. I'm definitely a long term BTC bull, but I have to put a lot of effort into staying in touch with reality because I'm my own worst enemy. I've been burnt by my own willful blindness more than a few times.

Unless something big comes out of the conference, sideways through the weekend. Next week? I don't mind admitting that I have no idea.

Lots of good news lately, but lingering uncertainty around the Gox situation has me cautious. If I have to pick, I'm guessing that next week we go up.

Agree on that. I did well with LTC (up 10x) but it was just dumb luck and I only threw $500 into it. I sold out a while back and I think it's significantly overvalued now.

And there's no justification for greed... except for human nature, so is that a design flaw? Could people be bidding XRP up because Ripple itself is difficult to understand?

Anyway, I believe I understand it, and I am unmoved by the anti Ripple arguments based on ideology or pre-mining, but I think it is even harder to explain to consumers than Bitcoin.

Coinseeker, can you summarize why you believe Ripple is iTunes in your analogy? IMO, iTunes was successful because it made it dead SIMPLE to purchase digital music at fair prices, not to mention it was tied to an incredibly well designed piece of hardware, and backed by a monstrous ad campaign. If you agree, how exactly does Ripple change the game like iTunes did?

I'm genuinely curious as I have no dog in the fight (never mined anything), and while I believe in Bitcoin, I'm certainly no fundamentalist.

OK, so if I understand correctly, outside of regulatory issues, IYO the unique selling proposition of Ripple is that is makes it easier to move/exchange funds (BTC and fiat) at lower costs. That leads me to the following observations / questions:

1) Your example of buying BTC via Paypal presupposes that PayPal would allow services that deal in BTC to hold accounts. Similarly, Bank of America, Chase, etc. would each have to sign on to Ripple in order to be a trusted gateway. If this is necessary, isn't it just as likely that Coinbase or some other BTC based service will convince PayPal or a bank to integrate into its system?

2) Assuming Coinbase or another startup can connect with existing financial companies in this way, what advantage does Ripple have? The fees to move money on Ripple may be very low, but legacy financial companies are still going to want their fees whether money moves from their infrastructure to Ripple or Coinbase.

3) Perhaps you think that Ripple has value outside of the BTC ecosystem, for instance, that it could actually disrupt fiat payments and currency exchange by moving it outside of the banking system entirely. As this is exactly what Bitcoin seeks to do, Ripple will face the same problems, namely, getting money into and out of the banking system easily, without their buy in. I think you'd agree that banks aren't going to be disrupted without a fight, in which case, Bitcoin has network and brand advantages over Ripple.

4) You mention that the Bitcoin community has failed to address flaws and regulatory pressures, and that this gives Ripple an advantage. Certainly you must admit that Bitcoin is actively undergoing development and is at least further along in the process than Ripple. At this point, can you even judge Ripple's flaws? Aren't you just relying on the promises of OpenCoin?

As for regulatory issues, whatever some Bitcoin users believe, the main devs have indicated that avoiding regulation isn't really a concern for them. Not to mention, when has a new technology ever NOT gone through a period of uncertainty with regard to regulation? In the U.S. we are still debating whether interstate online sales should be subject to sales tax, and it has been decades.

You may well be right that Ripple addresses some of Bitcoin's problems, but after thinking it through, it seems to me that you aren't comparing Ripple to Bitcoin so much as comparing Ripple to the COMPANIES currently providing service in the Bitcoin ecosystem. I'm not convinced that Ripple has any advantage over either new, well financed, BTC related companies or existing BTC companies that get their act together.

Yeah, sorry for the Ripple talk... I am genuinely curious but it's not really on topic.

I'd appreciate it if Coinseeker would respond but I'll refrain from further discussion of it here.

The lull got me out of the house for a couple days, but enough of that real life shit. Bring on the action!

Can't really blame them. I heard they've been working night and day on regulatory compliance. /snark

Thanks for that. Haven't come across that one.

If that was their plan, they probably wouldn't have telegraphed it by seizing only their US accounts, thereby giving them time to move funds and destroy evidence.

I don't think Mt. Gox will be shut down, but I do not like that they have not even addressed the issue, and I won't risk funds with them until there is some clarity around their position.

As for Bitcoin itself, anything that happens to Mt. Gox will be a temporary setback. New, compliant exchanges are opening and will continue to open.

Great post. I'm beginning to come around to this way of thinking. Low volume has signaled a lack of enthusiasm, and we've lost a few easy ways to get new money into coin (Bitfloor, Dwolla, etc.) over a short period of time.

I'm not sure how making a post here puts any money where anyone's mouth is LOL.

I appreciate reading other people's analyses because we all have our own biases, and it's good to have them challenged. IMO, well considered opinions are much more valuable than meaningless short term price predictions pulled out of the derrière.

I follow r/SilkRoad for a bit of insight into that economy, and outside of vendor reviews, the most frequent problems posted relate to getting money into coins. Many are using BitInstant and Coinbase now, but there are other more underground services, such as Blue Sky Traders, that are also popular.

I'm not aware of an accurate way to gauge the volume on SR or BMR, but I don't detect a falloff in the anecdotal stats I check. SR had significant downtime about a month or so ago though.

Thanks, you put it much better than I did.

LOL! I do miss that guy. He had a special kind of imagination.

LOL! That about sums up my "strategy" for the weekend. Damn, I was really hoping to get some sleep tonight but... can't... stop... watching.

This weekend has been a lot like last week's episode.

The .0134 mechanized division has been called to the front lines.

Maybe he needed that fiat to further pillage the asks with market orders.

Yes, it seems to be gone. Surprised it wasn't just moved up. Everything was hanging for a while for me so I wasn't sure. This guy is calling a DDOS on Gox: http://btcbible.com/ddos-attack-mt-gox/

Pfft. My man drops 10k on sauna rental. It takes a hell of a lot more than that to shake those strong hands.

Welcome back rpietila!

I think the point is that a government actor could most easily destabilize the BTC market this way, and in doing so, make it too risky to use.

A billion dollar market is a tenth of a rounding error to a large government, and if this was carried out in the name of "national security," the costs would be irrelevant (and classified) anyway. They wouldn't care that they enrich a few thousand people in order to shut down a way for evil-doers to finance their operations.

This is an interesting idea to play with, but IMO, highly unlikely. I think they are more likely to apply the necessary pressure to the weak points in the system in order to track and monitor the movement of large sums.

I don't think this is the case. Businesses have transacted in foreign currency for a very long time, but in most countries, you still can't pay your taxes with it. There are long standing accounting rules for handling the conversion of foreign currencies to your home currency and the recognition of the profit/loss derived from the conversion.

I don't see why Bitcoin would be any different. The IRS doesn't want to deal with currency risk in the collection of taxes.

Edit: I stand corrected. Apparently there are people who live overseas and send checks denominated in foreign currency to the IRS in payment of their taxes. However, the IRS puts the currency risk back on the payor, so if there is a shortage after they convert it to USD, the taxpayer owes the balance.

http://www.accountingweb.com/article/tigta-addresses-irs-trouble-processing-foreign-currency-tax-payments/221519

He probably already has those officials in his pocket like a handful of satoshis.

These rules are already well established because businesses who transact globally deal with this everyday. When you actually dispose of your coins, by selling or spending them, you have to account for the gain / loss on the coins you use. This requires record keeping, which is probably the biggest issue for non-business users. Hopefully the IRS and other agencies will issue simplified rules, but they certainly aren't going to look the other way if you have large gains from any activity.

Ah, if you are paid in Bitcoin, it does complicate things a bit. In that case, you use the conversion rate at the time of receipt of the coins to calculate your income, and that then becomes your "basis" in the coins. When you eventually convert the coins to fiat by selling or spending, you recognize the difference between the value you receive and your basis as profit / loss for tax purposes.

You're still pretty young I think, and since aren't asking for advice... I'm going to give it to you anyway. :-)

Take it from someone a little older, cars and fast living won't make you nearly as happy as building up your capital so that you never have to take shit from a boss or a client again. I chased that fast life in LA for years and thought all the toys made the bullshit worth it, but man, when you have freedom, real freedom, to do what you want, when you want... you'll wonder why you ever parted with a penny that didn't have a return attached to it.

If fast cars are your thing, buy one after you build enough capital to never have to work again.

Whoa! Shitstorm is early this week. It's getting to be so you can't even go out to see a matinee anymore. LOL

No, there is no specific allegation in the document, just a general admonishment against violating the statute. California clearly has their wires crossed because, even under the most expansive interpretation of the law, the foundation is not a money transmitter.

They cannot be a money transmitter simply for advocating for Bitcoin as there are first amendment issues preventing regulation of that type of speech.

I hadn't heard that they were mining, but that could subject them to the law if they sell their mined BTC. I can't imagine they would do that after reading the FinCen guidelines.

Even if we stipulate that the apologists are right and Gox is dealing with a minor banking problem, can anyone argue that they have acted professionally and been forthcoming in their communication with customers?

I hope they get their shit together because to many casual users, they ARE Bitcoin. Anyway, the next couple of weeks will be telling, as otherwise patient people will soon start to doubt the safety of their funds.

My schedule almost exactly. I fully expected to wake up with BTC in the mid to low 70's at least.

Uptrend in the medium term perhaps, but I'm seeing a rocky road just ahead. Very rocky if certain worst case scenarios play out with Gox.

Complaints from people who haven't been able to access their funds for many weeks is FUD? Exactly how thick are your rose colored glasses?

Oh, I'm totally bullish about the future too... but perhaps a little further into the future than you. We need well-financed, professionally run companies that actually do what they say they will, and offer a minimum level of customer support. We have very few of those now.

It's also very difficult to purchase BTC in the US right now, which still seems to be the biggest market by far. Keep an eye on the places where new users congregate and you'll see how frustrated they are about getting into Bitcoin. Just over the past couple of months, casual users have had their money held hostage by Bitfloor, locked up by Mt. Gox, and last week, Bit Instant (which is well-funded) temporarily closed up shop. It will take time to rebuild confidence outside of early adopters, so I just don't see any justification for the price to remain at these levels in the medium term.

That said, there's a lot of money to be made regardless of which direction the price moves.

As for the SD sale, I don't think it matters much at all to those outside of shareholders, speculators, and possibly players. I actually doubt there was a real sale at all, but that's just tinfoil hatting based on my reading of Erik's recent behavior.

LOL wut? I think you need to do some more research.

I haven't followed up on this yet, but if true, and they have their banking problems resolved, it is excellent news. The price will probably go down in the short term, but it would help to restore confidence, and we need all of that we can get.

Indeed, Gox has seen incredibly low volume lately.

Does anyone know of a site / service that tracks overall exchange volume, including services like Coinbase? I'm not sure they even release numbers, come to think of it.

But you must realize that this has very little to do with Bitcoin per se, and everything to do with human nature. We aren't especially good at handling cognitive dissonance and are highly influenced by group-think behavior.

He's still here, but posting under his Bizzarro alter ego "Walsoraj"... and he is a negative Nancy.

https://bitcointalk.org/index.php?topic=178336.msg3398364#msg3398364

Drop a lot of acid, do ya? LOL

A pullback after a fast run up like this won't be all that surprising but I no longer think $500 over the next few months is a pipe dream.

Utter nonsense. You obviously don't know the first thing about FinCen regulations. Processing for the sale of goods is not a money transmission activity.

Also, Bitpay has not shut down. Wow.

I have read it and obtained legal counsel on the matter. You are incorrect but keep spreading misinformation if it suits your agenda.

Then you have terrible attorneys. Point them toward the payment processor exemption in 31 CFR § 1010.100(ff)(5), or have them get a guidance letter like the rest of the serious business people in this space.

Bitpay is registered with FinCen, by the way... I just looked it up. Go to http://www.fincen.gov/financial_institutions/msb/msbstateselector.html and type Bitpay in the legal name field.

Yeah, I figured as much.

Anyway, for the genuinely curious, here is Bitpay's response to FinCen related questions:

http://blog.bitpay.com/2013/03/how-fincen-guidelines-affect-bitpay.html