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Financial news I consider important, with my opinion, which is worth as much as you paid for it.
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Saturday, May 18, 2013

Virtual Currencies reach US Government Attention

Bitcoin's primary exchange, Mt. Mox, has been shutdown.   I am giving the benefit of the doubt to the US government, and that Mt. Mox has issues with corruption, violating international laws and accounting issues in it's financial reporting.  And for any critics reading saying the US government has corruption issues, the point is invalid.  The new currency system MUST be held to the highest possible standard and survive.

There are likely millions of organizations globally that have all sorts of black market and money laundering schemes.  The timing of taking down Mt. Mox with the currency recent sharp valuation rally  is not a coincidence, and is viewed as something to defend against.

To me, what Bitcoin has achieved is a historical milestone on the road to a new financial system model.  The Bitcoin system being used for years by a very small minority, now has achieved with validation that Bitcoin is a threat.   And a new currency system must survive the worst global assualt possible and survive to be considered 'good enough' for the world to trust.

I have written about bitcoins in the past, I do not believe it is a good currency replacement.  It is subject to shortages, and therefore prone to deflation.  I'll take inflation over deflation, and therefore I find deflation much more damaging.

In this article from rt.com 'Bitcoin Threatens economic monopoly, bolsters free speech' I think does a very good job of capturing the true power that a new financial model will set the world free, from a debt based society to a free one.

What I have not yet seen is an indepth critique of many core flaws in the bitcoin model I see, how those core flaws cannot be overcome and doom the currency to failure.

What do you think? Below is the techie in me experimenting with a service called Branch, to facilitate discussion via twitter.   I doubt I'll get any reader (if there is any left!) posting on this, but feel free to do so.  If I do get even a tiny amount of responses, I'll be encouraged to make it a staple on this blog.

Click on the red odd icon at the top to get started.








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