DGC – Page 4 – — Covering digital currencies, precious metals and online payments

Bitcoin Foundation Comments on Liberty Reserve Special Measures

Julia Dixon on July 21, 2013

After shutdown of Liberty Reserve in May this year FinCEN proposed an “Imposition of Special Measure Against Liberty Reserve S.A. as a Financial Institution of Primary Money Laundering Concern”. The primary purpose of the ‘Special Measure’ being to cut Liberty Reserve off from the banking system.

FinCEN noted Liberty Reserve’s irrevocable transactions and lack of ID verification as evidence that “Liberty Reserve’s system is structured so as to facilitate money laundering and other criminal activity,” these comments worried the digital currency community and was likely what scarred off many of their banking partners.

On the 19th, the Bitcoin Foundation responded to FinCEN’s proposed special measure urging them to clarify that not all virtual currency transactions are inherently suspect.

SatoshiDice sells for $11mil

Julia Dixon on July 21, 2013

In perhaps the first major acquisition of a Bitcoin company, the gambling site sold this week for 126,315BTC, or $11.47million.

The site was launched by Erik Voorhees in late April 2012 with shares being traded on MPEx, a Bitcoin securities exchange.

Voorhees announced the sale on Wednesday evening via Bitcointalk.

Dear Asset Holders,

I have some very important news to share with you. Some of you will be pleased, and some upset, but I believe this to be a solid, desirable, and fair outcome for those who have put their trust in S.DICE.

SatoshiDice is being sold, in full, to a new company that will take over all ownership, operations, and management. The total sale price is 126,315 BTC, or 0.00126315 BTC per share.

Inside the white hot Chinese gold market

Julia Dixon on July 18, 2013

Jan Skoyles and the Real Asset Company are continuing their look at the global gold market, this time with review of the Shanghai Gold Exchange.

Released last week the review covers contracts, deliveries, Inventory, pricing and SEG members.

In the next part of our on-going look at the global gold market we now turn our attention to the Shanghai Gold Exchange. An exchange which has received more interest of late, than any other in the world of gold and silver.

Previously we have looked at the global gold market, COMEX, and more recently the London Gold Market. The next logical focus of our investigations is the Shanghai Gold Exchange. We also have a great infographic providing you with the top figures.

Given the significant rise of gold exports from Hong Kong to China, 68% yoy, this is a timely and informative research piece which shines a spotlight on the Eastern gold market in a time when many are declaring the end of the gold bull market. Given the huge demand for physical and reportedly high premiums on the gold price, we ask if this market may well be a better indicator of gold demand, and subsequently true gold prices, than either COMEX or London.

Read the report here.

Using M-Pesa to bring Bitcoin to Africa

Julia Dixon on July 11, 2013

The M-Pesa mobile payment system is huge in one of Africa’s biggest economies, Kenya. An estimated 31% of Kenya’s GDP travels through the person to person payment provider. The country has a large rural population making traditional branch banking an unattractive option. This is certainly one of the reasons that M-Pesa’s SMS based mobile payment system has caught on. But what is clear from the M-Pesa story is that the worlds ‘under-banked’ need better solutions.

Could Bitcoin be a solution for Africa’s under-banked? It’s certainly a possibility and why not start in Kenya with a population who both has a need for and a familiarity with digital money.

Matonis: Why I Accepted Executive Director Position for Bitcoin Foundation

Julia Dixon on July 10, 2013

Via the Bitcoin Foundation Blog…

I am proud to have been associated with the Bitcoin Foundation since its launch just nine short months ago. A nonprofit organization for Bitcoin can add greatly to the political and economic discourse for cryptographic money and monetary freedom. As Executive Director, I welcome the new challenge.

The Foundation has never claimed to represent all of Bitcoin nor all of its users because that would be impossible for any organization. Rather, the Foundation has consistently attempted to fill the gap where market-based incentives may not have produced the same outcome, such as in the areas of specialized grants and compensation transparency for volunteer developers as well as legal challenges to bitcoin usage and the sponsorship of aggressive legal defense.

UK regulator will not require Bitcoin exchanges to register

Julia Dixon on July 9, 2013

CoinDesk is reporting that in a letter send to an exchange start up the UK, financial regulator HM Revenue & Customs (HMRC) has stated that the proposed exchange has no need to register under money laundering regulations. However the letter does make it clear that HMRC may change their mind and require registration in the future.

Via CoinDesk…

The letter from HMRC reads as follows:

“With reference to your enquiry at this time there is no requirement to register with HMRC under the Money Laundering regulations, however HMRC recognise that the issuing of Bitcoins represent an emerging development.

The Bitcoin Foundation has a new Executive Director

Julia Dixon on July 9, 2013

Jon Matonis has been appointed as the new director and will start immediately.

Via the Bitcoin Foundation blog…

As of today, Jon Matonis has accepted my offer to join us as Executive Director of the Bitcoin Foundation. He starts immediately, although he’ll take a few months to ramp up to full time.

A Bitcoin ETF?

Julia Dixon on July 4, 2013

On Monday the Winklevoss twins, Cameron and Tyler, filed paper work with the SEC for a Bitcoin ETF. The “The Winklevoss Bitcoin Trust” has filed for an initial public offering of 1 million shares at $20 each.

“The Winklevoss Bitcoin Trust (Trust) will issue Winklevoss Bitcoin Shares (Shares) which represent units of fractional undivided beneficial interest in and ownership of the Trust. Math-Based Asset Services LLC is the sponsor of the Trust (Sponsor) and [TRUSTEE] is the trustee and custodian of the Trust (Trustee) using proprietary and patent-pending technology to administer the Trust. The Trust intends to issue additional Shares on a continuous basis.”

While this is certainly a sign of Bitcoin continuing its move towards the mainstream, the filing has also drawn a lot of criticism. Critics include those who think Bitcoin is a silly idea in general, to those who are all too happy to list all the ways in which it could go wrong.

The EFT is still a long ways off of actually happening, and it will certainly be interesting to see how the SEC will handle the filling.

HuffingtonPost: The Crime of Alleviating Poverty – A Local Community Currency Battles the Central Bank of Kenya

Julia Dixon on July 3, 2013

Via the HuffingtonPost:

Complementary currencies can help eradicate poverty.

Proving that may be difficult in complex economies, due to the high number of factors influencing outcomes. But in an African slum with little of the national currency available, supplying residents with an alternative currency has a positive effect that is obvious, immediate and incontrovertible.

True peer-to-peer currency exchange?

Julia Dixon on July 2, 2013

One of the biggest problems currently facing the Bitcoin economy is the exchange market. The market suffers from continued concentration and price volatility. In order to maintain their links to the traditional banking world, these businesses have the unenviable task of attempting to shove Bitcoin into the world of bank accounts and anti-money laundering policies. New exchanges are joining the Bitcoin economy but regulatory compliance is no small barrier to entry. The few existing online exchange services continue to be significant points of failure for the Bitcoin economy.

A network of small, peer-to-peer transactions would likely bypass many of these issues and would be a fitting solution for the brilliantly decentralized Bitcoin network. But is such a thing possible? The guys behind MetaLair, a UK based start-up, think so and are working hard to develop the software and find the investors to make it a reality.