Monday, December 23, 2013

Bitcoin news - December 23 , 2013 -- Thousands of Hoarded Bitcoins Flood the Block Chain in Mystery Transaction ( caused by old time miners , large exchanges , long term early adherents , Silk Road or other blow us ? ) .... Singapore Regulators decline to interfere with Bitcoin.....News anchor learns valuable lesson about BitCoin security.....4 Million buck Icelandic BitCoin mining consortium....Silk Road Accused wants his BitCoin back from the Government .....

updates - 12/26.....

Indian Bitcoin Exchanges Suspend Operations Following RBI Warning

 | Published on December 26, 2013 at 17:00 GMT | AsiaExchangesNews,Regulation

Several Indian bitcoin exchanges have pulled the plug and halted trading following a statement issued by the Reserve Bank of India (RBI)on Tuesday.
The RBI warning advised consumers and investors to steer clear of bitcoin, citing numerous risks associated with digital currencies. The list of concerns outlined by the RBI was more or less standard – lack of regulation, security issues, rampant speculation and volatility. The RBI also pointed out that Indian bitcoin exchanges are operating without regulatory approval, which is hardly surprising given the fact that India does not have a regulatory framework that would encompass digital currencies.

Services suspended temporarily or indefinitely

Just two days later several bitcoin operators in India chose to play it safe. They suspended trading, either temporarily or indefinitely. Bitcoin trading platform INRBTC said it was suspending services indefinitely in light of RBI’s warning. It pointed out that RBI’s warning states parties involved in digital currency transactions could be subject to unintentional breaches of anti-money laundering legislation and counter-terrorism laws.
INRBTC said:
“The only option left now is suspend the services until further arrangements can be made,” INRBTC said, while adding that all trades which have been executed till December 26, 2013 will be processed completely.
All pending orders will be cancelled and the deposits on those orders will be refunded 100 per cent to the users.”
Another operator,, informed investors that it is suspending buy and sell operations until it can outline a clearer framework with which to work.
“This is being done to protect the interest of our customers and in no way is a reflection of bitcoin’s true potential or price,” said in a statement posted on its website.
The Hindu reports that many other bitcoin services in India have gone down. Some of their websites appear to be gone, too. However, other operators are carrying on and they are still offering rupee to bitcoin services.


In its statement of 24th December, the RBI said it is examining issues associated with digital currencies, namely trading, holding and use of digital currencies in India. However, the RBI is limited by existing legislation and since there is no indication that India will enact any new digital currency regulations, it is unclear what the RBI can do.
Essentially if the RBI chooses to apply India’s existing regulatory framework to bitcoin, that may entail the use of standard foreign exchange regulations. This might force bitcoin exchanges to start operating in much the same way as traditional currency exchanges, but there is a problem. The average bureau de change deals only in national currencies, backed by central banks, using spot prices derived from large interbank transactions. It would be extremely difficult to apply regulations crafted for traditional currency exchanges to digital currencies like bitcoin and it might even be impossible altogether.
The RBI is examining India’s payment system laws, too. It is obvious that it will face similar challenges if it tries to apply existing payment laws. The vast majority of international transactions are handled by banks and they rely on SWIFT standards. Legislation tends to reflect this fact and legislation in this heavily regulated industry is not what we would call flexible when it comes to international standards.

What next?

At this point it is hard to say whether Indian exchanges that have decided to suspend trading will find a way of getting back into the game. Furthermore it is unclear whether the exchanges that are still working will stay open. Although the RBI said it is looking into the matter, the fact that India does not have digital currency legislation remains a problem, especially if existing legislation is not practically applicable to digital currencies.
These events will undoubtedly create even more volatility and uncertainty, especially in light of China’s clampdown earlier this month. It remains to be seen whether the RBI and the Indian Ministry of Finance will push lawmakers to enact viable digital currency legislation.
As we reported earlier this month, India has a few region-specific concerns that it would like to address, namely e-ponzi schemes and multi-level marketing schemes involving bitcoin. Using unregulated digital currencies for such activities might make it extremely difficult to prosecute or even identify the culprits.
If plenty of people fall victim to such schemes, they might have quite a few questions for regulators and lawmakers, provided digital currencies remain unregulated. The potential political fallout of doing nothing might be embarrassing and too much to stomach for many lawmakers.

Bitcoin exchanges shut shop in India

December 24 , 2013......

BofAML Asks "Is This The End Of Bitcoin?"

Tyler Durden's picture

Following David Woo's initial $1300 fair-value price target for Bitcoin, the BofAML strategist has had to suffer through some significant changes; not the least of which is China's increasingly strict Bitcoin regulation. The shifts, he notes, raise key questions about the future of Bitcoin as he asks "is this the end of Bitcoin?"

Via BofAML's David Woo,
Although this has yet to be officially confirmed, there are reports that the People’s Bank of China (PBOC) has banned third-party Bitcoin payment companies from making renminbi deposits to Bitcoin exchanges. The news follows a move by PBOC two weeks ago preventing Chinese traditional financial institutions from handling Bitcoin transactions noting the risks Bitcoin posed because of its volatility, ease of use for money laundering, and risks that it can be used by criminal organizations.
What does this mean?
Two largest Bitcoin exchanges in China, BTC China and OkCoin have stated they cannot accept new yuan deposits, though current balances may still be exchanged for BTC or withdrawn. Bitcoin prices have fallen significantly on the back of the news and the CNY’s share of overall transactions has fallen from the high of 78% on 12/15 to 33% on 12/18 (see chart below).

The last time CNY's share of transactions was below 40% on two consecutive days (Nov 6-7), Bitcoin was trading at $313 in USD terms, below current prices of $670. The government appears to be looking to hamper Bitcoin speculation with this move effectively preventing new inflows to the Bitcoin ecosystem in China. New yuan-based investors will have no ability to purchase Bitcoins on the mainland.
The easiest way to understand this latest development is that China is adopting the same tougher regulatory stance as the US.This tough stance is the reason there are very few Bitcoin exchanges in the US. China’s relatively lax regulation, until recently, in this regard explains the strong growth of Bitcoin exchanges there. Unlike the US, Chinese exchanges are not required to gain regulatory approval as money services businesses (MSBs) prior to opening. In the US, with a few exceptions, all states require Bitcoin exchanges to obtain MSB approval. If the China story turns out to be correct, the success or failure of Bitcoin exchanges in their quest to acquire licenses as money transmitters in the US over the next 2-3 months becomes even more crucial.
Given China is now taking a tougher regulatory stance with regard to Bitcoin, the regulatory arbitrage between CNY and USD exchanges will likely be minimized. Indeed, the premium of BTCCNY premium has turned negative recently in response to these tougher regulations (see chart below). In the past, China was seen as an easier place to set up operations because of the lower regulatory thresholds.
Switzerland is another important country to watch in this regard. The Swiss federal government is currently writing a report assessing Bitcoin opportunities for the Swiss financial sector. Additionally, they are assessing if Bitcoin can be considered a legal foreign currency and regulated under their existing laws which would potentially provide a legal way forward for institutional Bitcoin investors.
Is this the end of Bitcoin?
These reports raise key questions about the future of Bitcoin. The outcome of Bitcoin exchanges currently applying for money services businesses licenses in the U.S over the next 2-3 months becomes even more important should the China news turn out to be correct.
There are three sources of uncertainty over the licensing process.
First, it is not clear whether the states will coordinate to set common requirements for granting licenses (this will take more time) or that they will act independently of each other.

Second, how onerous will the requirements on anti-money laundering provisions be? It is easy to see how this is a non-trivial challenge for the would-be exchanges. While it is likely that people setting up Bitcoin accounts will have to disclose their identity and transactions as a first step, it is unclear whether regulation would also require disclosure of transactions within their Bitcoin-denominated account.

In addition to uncertainty with regard to licensing, Bitcoin's tax treatment is also an important issue. The General Accounting Office has asked the IRS to draft regulation to clarify the taxation of Bitcoin transactions and capital gains.
Together these factors will likely mean that Bitcoin users make a small sacrifice by ceding some of the anonymity Bitcoin provides.However, we view such sacrifices as a necessary part of legitimizing Bitcoin within the regulatory framework and potentially paving the way for more wide-scale use.

Reserve Bank warns against Bitcoin use

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File photo shows bitcoin tokens. The Reserve Bank of India, on Tuesday, warned the public against the use of virtual currencies such as Bitcoin, pointing out that users expose themselves to potential financial, operational, legal and security related risks.
APFile photo shows bitcoin tokens. The Reserve Bank of India, on Tuesday, warned the public against the use of virtual currencies such as Bitcoin, pointing out that users expose themselves to potential financial, operational, legal and security related risks.

No regulatory nod has been obtained by any entities that carry out such activities

The Reserve Bank of India, on Tuesday, warned the public against the use of virtual currencies such as Bitcoin, pointing out that users expose themselves to potential financial, legal and security related risks.
The public advisory comes after the borderless digital currency has begun to gain widespread acceptance in India, despite poor Internet penetration and a natural scepticism to assets not backed by tangible entities such as land.
The central bank also said that it had been “examining the issues associated with the usage of virtual currencies” under the legal and regulatory framework of the country.
In its list of potential risks, the apex bank highlights problems such as losses arising out of hacking, no sources of customer recourse and the general financial volatility surrounding Bitcoins.
“The creation, trading or usage of virtual currencies including Bitcoins are not authorised by any central bank or monetary authority. As such, there is no established framework for recourse to customer problems,” the RBI said in a statement.
“It has also been reported that Bitcoins are being traded on exchange platforms, whose legal status is also unclear. Hence, the traders of virtual currencies are exposed to legal as well as financial risks,” it added.
Gaining currency

Bitcoins, and other virtual currencies, have been gaining currency quickly in India. According to SourceForge, an online platform that connects consumers to open-source projects such as Bitcoin and facilitates client downloads, there have been 35,648 downloads in India since the launch of Bitcoin on November 9, 2008.
A number of India-based trading platforms and exchanges have sprung up over the last six months, catering to Indian users by allowing them to purchase Bitcoin in rupees. The RBI, however, has pointed out that no regulatory approval has been obtained by any entities that carry out such activities.
“There have been several media reports on the usage of Bitcoins for illicit and illegal activities. The absence of information of counterparties could subject users to unintentional breaches of anti-money laundering,” the central bank said.
The mainstream Bitcoin community in India has welcomed the RBI’s shift from its earlier ‘wait-and-watch’ policy, and believes that specific regulation may be in the offing.
“Of course, it is good that the RBI has shifted from not saying anything to warning people of the risks involved. Yes, trading platforms in India do not have approval, as there is no regulation in the first place! We believe this advisory notice may be a precursor to some regulation,” said Satvik V, Founder, CoinMonk Ventures, who organised India’s first Bitcoin conference earlier this month.

Canadian Provincial Bitcoin Law: It’s All About Protecting the Consumer

 | Published on December 24, 2013 at 10:00 GMT | NewsRegulationUS & Canada

My name is Matt Burgoyne and I’m an associate at Canadian legal firm McLeod Law. I’m involved with Canadian and international counsel in the developing area of virtual currency law, specifically including bitcoin currency. In this two-part series, I will give a basic primer on the state of Canadian law as it applies to digital currency entrepreneurs.
In the first article I published on Canadian bitcoin law we discussed legislation as it applies at the federal level, where I made the comment that it is at the federal level where most of the ‘action’ lies in respect to Canadian law as it pertains to bitcoin businesses.
This is because in Canada, pursuant to our constitution, currency and coinage, legal tender and other financial activities like banking fall under the exclusive domain of the federal government, and I referred to the piece of legislation that would likely take precedence in bitcoin transactions, the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (the “PCTFA”).
FINTRAC is the ‘watchdog’ if you will, enforcing the PCTFA. As a result, most bitcoin businesses operating in Canada would first and foremost want to be sure their activities are compliant with the PCTFA and FINTRAC.
FINTRAC (like FINCEN in the United States) has the power to compel companies to comply with the PCTFA, in some cases in rather costly ways.
In this article on Canadian bitcoin law, I will cover provincial legislation and accompanying regulations pertaining to companies operating in the bitcoin space.

No money transmittal laws

Unlike the legal framework of regulation in the United States, on a province by province level in Canada, bitcoin businesses should not be concerned about licensing requirements as they pertain to money transmitting, since those activities, if and when the federal government so chooses, would likely be governed under the PCTFA.

Consumer protection laws

What provincial laws would a bitcoin business have to be cognizant about when conducting operations in Canada?
A bulk of the laws relate to how and under what circumstances a bitcoin company can interact with the public (i.e. consumer protection legislation). It is important to note that, with some exceptions, the application of consumer protection legislation in each province is for the supply of goods and services for personal, family and household purposes, not for business purposes.
Some provinces have separate legislation, as discussed below, that deal with unfair business practices. Some provinces have a single ‘hybrid’ law that covers both consumer protection and protection against unfair business practices.
Bitcoin entities operating in Canada need to be aware of how consumer protection legislation and legislation protecting against unfair business practices can affect their businesses.
There are 13 provinces and territories in Canada. For the purposes of this article, I will focus on two of the 13 which are a fair reflection of the provincial laws of other jurisdictions in Canada.
I will focus on Ontario as an example of one province which has consumer protection laws but no ‘business dealing’ protection laws (Ontario has other laws which deal with business dealings and businesses in general and it is beyond the scope of this article to delve into that legislation), and British Columbia as an example of a province which has a hybrid consumer and business protection law which could apply to bitcoin businesses.


consumer protection
Consumer protection image via Shutterstock

Make no mistake, the Ontario Consumer Protection Act and its single Regulation (together, the “Ontario Act”) are both lengthy documents and the following summary is meant to be very general at best.
Often the best way to deal with a specific issue is, if your bitcoin business is selling consumer goods to an end user in Ontario (or any other province in Canada for that matter), contact a lawyer in Ontario who is familiar with the Ontario Act and who can pinpoint what section of the Act may apply to your specific issue.
At the outset, it’s important to note that the Ontario Act specifically does not apply to financial services related to investment products, income securities or consumer transactions that involve financial products or services regulated under other more ‘business’ friendly Ontario Acts such as the Securities Act and the Insurance Act.
As you will see, the legislation in Ontario is fairly heavily weighted in favour of the consumer. Bitcoin businesses offering consumer products to purchasers in Ontario should keep this in mind.

Cooling off period

In Ontario, consumers may be entitled to a cooling off period. Let’s say a consumer makes a purchase or signs an agreement in her home via the internet to purchase some bitcoin mining hardware for her own personal use and then decides to change her mind.
If the deal is worth more than $50, she has the right to cancel within 7 days in respect to an internet purchase and 10 days for a purchase made through other means and could get her money back. The legislation permits cancellation by registered mail.
When a consumer takes advantage of her 7 or 10 day cooling off period and notifies the business (preferably in writing) that she has changed her mind, the company has 15 days to return the purchaser’s money. The business has the right to take back the goods provided under the agreement by either picking them up or paying for the cost of sending them back.

Unsolicited goods

If a consumer is sent unsolicited goods they didn’t ask for, the consumer doesn’t have to accept or pay for them. In fact, a consumer may use them or throw them out.

Pre-paid goods or future service oriented agreements

Pre-paid goods or future performance agreements over $50 must have a written agreement. When some part of the agreement occurs in the future, (e.g. a bitcoin organization membership or a pre-paid bitcoin gift card) and the goods or services are worth more than $50, a written agreement is required. The agreement must contain complete details of the transaction and full disclosure of any credit terms.
All agreements must be clear and understandable. Vague language is discouraged in agreements. All required information must be clear, prominent and easy to understand. If there is a dispute over unclear language, the Ontario Act requires that it be interpreted in favour of the consumer.
So if you are a bitcoin entity trying to sell a consumer good it would be prudent to ensure your lawyer drafts up an agreement that cannot allow for more than one reasonable interpretation; there can be no room for ambiguity.

Consumer assistance rights

Some bitcoin businesses, like other businesses, add arbitration clauses to their agreements that require users to use a private arbitration process to resolve complaints instead of going to court or seeking assistance from the consumer services division of a provincial government.
In Ontario, consumers are not legally bound by these clauses, even if the consumer has accepted the agreement. Bitcoin businesses conducting any consumer related activity in Ontario must have competent legal advice ahead of time, prior to the time that contracts are drafted and executed.

Misrepresentation is illegal

All charges in an agreement must be what they say they are. For example, a bitcoin business may not add a $20 surcharge for a “tax” that is not really for tax. Consumers are advised to understand what each charge is for and that it’s valid and bitcoin vendors need to understand this at the outset.

Consumer agreements require extensive detail

If a consumer has entered into an agreement in which a cooling off period applies and he discovers that the bitcoin business failed to disclose something they were required to by law, the consumer has the right to cancel the agreement within one year.

Timely delivery of product

Deliveries must be on time. For example, a supplier of bitcoin mining equipment must deliver within 30 days from the promised date. After that, a consumer can cancel the contract by sending a cancellation letter; however the consumer loses the right to cancel the agreement if he accepts delivery after the 30 day period has elapsed.
Individuals who violate certain sections of the Ontario Act are liable to a fine of up to $50,000 or imprisonment of up to two years less one day or both. A corporation can be fined up to $250,000.

British Columbia

judge's hammer
Judge’s hammer image via Shutterstock

As with the Ontario Act, the British Columbia Business Practices and Consumer Protection Act and its associated 10 regulations (together, the “BC Act”) is a very lengthy piece of legislation and it is the intent of the writer to deal with the BC Act in a very general way.
Readers are advised to consult a lawyer for specific advice if they are a bitcoin business selling goods to consumers or businesses in British Columbia and have a specific issue they are unsure about.
The BC Act applies to all consumer transactions. “Consumer transactions” means a supply of goods or services by a supplier to a consumer for purposes that are primarily personal, family or household, or a solicitation, offer, advertisement or promotion by a supplier with respect to a transaction previously referred to.
“Consumer transaction” can also mean a solicitation of a consumer by a supplier for a contribution of money or other property by the consumer.
Interestingly, and this is what sets the BC Act apart, makes it a ‘hybrid act’ if you will, and differs it from some other provincial acts that simply protect the interests of consumers in consumer transactions, are the sections in the BC Act on credit reporting and debt collection apply to all transactions (not just ones involving consumers but also to unfair business dealings).
However, after my review of the BC Act I can’t see how these ‘business dealing’ sections would apply to bitcoin businesses since bitcoin entities are not (at least not at the time of the writing of this article) in the business of credit reporting or debt collection.

Standard (direct) sales contract information

Under the British Columbia Act, any sales contract entered into between a supplier and a consumer for the supply of goods or services that is entered into in person at a place other than the supplier’s permanent place of business (a “Direct Sales Contract”) must contain very specific information, including but not limited to the following:
(a) the supplier’s name;
(b) business address, telephone number and the date on which the contract is entered into;
(c) a detailed description of the goods or services to be supplied under the contract and an itemized purchase price list for the goods or services being acquired;
(e) the total price under the contract, including the total cost of credit and terms of payment; and
(e) a notice of the consumer’s rights of cancellation, in the prescribed form and manner, if any.

Internet (distance) sales contract information

In the event a bitcoin business that is not physically located in British Columbia is selling goods to consumers in British Columbia via the internet (a “Distance Sales Contract”), the Distance Sales Contract, in addition to the information above, must contain extra information, including but not limited to the following:
(a) the supplier’s email address;
(b) a description of any relevant technical or system specifications;
(c) the currency in which amounts owing under the contract are payable;
(d) the supplier’s delivery arrangements; and
(e) the supplier’s cancellation, return, exchange and refund policies.
A supplier must give a consumer who enters into a Distance Sales Contract a copy of the contract within 15 days after the contract is entered into.

Cooling off period/right of cancellation

Similar to the Ontario Act, a consumer is entitled to cancel a Direct Sales Contract within 10 days of the date the consumer receives a copy of the contract, by giving notice to the supplier in writing via registered mail, delivery in person or delivery via email.
In the case of a Distance Sales Contract, the cancellation period is 7 days (same notice provisions apply as in a Direct Sales Contract).
A consumer can cancel a Distance Sales Contract within 30 days after the contract is entered into if the supplier does not provide the consumer with a copy of the contract listing the above disclosure requirements or if the product is not delivered within the 30 day period from the date the Distance Sales Contract was entered into.

Unfair and deceptive acts or practices

The British Columbia Act broadly defines a ‘deceptive act or practice’ to mean any conduct by a supplier that has the ultimate effect of deceiving or misleading a consumer.
“Representation” includes any term written on any website or promotional item.
This is not an exhaustive list, however any one or more of the following can constitute a deceptive act or practice under the British Columbia Act:
(a) a representation by a supplier that a particular product has sponsorship, approval, performance characteristics or uses or benefits that they do not have;
(b) a representation that a particular good is of a particular standard, quality, grade, style or model if it is not;
(c) a description by a supplier of a product that uses exaggeration, innuendo or ambiguity about a material fact or that fails to state a material fact, if the effect is misleading.
If it is alleged that a bitcoin company selling pre-paid gift cards loaded with bitcoin committed or engaged in a deceptive act or practice, the burden of proof that the deceptive act or practice was not committed would be on the bitcoin company.
An individual who commits an offence under the British Columbia Act is liable to a fine of not more than $10 000 or to imprisonment for not more than 12 months or to both.
A corporation who commits an offence under the British Columbia Act is liable to a fine of not more than $100 000.

Final thoughts

In this article I focused on consumer protection acts in two sample provinces because I believe that bitcoin businesses operating in a specific province or territory in Canada are going to be most concerned with consumer protection legislation; that type of legislation is the most relevant and in my opinion the most important for bitcoin businesses operating in Canada.
That being said, there are a number of other provincial acts which could apply (not only to bitcoin businesses but to any business), in a more generic ‘no brainer’ sense:
- Employment Standards Codes;
- Business Corporations Acts;
- Personal Property Security Acts; and
- Privacy Acts.
So far I have covered Canadian Federal law as it may (or may not) apply to bitcoin businesses, discussed Canadian provincial law as it applies to bitcoin businesses and pondered the question of how the Canadian federal government views bitcoin, either as a barter good or as a currency (it’s the former).
Expect my next article to focus on the Canadian banking industry and how it views bitcoin businesses, since that has been a major issue for my clients and others operating in the Canadian bitcoin landscape.

Thousands of Hoarded Bitcoins Flood the Block Chain in Mystery Transaction

 (@southtopia) | Published on December 23, 2013 at 11:00 GMT | CompaniesNews,Wallets

The bitcoin block chain threw out an interesting statistic yesterday: there were 134,084,960 ‘Bitcoin Days Destroyed’.
It’s the highest number in bitcoin’s history so far, beating the previous four record spikes which reached around 52,000,000 Bitcoin Days Destroyed respectively.
The chart below emphasises how dramatic that looks. If you filter this data for coins that are at least one year old, it still looks like this (130,990,276).
This means that a lot of older bitcoins moved yesterday – a lot. Who could it be this time? Again, fingers were pointed at the typical large-volume bitcoin holders: old-time miners, large exchanges, the Winklevii, or “something to do with Silk Road”.
The reality is, we can’t know for sure unless there’s some other hint.
It’s important to note that this figure does not mean 130m bitcoins changed hands. One “Bitcoin Day” is added to every coin for every day it doesn’t move to another address.
1 BTC, unmoved for a year, will have a score of 365 Bitcoin Days. Spend it, and that 365 score will be wiped, or ‘destroyed’.

Chart: Number of ‘Bitcoin Days Destroyed’ in 2013. Source:

Bitcoin itself has existed for 4.9 years. A single coin from one of the first blocks, unspent, would have a score of around 1,788 Bitcoin Days.
The fairly obscure and tricky-to-grasp “Bitcoin Days Destroyed” metric is essentially one way to tell how much ‘actual’ activity is happening in the bitcoin economy.
The longer a bitcoin sits around without being used, the number of ‘days’ it accumulates: 1 coin + 1 day = 1 Bitcoin Day. When the coin is sent somewhere, that accumulated total is said to be ‘destroyed’.
This reddit discussion offers some useful insights on the subject.

Hoarder metrics

For another example: 5 BTC held for one day then spent is 5 days destroyed. That same 5 BTC held for a week (7 days) then spent is 5 x 7 = 35 days destroyed.
If you held them for a whole year, they would have accumulated 1,825 Bitcoin Days. Spend them after that long, and … bingo! 1,825 Bitcoin Days destroyed (or the accumulated number is ‘reset’).
A low number of days destroyed means more bitcoins are being hoarded. A high number – especially one as high as 130 million – means a lot of coins just got un-hoarded.
It may not have been 130 million, but that figure divided by even 3 years of Bitcoin Days equals over 118,000 BTC – quite a lot to move all at once.

In the long-term

To measure activity we could simply count the number of transactions, but that tells us nothing about the amount of bitcoins being kept in long-term storage, or bitcoins lost forever due to lost keys, hardware, and other regretful blunders. Seeing old coins come back into circulation is good news, as it means they’re not lost.
Counting simple transactions could also allow an individual or small group to manipulate the statistics by moving the same coins round and round.
But back to yesterday’s statistic: who was it?
The answer is, we can only speculate. It’s probably not from the oldest blocks, which haven’t moved at all. It’s also important to remember that, just because bitcoins have changed addresses, it doesn’t mean that they changed hands, or were exchanged for anything.

Singapore Regulators: We Will Not Interfere With Bitcoin

 | Published on December 23, 2013 at 13:00 GMT | AsiaExchangesNews

At a time when many central banks and regulators are issuing bitcoin warnings and taking steps to limit bitcoin-related trades, Singapore’s central bank has decided to steer clear of bitcoin, for now at least.
The Monetary Authority of Singapore(MAS) told Singapore-based trading platform Coin Republic that it will not interfere with bitcoin adoption. The authority said: “Whether or not businesses accept bitcoins in exchange for their goods and services is a commercial decision in which MAS does not intervene.”
According to TechInAsia, the statement isn’t surprising, as the government has already made it clear that MAS should not regulate virtual currencies like bitcoin. However, the Authority has issued statements on the currency in the past, warning speculators that trading bitcoin was risky back in September.
The latest announcement is in no way an endorsement of bitcoin, but it will go a long way to reassure investors who use Singapore-based bitcoin services like Coin Republic.

Bitcoin’s advocates

Coin Republic was founded by David Moskowitz, a zealous advocate of bitcoin who believes the Bitcoin protocol could be employed to make remittances cheaper and to cut costs in various industries.
Moskowitz likes to point out that a number of countries prefer to keep bitcoin open and unregulated, namely Japan and Germany. Singapore appears to be just as open when it comes to bitcoin.
Singapore is a major regional financial services hub and its relaxed attitude towards bitcoin has attracted several bitcoin entrepreneurs and investors. These include GoCoin’s Steve Beauregard, who decided to set up shop in Singapore in April 2013.

Attractions of Singapore

There are a few other factors that make Singapore an attractive location for bitcoin companies. In addition to its burgeoning financial sector, Singapore also has a thriving tech industry, so there is no shortage of skilled IT professionals.
Lastly, the city state has plenty of wealthy expats, along with thousands of migrant workers from neighbouring countries. Moskowitz hopes at least some of them will embrace bitcoin as an alternative to traditional wire transfers for remittances, saving a sizeable amount of money in the process.
Singapore has a reputation for being business-friendly and it simply wants to keep it that way.

Inside a $4 million Icelandic bitcoin-mining consortium

In Dealbook, Nathaniel Popper takes a look at a bitcoin-mining business called Cloud Hashing, that's moved its computers to Iceland in search of easy cooling and cheap, renewable power. The current set up requires over 100 computers, designed specifically for cracking the obscure algorithms that unlock new packets of bitcoin, and all cooled by direct blasts of arctic air. Cloud Hashing currently serves mining contracts for 4,500 customers, keeping 20 percent of its capacity open for its own mining. According to the outfit's account, it's mined more than $4 million of the cryptocurrency.
The project was started by British HSBC programmer Emmanuel Abiodun, who set up the Icelandic rig in February with the help of some angel investors. He's already raised $4 million to expand to additional storage in Texas. Still, Abiodun is in a potentially tricky place as the currency's value plummets. Since his millions in machinery are only useful for mining bitcoin, a crash would render the entire setup useless.

News anchor receives Bitcoin on TV only to have it promptly stolen

bloomberg btc gift
Theft has been rampant in the Bitcoin community ever since the virtual currency was launched in 2009. That's why it's important to understand how it works before you try to use it.
Bloomberg TV host Matt Miller gave two anchors $20 worth of Bitcoin each using a paper certificate with a QR code made by the company Lazzerbee. Unfortunately, Miller flashed one of the private keys at the camera, unaware that he'd opened the account up to theft. It wasn't long before someone collected the Bitcoin.
A Reddit user named "milkywaymasta" claimed credit for the digital mugging, bragging that it was "exhilarating." He or she promised to transfer the funds back as soon as the owner created a new address for which the keys haven't been broadcast on daytime television.
"A segment on Bitcoin security and the importance of NOT showing the private key and also BIP0038 (Password Encrypted Private Keys) Wallets will be more than enough compensation," milkywaymasta wrote.

NEW YORK (AP) - An Internet entrepreneur accused of being behind an online marketplace for illegal drugs has asked the government to return more than $30 million in bitcoin seized from his computers.

Ross Ulbricht, of San Francisco, was arrested in October following a crackdown on the black market website Silk Road.

Federal prosecutors in New York say Ulbricht went by the online handle the Dread Pirate Roberts and turned the underground site into a place where anonymous users could buy or sell contraband and illegal services.
In court filings, prosecutors say they seized 144,336 bitcoins from Ulbricht's computers.

Though subject to fluctuations in value, the virtual currency is exceedingly valuable, but lightly regulated.

Ulbricht says in a legal filing that the currency should be returned because it isn't subject to civil forfeiture rules.

( Tor is not secure..... word to the wise ! ) 

Silk Road 2.0 busted! At least two arrests as federal crackdown begins

End of the Road in sight?

If drugs traffickers thought the anonymous online black market calling itself Silk Road 2.0 would be any safer from law enforcement than the original, it looks like they had better think again.
According to reports by Forbes and TechCrunch, the FBI have made "multiple arrests" of people believed to be involved with Silk Road 2.0 in a crackdown spanning at least two countries.

Silk Road 2.0 forum moderators going by the handles "Inigo" and "Libertas" were reportedly arrested in Virginia and Wicklow, Ireland, respectively.
A woman identified as the girlfriend of Inigo reportedly said that police told her that they were making simultaneous arrests of the site's users "all around the world."
The FBI has since confirmed toForbes that it had moved against the encrypted marketplace, but it did not disclose the names of any of the people cuffed, or how many arrests had been made in all.
US authorities shut down the original Silk Road in October following the arrest of San Francisco man Ross Ulbricht, who is now awaiting trial in New York on charges that he created the site and profited from it for nearly three years.
In the process, authorities seized several Bitcoin wallets that they claimed belonged to operators and users of the site – a haul of illicit funds worth around $30m.
It wasn't clear at the time how law enforcement managed to achieve this since Silk Road routes its network traffic through the Tor service, which is supposed to make it easy for users to cover their tracks and work anonymously.
But in a post to the user forums of Tor Market – a competing site to Silk Road 2.0 – a user who is believed to be Inigo suggested that authorities may have a far better view into the workings of the online marketplace than anyone previously suspected:
Guys I was arrested yesterday and out on bond now. But something is fucked! I know I'm risking more warning you guys and my attorney doesn't even want me on the internet but you guys need to know this. When I was in the interview they showed me all sorts of shit that they should not know or have access to ... Something is definitely wrong and they have the ability to see things on here only mods or admins should like transfers and a dispute I had.
Prosecutors are still sifting through information gleaned from the original Silk Road bust to bring further cases against alleged drug traffickers, including four accused methamphetamine dealers who were charged in Oregon this week.
But many former Silk Road users seem undeterred by the recent police attention. A group of them wasted no time in launching Silk Road 2.0 following Ulbricht's arrest, complete with a new site admin taking on Ulbricht's alleged former moniker of "the Dread Pirate Roberts," or "DPR" for short.
The identity of this new DPR is still unknown. But on Friday he issued a statement to Silk Road 2.0 users saying the site had not been compromised by the recent arrests, since neither of the forum moderators that were charged had access to sensitive material. He further said he would make another announcement to address users' concerns soon. ®