Zero Hedge.....
As The Bitcoin Bubble Bursts, Digital Currencies Have A Dilution Problem
There was a time when people followed every gyration of bitcoin with pathological curiosity, peaking roughly five months ago when after having generated an epic return for 2013 as more and more momentum chasers got on board, the digital currency flirted with the $1000 (in USD terms) level on a daily basis. Then it peaked, almost to the day when this article came out, and ever since then it has been a slow, painful grind lower both for its holders and for its proponents, as can be seen on the chart below.
Needless to say, now that the bitcoin bubble popped, both the interest, and the momentum has been lost, as has the desire to "mine" bitcoin, which as weprofiled previously, requires massive, expensive computer workstations. Or rather required. Because as Bloomberg reports, the Bitcoin mining bubble has also burst.
Speculators, known as miners, use powerful computers to solve complex software problems and verify transactions to unlock new bitcoins. They’re finding that the enterprise isn’t as profitable as it once was.Drawn by the virtual currency’s jump in value last year, digital prospectors have turned the mining industry into an arms race as they buy expensive computing equipment and gobble up electricity. While that worked well as long as bitcoin’s value kept rising, smaller players are now being crowded out by bigger competition, high utility bills and declining prices.If you mine at the moment, you have to be very lucky to get anything,” said Mehmet Vatansever, who bought $16,000 worth of mining computers in February to chase after new bitcoins. “It’s a very difficult business.”
End result: Ebay is suddenly flooded with supercomputers whose only purpose was to create more bitcoins, and whose upkeep now that the price of bitcoin has tumbled, costs more than the profit from selling mined bitcoins.
While he has been able to create new bitcoins, Vatansever soon discovered that his equipment was on track to earn less than his monthly utility bill of $480. After selling his computers on EBay Inc. in April, Vatansever estimates that he lost a total of about $6,000 on his mining adventure.In the past week, miners made $14.9 million in revenue, compared with a weekly average of $25.2 million in December, according to Blockchain.info, an bitcoin-data aggregator. The figures represent the number of bitcoins mined plus transaction fees, multiplied by the dollar-based market price.EBay now features more than1,600 listings for mining computers, many of them used.
To be sure, while smaller operators have thrown in the flag, mining is still profitable for the scale operators who are crowding out minor players.
While individuals give up prospecting, at least two other larger mining companies, KnCMiner and Cloud Hashing, are still generating profits. By scaling up operations, they’ve been able to save costs on cooling and power, making their computers more efficient and cost-effective. KnCMiner also sells mining computers to other miners.KnCMiner, based in Stockholm, operates about 7,000 machines. While the mining company’s electric bill in March came to $450,000, the computers mined 21,000 bitcoins, according to co-founder Sam Cole.
However, the biggest losers are not the miners, especially if they can take the accelerated tax depreciation write off on their supercomputers (unless these can somehow be converted into HFT trading machines), but the sellers of these same machines.
Mining-equipment suppliers are feeling the cool-down firsthand. CoinTerra Inc., a manufacturer of the powerful computers used to crunch numbers for new bitcoins, has seen new sales shrink by 30 percent in the past three weeks from the preceding period, according to CEO Ravi Iyengar.Mining-equipment suppliers are also detecting early signs of a shift to new virtual currencies. Approximately 250 KnCMiner customers switched their orders from $10,000 computers to similarly priced alternative-currency mining machines in the past three weeks, according to Cole.
And there is of course NVidia, whose video cards experienced a dramatic surge in popularity as a cheaper alternative to self contained workstations, only to feel the sudden pullback in demand now (and if it hasn't yet, it will soon).
But the biggest irony is the following:
Because they are newer, designed differently and currently mined by fewer people, currencies such as Litecoin can be more profitable, according to CoinWarz, which tracks mining activity. “The new rush right now is Litecoin,” Colin Lusk, a network engineer in Portland, Oregon, said in an interview.While he once mined only bitcoins, Lusk now uses five of his eight machines to produce Litecoins and other virtual currencies. Created in 2011, Litecoin is similar in design to bitcoin yet requires less computing power. A $3,500 computer can produce $25 worth of Litecoins a day for $3 in electricity, while producing $20 worth of bitcoins would cost $17, Lusk said.
Spot the irony yet? As the bitcoin bubble bursts, the residual price momentum and "mining" bubbles remain only in those currencies where the "mining" of bitcoin is easier. This explains the shift from bitcoin to litecoin. In other words, where it is easier to create digital currencies out of thin air and where there is still a momentum-based surge in popularity. In yet other words - to permit a faster dilution of the existing currency pool.
But what is it that those who oppose fiar rage against? Why the eagerness and desire of central bankers to dilute said fiat at the first deflationary whim in order to protect their banking "custodians."
Who would have though that the digital currency crew would so promptly fall for the same "dangling carrot" incentives that all the fiat proponents are so tempted by on a daily basis...
Then again, monetary alchemy is nothing new - after all people were trying to convert lead into gold centuries before the US Dollar was the reserve currency. Luckily, they failed.
and....
Coin Desk ....
Chinese Bitcoin Exchanges Prepare to Move Operations Overseas
Published on April 11, 2014 at 21:41 BST | Asia, Exchanges, News,Regulation
Major China-based bitcoin exchanges Huobi and OKCoin are reporting that they have received word from banking partners indicating that certain deposit services would be terminated by 14th April.
The news follows the 10th April statements issued by BTCTrade, BTC100 and Huobi confirming that they had bank accounts terminated by financial partners. OKCoin was previously contacted by a third-party payment processor, which prompted it to stop servicing deposits via prepaid voucher with this partner on 2nd April.
While the two new announcements brought news of more account freezes, they were perhaps most notable as they illustrated that major China-based exchanges are already looking to put in place contingency plans to maintain operations should the PBOC decide to further restrict its state-backed financial service providers from interacting with the industry.
Huobi indicated in its post that it is “actively developing business cooperations with onshore financial institutions”, and that it has “reached agreements with many institutions to ensure that Huobi can have normal RMB deposits and withdrawals”.
The exchange also implied it is open to continuing operations outside China, stating:
Similarly, OKCoin offered a two-point restructuring plan in its post that included the potential for opening an overseas website designed to provide a “more stable, more secure trading platform”, which it suggested is currently under construction.
The announcements provide the latest evidence that the original rumours of enhanced restrictions first reported by Caixin on 27th March will come to pass.
No official documentation received
Though the exchange received new notices, neither provided any hard evidence as to the change in PBOC policy.
Huobi’s statement notes:
Its statement continued, explaining why information from major China-based exchanges has not been consistent in recent weeks.
More details
OKCoin released its statement on 6:00 GMT confirming that it had received oral notice from China Merchants Bank that its deposit services would be terminated.
Huobi’s statement followed shortly thereafter at 9:00 GMT, and stated that China Merchants Bank had requested to terminate the exchanges withdrawal servicesby 14th April.
Said Huobi in an online post:
OKCoin said withdrawals were not affected either, and that its other bank accounts were still active. In addition, it offered a plan for how it will continue operations, using a recharge code, or voucher, service for deposits and withdrawals.
Users would be able to use the recharge service to withdraw yuan, before transferring the code. There is no fee for withdrawals or deposits to code. These codes can then be traded among exchange users.
The exchange also continued its optimistic outlook, stating:
Huobi issues warning to PBOC
Of the two responses, Huobi’s was perhaps the best at putting the events in general context, stating that it believes the PBOC is tightening restrictions due to concerns about money laundering and the security of its domestic financial system.
The statement suggested that the PBOC should be careful not to force its exchanges to close down or relocate abroad, arguing that exchanges would be the easiest points in the system to regulate.
Read the statement:
The news follows the 11th April statements made by PBOC governor Zhou Xiaochuan, who said that the central bank will not ban bitcoin despite its latest policy shift.
Cyprus Issues Arrest Warrant for Neo & Bee CEO Danny Brewster
Danny Brewster, founder and CEO of Cyprus-based bitcoin depositary institution Neo and payment service Bee (known collectively as Neo & Bee), is now wanted by domestic law enforcement officials.
The Cyprus Mail reported that an arrest warrent has been issued for Brewster, who earlier this month was reportedly accused of defrauding customers.
The embattled CEO has been named as a “person of interest” in an investigation of the troubled Cyprus-based bitcoin savings and payment network, and three formal fraud charges have been filed against Brewster, law enforcement sources told the media outlet.
Police may also issue a European warrant for Brewster’s arrest.
Trouble grows for Neo & Bee
Neo & Bee is at the center of a growing controversy after its CEO abruptly departed the country earlier this month, reportedly seeking investment to keep the company afloat. Brewster, however, indicated that he would not return following allegations that threats were targeted at his daughter.
The statements by Brewster followed allegations from two customers that they paid €15,000 and €20,000, respectively, for bitcoins they never received.
Problems for Neo & Bee first began when questions regarding the company’s solvency were first raised earlier this month.
Neo & Bee’s future uncertain
Neo & Bee first opened to a good deal of enthusiasm in the community, with some commentators hailing the opening of the bank-like company as a step forward for popular acceptance of digital currencies.
These problems worsened when tradeable shares for LMB Holdings, the company that owns Neo & Bee, plunged in value on the Havelock Investment exchange.
Brewster, whose exact location is unknown, has said in the past that he plans to sell his equity in the company. It remains unclear whether or not the arrest warrant will change the calculus of any sale of his stake.
Crypto - Coin news....
Bitcoin Markets Rise On News Of Chinese Bitcoin
Exchanges’ Response Plan To Bank Accounts
Closing
Today at 10:35 local time, OKCoin posted an announcement to their website. The announcement was titled, OKCoin将暂停招商银行卡充值业务及应对预案公告: OKCoin Announces Suspension Of China Merchant Bank Card Recharge And Response Plan. OKCoin revealed that they received oral notification from their bank, the China Merchants Bank, that their deposit services were to be terminated. The Xi’erqi branch of the China Merchants Bank, which had a strong working relationship with OKCoin, revealed that the notification was passed down from upper management within the bank, much like what happened with the Agricultural Bank of China and the Industrial and Commercial Bank of China. Interestingly enough, this is also the latest move out of the National Australia Bank.
In response to this news, just another glancing blow in an onslaught of bad news out of China, the Bitcoin markets took an unexpected upturn. Bitcoiners have observed that this upturn in the market was largely led by Huobi, though all Bitcoin exchanges followed suit. Obviously, news of Chinese Bitcoin Exchanges closing Bank card recharges is already priced in seeing as how several similar announcements have been made in the last few weeks. The “new news” is OKCoin’s Response Plan.
BTC-e showing a rise from a 5 month Bitcoin Exchange Rate low.
Yesterday morning in China, BtcTrade and Huobi were informed by their respective banks of a similar end to their business accounts. The respective city and county branches of the Agricultural Bank of China and the Industrial and Commercial Bank of China both informed their Bitcoin business partners that they had to suspend bank card recharges in the next week. Weeks ago, on 4/3/14, several Chinese Bitcoin Exchanges, including OKCoin, announced the end of yuan deposits via 3rd party payment processors. Before that, Bter was the first to receive a notice directly referencing the PBOC notice that nobody from the Bitcoin community has yet, or may ever, see. On 3/27/14, Chinese reporters from Caixin claimed to have seen the PBOC document and published a synopsis of its contents. The title of the supposed notice is this: 关于进一步加强比特币风险防范工作的通知, or the Notice on Further Strengthening Bitcoin Risk Prevention Measures. In the notice, the PBOC called for strict adherence to its 12/05/13 statement, informing these entities that they needed to halt all business with Bitcoin related companies and sites by 4/15/14.
Response Plan
OKCoin presented a 2 point response plan to the closing of their bank account by China Merchants Bank.
1. A New Yuan Recharge method using codes2. An overseas website
I believe that OKCoin is using a new yuan deposit method similar to the one being used by BTC China at the moment, which BTC China created shortly after the original PBOC notice back in December 2013. Furthermore, they are planning to open an overseas website. OKCoin was intentionally vague about whether this overseas website would be inside China facing out, or outside China facing in. BtcTrade, in the same vein, revealed their response plan yesterday as well. BtcTrade has already registered their company in Hong Kong, Japan, and the USA and are also planning to open an “overseas website.” They will also start USD trading, and you really shouldn’t be surprised if more Chinese Bitcoin Exchanges start announcing this move. Just like you shouldn’t have been surprised when BTC-e announced Chinese Yuan trading.
No matter what the banks are doing, anywhere in the world, Bitcoin services (exchanges being just one example) are more than ready to adapt. Have some faith in the protocol, don’t panic!
CHINESE BITCOIN EXCHANGES REPORT BANKS WILL CLOSE ACCOUNTS
10 APR 2014 
POSTED BY HUGH STARR
BtcTrade announced yesterday via its website, that the Agricultural Bank of China Ltd. informed the exchange that it will close its associated accounts by April 15th if the exchange continues to use accounts for bitcoin-related services.
“We hold a very heavy heart publishing this announcement,” BtcTrade’s website read in statement to its customers. “BTCTrade just received a telephone call from our bank the Kejicheng branch of China Agricultural Bank Hangzhou, that if we do not stop using our bank account to conduct bitcoin related business by 15 April our account will be frozen.”
Aside from BtcTrade, other notable Chinese exchanges have also received notice in regards to the closing of their accounts. One of these is Huobi, who confirmed that they too have received notice of the closing of their accounts from the Industrial & Commercial Bank of China Ltd. Furthermore, according to Bloomberg, Btc100.org has also confirmed reports of the termination of their existing accounts from an unidentified financial lender.
The account closings come after months of rumors have been plaguing the bitcoin community amid uncertainty as to whether or not reports were substantive. The account closings have weighed a heavy burden on the price of bitcoin over the past several weeks following the PBOC’s original announcement in December barring financial institutions from buying and selling bitcoin related products and services.
The PBOC’s new requirements have forced domestic financial institutions to close the accounts of over 10 Chinese-based bitcoin exchanges. Origin of the original source of the PBOC’s ban came from Caixin on 27 March, and has been debated throughout the bitcoin community in regards to its credibility ever since. The report, which has long been speculated as rumor, is proving to be true, in that all lender accounts associated with domestic exchanges must indeed be closed by 15 April.
BtcTrade, despite facing difficult times, remains positive on the future of bitcoin. ”We want to say: The passing madness continues into the distance but we firmly believe that the future is bright for BTCTrade and for the future of bitcoin,”
In other news, BTC China is facing similar hardships, “People are scared, people are sitting on the sidelines,” BTC China CEO Bobby Lee said Thursday. However, unlike its counterparts, BTC China still has yet to receive any form of a formal notice in relation to the possible termination of accounts from its lenders.
“The people who are actively trading are few and far between,” he said. “Certainly, the mainstream audience, if they ever get back in, is sitting on the sidelines.”
However, Lee reiterates that while Bitcoin is facing strict regulation in regards to how they conduct their business, this is by no means a death knoll for the digital currency.
“So there’s no doubt in my mind that these activities are legal and allowed,” he said. “It’s just about what hoops you have to jump through to conduct these activities.”
As far as Bobby Lee’s insight on the current chaos surrounding bitcoin in China, he says, “It’s a cooling off period,” while adding, “We are still very excited. Everything will have ups and downs.”
Ironically enough, a representative from the PBOC in January said, “We don’t want to suppress or discriminate against bitcoin, we are simply saying it is not a currency.”
Coin Desk .....
Deposit Freeze at Chinese Exchanges Drives Bitcoin Price Below $400
The price of bitcoin on the CoinDesk USD Bitcoin Price Index (BPI) fell below $400 for the first time since November 2013 on 10th April, as major China-based bitcoin exchanges began reporting that they had received notice that their bank accounts would be shut down by banking partners.
The initial drop occurred following an announcement from Chinese exchange BTCTrade.com, which was then corroborated by similar statements from Huobi and BTC100.org.
The price of bitcoin has fallen rapidly in recent weeks, after rumors surfaced on 27th March that suggested the PBOC, China’s central bank, would be looking to more tightly enforce restrictions it passed in December meant to ensure a separation between its nationalized banking system and the nascent digital currency industry.
Though no official announcement of the new policy has been made, the statements from major exchanges suggest that the rumored 15th April deadlinefor the enforcement of this stricter rule interpretation is being enforced.
USD markets plunge 13%
As illustrated by the USD BPI, the sell-off began at approximately 1:00 UTC on 10th April.
The price fell from $440 to $410 within a few hours of BTCTrade.com’s initial announcement, before fluctuating between $407 and $412.
At 15:00 UTC, the price began to fall precipitously, tumbling from $406 to $389 by 15:15 UTC. Two hours later the price briefly climbed above $400 before sliding into the $390 range.
At press time, the price of 1 BTC on the USD BPI was $381.
CNY markets down 11.4%
Chinese markets reacted quickly to the news from domestic exchanges.
According to the CoinDesk CNY BPI, the price slipped from ¥2,726 to ¥2,490 within five hours of the announcement.
After reaching a then-low of ¥2,248, the price fluctuated over the next 10 hours, peaking at ¥2,531 at 8:30 UTC. The price began to fall at approximately 14:30 UTC, slipping from ¥2,508 to ¥2,424 over the next 45 minutes.
At press time, the price of one bitcoin on the CNY BPI was ¥2425.
Bitcoin Price Drops 10% as Chinese Exchanges Stop Bank Deposits
Published on April 10, 2014 at 09:26 BST | Asia, News, Regulation
Bitcoin prices crashed today as Chinese businesses began receiving official deposit shutdown notices from banks, confirming recent suspicions of an impending crackdown. Exchanges will stop account recharging via bank accounts between now and 15th April.
Even though the news has been anticipated for over a week now, bitcoin prices sank under $403 from a high of $450.74 on the CoinDesk Bitcoin Price Index after companies began making public announcements on their sites.
Exchange BTCTrade.com made an announcement just before lunchtime in China, followed shortly after by BTC100.org and Huobi. Interestingly, it appears Chinese banks started with smaller exchanges before working up to those with larger trading volumes.
The announcements have all come via the banks themselves, as the PBOC has still not provided exchanges with any official announcement ‘on paper’.
BTC Trade’s statement read:
BTC China CEO Bobby Lee said his company would not be changing any of its banking arrangements until it receives some form of official notice, which hasn’t arrived yet.
BTC38.com, which specializes in altcoin trading, suspended account funding via bank deposits on 4th April.
At that time, prices of digital currencies other than bitcoin dropped by 20% or more. Hardest hit were megacoin (MEC) and TAGcoin (TAG), which each lost around 50% of their value, while quark fell by 40% and dogecoin around 25%.
Even litecoin, which is traded on most major platforms and is not considered an altcoin per se in China, fell by over 20% in value last week. It is currently trading on BTC-e for just $10.22.
Focus elsewhere
OKCoin and FXBTC also stopped some account funding options after receiving notices from their banks and payment processor partners, but promised to continue trading otherwise after April 15th.
OKCoin CEO Star Xu said, however, that the company was focused more on future expansion plans, and would maintain regular daily operations otherwise.
Said Xu:
Community unperturbed
In fact, much of China’s bitcoin community shares that spirit and does not seem perturbed by regulatory moves.
“OK is always here, rumor-spreaders can leave now, we already have plans for April 15th,” said OKCoin’s Vice President He Yi.
The industry so far has shown nonchalance in the face of previous government bans, whether implied or actual, since last December, and have developed new ways for customers to move money in and out of exchanges without direct access to bank accounts. These have included a variety of third-party payment processors, pre-paid cards, and a voucher system.
Even BTCTrade’s announcement today ended on a positive note, informing of the company’s intentions to expand overseas in the near future.
“Very soon we will publicly reveal our cold wallet address, and utilize 100% proof of reserves, in order to ascertain that the platform does not engage in any transactions, and that user assets are safe, open to public scrutiny.”
CoinDesk will continue to monitor and update this developing story.
and....
Crypto Coin news ......
Agricultural Bank Of China Notifies BtcTrade
That They Need To Halt RMB “Recharges” By
April 15th
The Agricultural Bank of China, one of the Big Four Chinese Banks, has begun notifying its Bitcoin Exchange clients of upcoming changes to policy. The other 3 “Big Four” banks in China are: The Industrial and Commercial Bank of China, China Construction Bank, and Bank of China. By market capitalization, the Industrial and Commercial Bank of China is the largest bank in the entire world, according to Relbanks 2013 statistics on largest banks in the world. The Agricultural Bank of China is the 6th largest bank in the world by the same measure, outstripping all American Banks besides Wells Fargo and Chase.
Today, BtcTrade and Huobi join OKCoin, FXBTC, and BTC38 in announcing an end to their acceptance of Chinese RMB deposits via bank card recharge. It is worth re-mentioning that Bitcoin is not banned in China. China has merely forced Chinese Bitcoin exchanges to operate outside of Chinese banks, fiscally. China wants to limit the amount of Bitcoins that can be bought by Chinese citizens to a measly $50,000 USD worth annually, thus limiting capital flight by that method.
Today, BtcTrade.com released an announcement on their website titled:
关于BtcTrade于4月15日暂停银行卡充值业务的公告Announcement About the BtcTrade halting of Bank Card Recharges on 4/15.
Bank Card Recharges are the popular way for Chinese RMB to make its way into Chinese Bitcoin Exchanges’ bank accounts. This particular method of RMB “Recharges” or deposits is what is supposedly being choked off by the rumored new PBOC notice: Notice on Further Strengthening Bitcoin Risk Prevention Measures.
The translated text of BtcTrade’s announcement is provided below:
尊敬的BtcTrade用户及广大比特币爱好者：
我们抱着很沉重的心情发布这个公告，BtcTrade刚接收到公司开户行中国农业银行杭州科技城支行的电话通知，要求我司于4月15日停止使用公司帐户进行比特币相关业务的结算，如逾期未停止，将于4月15日冻结公司的银行帐户。在此，BtcTrade不得不决定于2014年4月15日0点后停止处理人民币充值业务，交易提现暂不受影响。
BtcTrade自上线之初就定位于全球市场，我们已经在中国大陆、中国香港、日本、美国等地进行公司注册。近期BtcTrade将开通美元业务，同时日文站现已上线运营，新版也将于4月15日前上线。短期内我们将会通过公布冷钱包地址，进行100%保证金公开，确保平台不参与任何交易，充分保证用户资金安全，请大家监督。
我们是一支简单的团队，在正式运营的这一年中我们一直用心的为大家搭建一个简单、方便、安全的交易平台，不参与任何的交易、没有上线杠杆、做空机制及其它附加业务，团队成员只是希望通过自己的努力一点点的去推动比特币的进程。我们想说：路过疯狂，继续远方，我们坚信BtcTrade的未来是美好的，比特币的未来不可估量！Dear BtcTrade users and the greater Bitcoin community:I write this announcement with a heavy heart, BtcTrade just received a phone call from the HangZhou Science and Technology City Branch of the Agricultural Bank of China requiring that I stop using company accounts to clear Bitcoin trades. If we are late in stopping, they will freeze the company’s bank account on April 15th. As such, at BtcTrade we have no choice but to stop RMB recharges starting 4/15 at 0:00; trading is not affected.Since the beginning, BtcTrade has set out to face the international market. We have already registered as companies in mainland China, Chinese Hong Kong, Japan, and also the United States. Very soon, we will open USD trading; simultaneously, we will open our Japanese website. The new version will be online by April 15th. During the move, we will announce our cold storage address and guarantee 100% transparency. To ensure that the platform doesn’t participate in any trade and that user funds are completely secure, we invite you all to please monitor us.We are a persistent and simple team, in the first year of our formal operation we have been hard at work to build a simple, convenient, yet secure trading platform. We don’t trade on our platform, we don’t offer leverage, shorting, or other services like that. Out team members do what they can to facilitate the development and spread of Bitcoin. We firmly believe that BtcTrade still has a bright future, and Bitcoin’s future will be immeasurable!
Also In China
Huobi, a larger Chinese Bitcoin Exchange than BtcTrade, has also published an announcement today (4/10/14) regarding new notification from their bank: The Industrial and Commerical Bank of China (ICBC). In the announcement, which will be translated later, Huobi revealed that the Zhongguancun branch of the ICBC contacted them to stop using their account. The Zhongguancun branch of ICBC revealed that they received oral notice from their higher ups that Huobi’s account was to be closed. The people that Huobi talked to had not seen a written notice, and they speculated that different branches might be interpreting in different ways.
Regardless, Huobi is also no longer going to be using ICBC as their company bank account. They were also adamant in assuring their users that all funds, Bitcoin and fiat, are 100% safe. In fact, Huobi has stated explicitly that all withdrawals are not affected at all by this news.
In Another Part Of The World…
The 15th largest bank in the world, the National Australia Bank (NAB), also announced that they were closing off accounts of Bitcoin related businesses. This is a shock to many Bitcoin services based out of Australia, namely Coinjar, given that NAB was previously one of the most pro-Bitcoin banks in the entire world. In a blogpost, Coinjar revealed that due to strategic policy shifts by the NAB, the banking relationship between Coinjar and NAB would have to come to an end. They reassured customers that all fiat balances on Coinjar were 100% secure and safe, and made their opinion known:
We’re disappointed with NAB’s decision – as it affects many companies in Australia – but are grateful for the service they’ve provided us to this point and how they’ve handled delivering the news.
USA Today .....
WASHINGTON — U.S. Attorney General Eric Holder warned Tuesday that virtual currencies, including the increasingly popular Bitcoin, may be used to "mask'' money laundering associated with drug trafficking or other illegal activities.
"Virtual currencies can pose challenges for law enforcement given the appeal they have among those seeking to conceal illegal activity,'' Holder told the House Judiciary Committee. "This potential must be closely considered. We are working with our financial regulatory partners to account for this emerging technology.''
Bitcoin is a decentralized digital currency that is traded mostly online and person to person rather than through banks. The unregulated cybercurrency has been gaining popularity in the USA and accepted as payment at scores of businesses.
"Those who favor virtual currencies solely for their ability to help mask drug trafficking or other illicit conduct should think twice,'' Holder said. "The department is committed to innovating alongside this new technology in order to ensure our investigations are not impeded by any improvement in criminals' ability to move funds anonymously.
"As virtual currency systems develop, it will be imperative to law enforcement interests that those systems comply with applicable anti-money laundering statutes and know-your-customer controls.''
The attorney general's currency assessment was part of a wide-ranging -- and briefly contentious -- congressional hearing on Justice operations.
Although it has been nearly two years since the Republican-led House voted to hold Holder in contempt, time apparently has not healed all wounds.
Holder angrily challenged Rep. Louie Gohmert, R-Tex., after the lawmaker referenced the contempt finding during the attorney general's testimony.
"You don't want to go there,'' Holder told Gohmert, referring to the 2012 dispute over the administration's handling of a botched gun trafficking investigation that resulted in the contempt finding. "It was inappropriate; it was unjust.''
Holder's remarks prompted a heated response from Gohmert: "I don't need a lecture from you about contempt.''
"And I don't need a lecture from you, either,'' Holder said.
The clash ended, at least for now, when Gohmert's time for questioning expired.
On an unrelated matter, Holder acknowledged that a federal inquiry continues involving former CIA director David Petraeus.
Holder said federal authorities are "working diligently to resolve'' the matter involving Petraeus, who was forced to resign in 2012 after admitting to an extramarital affair. Authorities have been investigating whether classified information in the former director's possession had been compromised.
The attorney general, who Tuesday characterized Petraeus as "great colleague'' and "a true patriot,'' said the inquiry remains "an ongoing investigation.''
Rep. Jason Chaffetz, R-Utah, said that the prolonged inquiry "doesn't seem fair.''
"It seems suspicious that it continues to linger,'' Chaffetz said.
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