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Can Bitcoin Help Stop Flow of Funds to Terrorists?

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The United States military is studying digital currencies like bitcoin to learn if they can be traced and to figure out how they are used by America's adversaries around the world.

CNBC has learned that the global policy counsel of the Bitcoin Foundation flew to Florida to meet with officials from U.S. Special Operations Command for a daylong discussion Monday on the role of so-called cryptocurrenciesof which bitcoin is the best knownin illicit finance.

The first-of-its-kind discussion came just as U.S. warplanes began flying missions over Syria in President Barack Obama's effort to check the advance of the Islamic terror network ISIS. A key priority for the U.S. military is stopping the flow of money to ISIS fighters and blocking the network's ability to process profits from kidnapping, extortion and illicit oil sales.

The military's interest in virtual currency is part of an overall effort by special operations forces to understand how their enemies finance themselves, and what intelligence special operators can glean by following the illicit money.

"We're trying to do our best to understand the true scope of the threat that we are dealing with."

"We're trying to do our best to understand the true scope of the threat that we are dealing with," said a defense official who attended the meeting. "We have to fully understand all of the components and functions of the adversary across the globenot just in Syria and Iraqand the manner in which those adversaries raise, hide and move money."

Defense officials said ISIS is part of a global dark network on the Internet that is involved in the use of virtual currencyalthough ISIS itself is "principally funded through means other than virtual currency."

The invitation-only event, called simply the "Virtual Currency Workshop," was held at an office building in downtown Tampa near MacDill Air Force Base where Special Operations Command is based, and it included a meet-and-greet cocktail party at the Marriott Waterside Hotel & Marina on Sunday evening.

It was organized by a little-known but highly influential group called Business Executives for National Security, which facilitates connections between American business leaders and the U.S. military.

The group's members include a who's who of America's corporate and financial elite, according to its website, including Jeff Bezos of Amazon, former AIG CEO Hank Greenberg and David Koch of Koch Industries.

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Can Bitcoin Help Stop Flow of Funds to Terrorists?

PayPal now lets shops accept Bitcoin

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NEW YORK (CNNMoney)

This week, the payment processing company PayPal took its first venture into the world of all-digital money.

Merchants that work with eBay's (EBAY, Tech30) PayPal can now easily start accepting payments from customers that use Bitcoin (XBT), an independent, government-less currency.

PayPal struck a deal with three Bitcoin payment-processing companies: BitPay, Coinbase and GoCoin.

Related: What is Bitcoin?

Bitcoin is an Internet-based system of money specifically designed to cut out middlemen, like banks and governments. So, it sounds odd to have Bitcoin processors. But they make it easier for everyday, non-tech-savvy businesses to accept bitcoins -- and immediately convert them to cash.

But why take bitcoins -- which have fluctuated in price from $1,100 and $400 in the last year -- instead of proven government money?

The system offers much lower transaction fees, which cost businesses a huge amount of money. The 2%-3% that shops pay in credit card swiping fees can obliterate their profits.

Consider this PayPal's first -- but not last -- foray into the world of Bitcoin. The company has made clear that its interest in Bitcoin runs more than skin deep.

In the last year, eBay's two top executives -- CEO John Donahoe and former president David Marcus -- have expressed interest in Bitcoin's technology.

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PayPal now lets shops accept Bitcoin

Special Ops grill bitcoin for its terror fight

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The military's interest in virtual currency is part of an overall effort by special operations forces to understand how their enemies finance themselves, and what intelligence special operators can glean by following the illicit money.

"We're trying to do our best to understand the true scope of the threat that we are dealing with," said a defense official who attended the meeting. "We have to fully understand all of the components and functions of the adversary across the globenot just in Syria and Iraqand the manner in which those adversaries raise, hide and move money."

Defense officials said ISIS is part of a global dark network on the Internet that is involved in the use of virtual currencyalthough ISIS itself is "principally funded through means other than virtual currency."

The invitation-only event, called simply the "Virtual Currency Workshop," was held at an office building in downtown Tampa near MacDill Air Force Base where Special Operations Command is based, and it included a meet-and-greet cocktail party at the Marriott Waterside Hotel & Marina on Sunday evening.

It was organized by a little-known but highly influential group called Business Executives for National Security, which facilitates connections between American business leaders and the U.S. military.

The group's members include a who's who of America's corporate and financial elite, according to its website, including Jeff Bezos of Amazon, former AIG CEO Hank Greenberg and David Koch of Koch Industries.

Read MoreArab Bank verdict risks erosion of anti-terror controls -industry

"We sort of like to fly below the radar," said Susan Maybaumwisniewski, senior vice president for projects at Business Executives for National Security. She said her group has organized previous sessions for U.S. Special Operations Command, putting industry experts in front of American war fighters.

Previous topics have included capital markets and mobile banking. Maybaumwisniewski said the virtual currency event Monday was not specifically focused on ISIS, but rather a long-planned opportunity for the business community to brief the military on virtual currencies.

Among the roughly 100 attendees at the event, said several participants, were business executives and specialists in financial payment processing, experts in bitcoin operations, Silicon Valley executives, representatives from the U.S. Treasury and Department of Homeland Security, as well as members of the U.S. intelligence community.

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Special Ops grill bitcoin for its terror fight

Bitcoin is NOT Napster. Its BitTorrent. — CoinDesk is Galactically Stupid – Video

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Bitcoin is NOT Napster. Its BitTorrent. -- CoinDesk is Galactically Stupid
Donate: https://blockchain.info/address/1LAYuQq6f11HccBgbe6bx8DiwKwzuYkPR3 Subscribe: http://patreon.com/madbitcoins Sponsor: http://MadBitcoins.com September 25th, 2014 -- Melbourne, Australia...

By: MadBitcoins

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Bitcoin is NOT Napster. Its BitTorrent. -- CoinDesk is Galactically Stupid - Video

Bitcoin Savings & Trust Comes Up $40 Million Short On The Trust Part

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Bitcoin is the buzz! Well, the latest buzz anyhow in the weird world of cyber-currencies. It seems like only yesterday that Liberty Reserve went down, see thisbut here we are again.

This article is not whether Bitcoin is going to make it or not as a cyber-currency. There are thousands of articles out that positing that Bitcoin will be different, that this time it is the real thing. Most of those articles seem to written by folks promoting Bitcoins. But there are a few well-researched articles out there that warn that Bitcoins days are numbered, see thisas just one example.

Again, this article is not about any of that. If you want to invest in something that doesnt materially exist, then Im going to be no more critical of you than I would be of anybody who invests in complex derivative contracts on the major stock markets, which are traded by the billions everyday just ask any partner, er, former partner of Lehmann Brothers about those.

No, this article doesnt go so far as to ponder the imponderables about Bitcoin. Instead, it is a lesson about how to invest, or rather not to invest, in Bitcoins, should one be so inclined.

Anytime something is new, and generates a buzz, it attracts both investors and the folks who sell them the investments, known as promoters. Inevitably, with any investments whether in Bitcoins or wheat futures or even seemingly innocuous mutual funds, some promoters are good and some promoters are bad.

Unfortunately, new things typically attract far more than their share of bad promoters. The reason is that many of the good promoters will sit on the sidelines for a while, waiting for things to shake out as they inevitably do. Thus, it is rare that the established investment firms will jump right in to something new. They wait a few years, let the market develop momentum, and then use their huge infrastructure, pools of existing clients, and seemingly endless advertising dollars to enter the movie only after they are convinced that folks are not going to walk out after the first few scenes.

Bad promoters have thus, quite predictably, settled upon Bitcoin like so many vultures. That brings us to the point of this article.

A good example is found in the recent final judgment obtained by the U.S. Securities & Exchange Commission against Mr. Tendon T. Shavers and his Bitcoin Savings & Trust (BTCST), by which Shavers used to defraud his suckers out of more than 700,000 Bitcoins. To give you an idea of the size of this fraud, the judgment entered by the U.S. District Court for the Northern District of Texas requires Shavers to disgorge more than $40 million in ill-gotten gains and interest, and, oh, both Shavers and BTCST are each required to pay $150,000 in civil penalties.

According to the SECs Litigation Release 23090 dated September 22, 2014:

The Commission established, and the Court found, that from February 2011 through August 2012, Shavers offered and sold investments in BTCST over the internet. Shavers solicited all investments, and paid all purported returns, in bitcoins. Operating under the internet name, pirateat40, Shavers solicited investors in online chat rooms and on the Bitcoin Forum, an online forum dedicated to Bitcoin, promising them up to 7% returns weekly based on his claimed trading of bitcoin against the U.S. dollar, including selling bitcoins to individuals who wanted to buy them off the radar. In reality, Shavers used new bitcoins received from BTCST investors to pay purported returns on outstanding BTCST investments, and diverted BTCST investors bitcoins for his personal use. The Court further found that, even as he publicly denied the Ponzi scheme on the Bitcoin Forum, Shavers knowingly and intentionally operated BTCST as a sham and a Ponzi scheme, and repeatedly made materially false and misleading representations to BTCST investors and potential investors concerning the use of their bitcoins, how he would generate the promised returns, and the safety of their investments.

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Bitcoin Savings & Trust Comes Up $40 Million Short On The Trust Part

Greenpeace accepts Bitcoin — Donate for Dark Wallet — DarkCoin Release Candidate 5 – Video

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Greenpeace accepts Bitcoin -- Donate for Dark Wallet -- DarkCoin Release Candidate 5
Sponsor MadBitcoins at http://MadBitcoins.com -- your ad could be here! Bitcoin Rebel Shirts http://www.bitcoinnotbombs.com/bitcoin-rebel-line-sizzles-into-s...

By: MadBitcoins

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Greenpeace accepts Bitcoin -- Donate for Dark Wallet -- DarkCoin Release Candidate 5 - Video


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