For starters, Bitcoins are as cyberpunk as William Gibsons wildest dream: a form of monetary exchange invented in 2009 by a mysterious character who called himself Satoshi Nakamoto but then disappeared from view after unleashing his virtual currency upon the world. Bitcoins are undeniably cool: marvelously mined from the ore of computer processing power and electricity; more ready for prime time than any previous experiment in purely digital money. And Bitcoins, increasingly, are a success. At a Thursday afternoon all-time-high valuation of $72 per Bitcoin, there werearound $700 million worth of Bitcoins in circulation. People are using Bitcoins to buy real goods and services, to hedge against European financial calamity, and to score drugs. Thats money.<\/p>\n
Over the years, Bitcoin has experienced ups and downs; the currency has been targeted by hackers and thieves and botnets and been victim to more than one embarrassing software glitch. But it has persevered, and this week, one can fairly say that Bitcoin came of age. On Monday, the U.S. Treasurys Financial Crimes Enforcement Network (FinCEN) released its first guidance as to how de-centralized virtual currencies should fit into the larger regulatory regime under which currencies of all kinds are required to operate. The word Bitcoin is never mentioned in FinCENs release, but thats just a technicality. Everyone in the Bitcoin community knew who the guidance was aimed at. Bitcoin is a big boy now. The State is paying attention.<\/p>\n
But while some observers have applauded FinCENs guidance as acknowledgment that Bitcoin isnt illegal or considered a threat by the government, not everyone is cheering the news. Because theres a problem here. Bitcoin isnt just an elegant way to create money using peer-to-peer networks and cryptography. Bitcoin is a currency with an ideology. From the beginning, Bitcoin was envisioned as a form of monetary exchange that didnt need third-party financial institutions or central banks or even governments to validate it or back it up. Bitcoin is the fulfillment of a libertarian dream, a currency created out of the workings of the free market, unaffiliated with any state authority, respectful and protective of user privacy and anonymity, and designed to resist inflationary pressures. By its very nature, Bitcoin is made for people who dont want other people to know what they are doing. <\/p>\n
Bitcoin, says financial pundit Max Keiser, is the currency of resistance. <\/p>\n
Thats all fine and dandy, but then here comes the government with its strong suggestion that any organization that facilitates the exchange of Bitcoins into other non-virtual currencies needs to register with the proper authorities and start keeping a lot of bureaucratic paperwork. How does that fit in with the idea of resistance? <\/p>\n
Not very well, as we can learn from one Redditor who chastised his fellow Bitcoin fans for celebrating the legitimacy conferred upon Bitcoin by FinCENs guidance. <\/p>\n
From this situation to total government tracking of money flows and zero possibility to escape their theft, it is but a small step. The tax farmers have co-opted all of you into even more total servitude. But you celebrate that. How servile. <\/p>\n
Sigh. Slave-minded idiots, nearly all of you, naively happy because the eye of Sauron has finally locked its sight on you, celebrating defeat as if it was a victory, cheering like mad cows as your farmers line all of you up at the slaughterhouse. May you get the cages you foolishly cheered for. <\/p>\n
Mr. Eye of Sauron might be a little overheated, but theres a nugget of sense buried in his rage. Theres a contradiction at the heart of Bitcoin. The more popular Bitcoin gets, whether as a symbol of resistance or a perceived safe haven in financially troubled times, the more government attention it will inevitably draw, and the more inexorably it will be sucked into existing regulatory structures. Incomes denominated in Bitcoins will be taxed. Efforts at money laundering will be cracked down upon. Its the price of success. Resistance is futile. <\/p>\n
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More here: <\/p>\n
A libertarian nightmare: Bitcoin meets Big Government<\/a><\/p>\n","protected":false},"excerpt":{"rendered":" For starters, Bitcoins are as cyberpunk as William Gibsons wildest dream: a form of monetary exchange invented in 2009 by a mysterious character who called himself Satoshi Nakamoto but then disappeared from view after unleashing his virtual currency upon the world. Bitcoins are undeniably cool: marvelously mined from the ore of computer processing power and electricity; more ready for prime time than any previous experiment in purely digital money. And Bitcoins, increasingly, are a success Continue reading