02.26.14

Why BitCoin isn’t for shitty little people: Reason #1, the Ponzi Twins

Posted in Culture of Lickspittle, Fiat money fear and loathers at 3:44 pm by George Smith

The most seen faces of BitCoin, until the Mt. Gox failure and replacement by the Waiting for BitCoin Godot guys.

Bitcoin holdings of Tyler and Cameron Winklevoss:

$64.1 million

Source: The New York Times, today.

What makes the Ponzi Twins so swank?
It’s all that money in their BitCoin tank!
And how did the Ponzis get so swank?
Who knows, buddy? Don’t be a crank!

Even Nobel laureates in the Manhattan Project never approached the worth of the Ponzi Twins.

From the man the Reg used to refer to as McClunker:

A US senator is asking the federal government to take this remarkable step: completely ban Bitcoin.

Joe Manchin, a Democratic senator representing West Virginia, sent a letter Wednesday to the Treasury Department, the Federal Reserve, and other regulators characterizing the virtual currency as encouraging “illicit activity” as well as being “highly unstable and disruptive to our economy.”

Manchin, who is a member of the Senate banking committee, suggested in the letter — titled “Manchin Demands Federal Regulators Ban Bitcoin” — that a complete prohibition was appropriate because Thailand, China, and South Korea have already enacted severe restrictions or bans of their own.

It’s unlikely that the Federal Reserve and the executive branch possess the statutory authority to prohibit Bitcoin without a new law enacted by Congress and signed by the president — making Manchin’s letter something of a publicity stunt.

No one listens to Joe Manchin. More unintentionally humorous, he’s the famous Senator from a state where most of the people have little or no money: West Virginia.

Unintentionally funny random headline:

Larry Summers Optimistic About Bitcoin Amid Huge Thefts

BitCoin supporter on-line speech of the day:

Hello Mr. Casey,

I read your [Wall Street Journal] article today. I feel deceived by you.

You requested to speak with me, so I took time out of my day to do so. We talked for 20 minutes, during which time I conveyed to you my sentiments about the Bitcoin ecosystem and the matter of MtGox’s collapse. My message was unambiguously a positive one. I didn’t focus whatsoever on the personal funds I lost at Gox. Indeed, the impetus for your call was my heartfelt post on Reddit.

Yet, you ignored everything I said. The only quote that you published from me in the Journal’s cover story was “”That’s gone now,” said Mr. Veerhoos, who is based in Panama City, Panama. “There’s no chance of getting that back now.””

Is that really the takeaway you had from our call and from my letter? Is that your idea of journalism? Did I come across with the sentiment of a despairing investor whose confidence has been rattled? It seems you were happy to completely ignore my sentiments, preferring instead to cherry pick the one fact that is least important, in order to paint a narrative that Bitcoin’s biggest problem is that it’s not “regulated.” I didn’t expect you to quote everything I said, but should you not have maintained at least a modicum of fidelity to my message?

I have dedicated my life to building and supporting the Bitcoin project. I don’t give a damn about the money I lost at Gox. That’s not important. What is important is that Bitcoin is resilient and enduring, and will continue to grow and change the world for the better. It is a story of human progress through technology. It is a story of the good seeping into the cracks of a corrupted financial system. It is a story of passionate people struggling against all odds to remedy the calamities brought down upon society from the most potently misguided people and institutions on Earth.

Next time you spend your efforts casting a pall over this cause, please don’t ask me to contribute mine.

-Erik Voorhees

PS – I will be posting this letter openly on Reddit. I will post your reply if you’d like. And if I do, I won’t cherry pick the most misleading points of it, and I will spell your name correctly.

Mr. Vorhees, it is said, lost over $300,000 in BitCoin on Mt. Gox.

From said WSJ piece:

Executives of bitcoin businesses around the world scrambled on Tuesday to shore up confidence …

A number of mainstream merchants recently have started accepting bitcoin for payment, including online retailer Overstock.com, the Sacramento Kings professional basketball team and online dating site OKCupid.

The Mt. Gox mess hasn’t changed the enthusiasm of Overstock.com, which began accepting bitcoin for payment in January. “If we didn’t use greenback dollars because a bank or two failed, the greenback would never have gotten off the ground,” said Jonathan Johnson, executive vice chairman of the discount online retailer.

2 Comments

  1. Ted Jr. said,

    February 26, 2014 at 9:45 pm

    I’m sure Winky and Dinky never met a Ponzi they didn’t like.

    With estimates of losses as high as a billion USCurrency (depends who one reads) the damage control spin is now “proof the free market works” and
    “this is ultimately good for b/coin”.

    I would have to say PT Barnum was a lot closer on this one.

    I was reading Rick Falkinge’s blog earlier and he calls the failed
    x-change “empty Gox” which is the true phonetic incantation of this
    sad excuse for financial parody.

    But wait – there’s more! The FBI is going to investigate — YES YES YES!
    The same clowns who couldn’t find any evidence of wrongdoing by JPM, GS, Corzine, Mozillo are going to solve the Max Keiser whodunit of 2014?

    Where’s the B/Coins all gone….

    A gonzi scheme for 2014.

  2. George Smith said,

    February 27, 2014 at 9:52 am

    Cases in point, from the Guardian:

    Bitcoin was born in disgrace, in the internet’s back rooms, invented as the favored currency of people who didn’t trust the government and often wanted to make transactions that the law would prohibit. Bitcoin was exceedingly popular with online drug dealers, who favored a now-defunct black market known as Silk Road, which was in turn run by a shadowy young hacker who called himself the Dread Pirate Roberts.

    It’s the stuff of thrillers, and it will probably be a great movie one day, but all that back-alley hacker drama was keeping Bitcoin mostly as a punchline instead of a serious currency. Mt Gox, for instance, started as a trading venue for enthusiastic nerds who loved fantasy games; its name, Mt Gox, stands for Magic the Gathering Online Exchange, where users traded cards for the game, giving bitcoins a place in the fringe-culture Venn diagram between Dungeons & Dragons and Renaissance faires. Fun stuff, but not really the stuff of mainstream legitimacy.

    The entrance of the bionic Winklevoss brothers – Mark Zuckerberg’s arrogant nemeses – as they accumulated 1% of all the bitcoins in existence only added to the circuslike atmsophere.

    Upshot of column. Now that MtGox is gone, nerds are chastened and the criminals being rooted out, it will be onward and upward.

    http://www.theguardian.com/money/us-money-blog/2014/feb/25/bitcoin-mt-gox-scandal-reputation-crime

    So how does one launder a substantial portion of the “money” supply? It’s like if Mr. Rushmore were gold and someone swiped most of one of the heads. Here, please take my gold president…

    Today’s cite: The collapse of Mt Gox “underscores just how far the bitcoin ecosystem has come,” Cameron Winklevoss told the New York Times.

    Cam and Ty are so swank!
    With lotsa BitCoin in the tank!
    The Ponzis’ future is not blank
    Cuz they have Gox fail to thank!