6 ms·

The huge significance of the BTC-e bust

23 points by thisisit 9y ago

Torai 9y ago
http://archive.is/pwJLQ http://archive.is/pwJLQ
- Eriselle 9y ago
  Thank you for the link.
- snakeanus 9y ago
  > One more step > Please complete the security check to access archive.fo What were you linking? I can't even get CAPTCHA to appear.
  - SAI_Peregrinus 9y ago
    It's an archive copy of the article for those who don't want to register. Not sure why it wouldn't work for you, there shouldn't even BE a CAPTCHA.
polotics 9y ago
The backlash against crypto is seriously heating up. This one goes to the long list of obituaries. Quote: """Meanwhile, with bitcoin demonstrably a more expensive and arduous network to manage than the standard fiat currency network, bitcoin can only become some sort of luxury payment system where users pay a premium for the privilege of using it.""" The joke about fiat currency will beobvious the day hyperinflation happens. But of course it never does. Just bog standard seigniorage I guess...
- pavel_lishin 9y ago
  How is Bitcoin more expensive and arduous to manage than, say, Visa's huge infrastructure?
  - deleted 9y ago
    [deleted]
  - gizmo686 9y ago
    Bitcoin can only support a limited number of transactions per block. If there are more desired transactions then their is room for, then the transaction fees will rise until demand falls to meet supply. This is happening, and the current dispute in bitcoin is how to increase supply.
    - pavel_lishin 9y ago
      But that's the cost of use, not management.
      - gizmo686 9y ago
        They are equal. The transaction fees go to miners. The difference between the value of fees and cost of mining is the miners profit. If the profit gets too large, new miners enter. This increases the cost of maintaining the network until it meets the net value of transaction fees (plus newly minted coins).
- mr_spothawk 9y ago
  > what happens to the core bitcoin business case once all known operators, exchanges and dealers have to abide by exactly the same regulations that govern conventional currency. See... this is the sort of question that I love to hear. It's a shining example of the weakness and bias of the current system: it's only a problem to transact bitcoin if you're trying to exchange it to a gov't issued currency. there's a chain of reasoning that starts at "if my grocer could just sell me groceries for bitcoin" and ends at "yeah, I guess property taxes will continue to need to be paid in gov't issued currency" at the end of that chain is the catastrophic tipping point where hyperinflation happens. maybe we'll neuter the war machine when we get there... who knows.
  - marblar 9y ago
    Hyperinflation of government-issue currency or bitcoin?
- ringaroundthetx 9y ago
  I was going to write something similar. It is extremely odd timing to write that the same week bitcoin is getting upgraded to be able to compete with VISA level payment networks. Its like, sure, maybe any other time over the last eight years. But even then it would have been disingenuous to suggest that was the death knell of the concept, since it can be upgraded.
wyager 9y ago
I don't know how international law works, so can someone explain this to me? > A grand jury in the Northern District of California has indicted a Russian national Can a jury in China indict me here in the US? Is enforcement of indictments from other countries down to treaties between the indicter and indictee?
- deleted 9y ago
  [deleted]
- ryanlol 9y ago
  China can indict you in China. US probably won't extradite you to China to face charges, but there's nothing to stop China from kidnapping you from e.g. Thailand if you ever decide to go to that part of the world.
- flashdance 9y ago
  If you're curious why this guy is being indicted in California in the first place, IIRC it appears that he laundered some of his money at the now-defunct San Francisco based exchange Tradehill. As well, BTC-E did business with Americans which is a big no-no if you don't have KYC and AML compliance.
- openmosix 9y ago
  Related discussion to "Can a jury in China indict me here in the US?" https://news.ycombinator.com/item?id=14861925 https://news.ycombinator.com/item?id=14861925
patmcguire 9y ago
I remember back in 2014 when there was a new Javascript framework on the front page of HN every day. Now it's a new blockchain heist. This can't continue, right?
- ringaroundthetx 9y ago
  of course it can, it will just stop being international news every time single time. if the same standard was made for national currency heists over electronic means, your feed would have nothing else in it. ACH Fraud alone is still in the hundreds of millions every year, and in US has at least 3 federal government agencies tracking and trying to address it, for decades. cryptocurrency is comparably much easier to solidify and upgrade, while educating on best practices.
ztauras 9y ago
I'm thinking will the prices go up or down after this. Sure it will be harder for criminals to exchange their btc to fiat currency, but the interest in crypto currencies now is very high, so it will lower the supply of bitcoins?
onestone 9y ago
Article incorrectly states that BTC-e was "Bulgaria-based", like many other articles unfortunately. There is zero evidence for that: https://bivol.bg/en/no-bulgarian-connection-found-so-far-in-us-indicted-bitcoin-exchange-btc-e.html https://bivol.bg/en/no-bulgarian-connection-found-so-far-in-...

23 points by thisisit 9y ago

Torai 9y ago

http://archive.is/pwJLQ http://archive.is/pwJLQ

Eriselle 9y ago
Thank you for the link.
snakeanus 9y ago
> One more step > Please complete the security check to access archive.fo What were you linking? I can't even get CAPTCHA to appear.
- SAI_Peregrinus 9y ago
  It's an archive copy of the article for those who don't want to register. Not sure why it wouldn't work for you, there shouldn't even BE a CAPTCHA.

polotics 9y ago

The backlash against crypto is seriously heating up. This one goes to the long list of obituaries. Quote: """Meanwhile, with bitcoin demonstrably a more expensive and arduous network to manage than the standard fiat currency network, bitcoin can only become some sort of luxury payment system where users pay a premium for the privilege of using it.""" The joke about fiat currency will beobvious the day hyperinflation happens. But of course it never does. Just bog standard seigniorage I guess...

pavel_lishin 9y ago
How is Bitcoin more expensive and arduous to manage than, say, Visa's huge infrastructure?
- deleted 9y ago
  [deleted]
- gizmo686 9y ago
  Bitcoin can only support a limited number of transactions per block. If there are more desired transactions then their is room for, then the transaction fees will rise until demand falls to meet supply. This is happening, and the current dispute in bitcoin is how to increase supply.
  - pavel_lishin 9y ago
    But that's the cost of use, not management.
    - gizmo686 9y ago
      They are equal. The transaction fees go to miners. The difference between the value of fees and cost of mining is the miners profit. If the profit gets too large, new miners enter. This increases the cost of maintaining the network until it meets the net value of transaction fees (plus newly minted coins).
mr_spothawk 9y ago
> what happens to the core bitcoin business case once all known operators, exchanges and dealers have to abide by exactly the same regulations that govern conventional currency. See... this is the sort of question that I love to hear. It's a shining example of the weakness and bias of the current system: it's only a problem to transact bitcoin if you're trying to exchange it to a gov't issued currency. there's a chain of reasoning that starts at "if my grocer could just sell me groceries for bitcoin" and ends at "yeah, I guess property taxes will continue to need to be paid in gov't issued currency" at the end of that chain is the catastrophic tipping point where hyperinflation happens. maybe we'll neuter the war machine when we get there... who knows.
- marblar 9y ago
  Hyperinflation of government-issue currency or bitcoin?
ringaroundthetx 9y ago
I was going to write something similar. It is extremely odd timing to write that the same week bitcoin is getting upgraded to be able to compete with VISA level payment networks. Its like, sure, maybe any other time over the last eight years. But even then it would have been disingenuous to suggest that was the death knell of the concept, since it can be upgraded.

wyager 9y ago

I don't know how international law works, so can someone explain this to me? > A grand jury in the Northern District of California has indicted a Russian national Can a jury in China indict me here in the US? Is enforcement of indictments from other countries down to treaties between the indicter and indictee?

deleted 9y ago
[deleted]
ryanlol 9y ago
China can indict you in China. US probably won't extradite you to China to face charges, but there's nothing to stop China from kidnapping you from e.g. Thailand if you ever decide to go to that part of the world.
flashdance 9y ago
If you're curious why this guy is being indicted in California in the first place, IIRC it appears that he laundered some of his money at the now-defunct San Francisco based exchange Tradehill. As well, BTC-E did business with Americans which is a big no-no if you don't have KYC and AML compliance.
openmosix 9y ago
Related discussion to "Can a jury in China indict me here in the US?" https://news.ycombinator.com/item?id=14861925 https://news.ycombinator.com/item?id=14861925

patmcguire 9y ago

I remember back in 2014 when there was a new Javascript framework on the front page of HN every day. Now it's a new blockchain heist. This can't continue, right?

ringaroundthetx 9y ago
of course it can, it will just stop being international news every time single time. if the same standard was made for national currency heists over electronic means, your feed would have nothing else in it. ACH Fraud alone is still in the hundreds of millions every year, and in US has at least 3 federal government agencies tracking and trying to address it, for decades. cryptocurrency is comparably much easier to solidify and upgrade, while educating on best practices.

ztauras 9y ago

I'm thinking will the prices go up or down after this. Sure it will be harder for criminals to exchange their btc to fiat currency, but the interest in crypto currencies now is very high, so it will lower the supply of bitcoins?

onestone 9y ago

Article incorrectly states that BTC-e was "Bulgaria-based", like many other articles unfortunately. There is zero evidence for that: https://bivol.bg/en/no-bulgarian-connection-found-so-far-in-us-indicted-bitcoin-exchange-btc-e.html https://bivol.bg/en/no-bulgarian-connection-found-so-far-in-...