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itwbennett writes They of the square jaws and famous dispute with Mark Zuckerberg over the origins of Facebook, are also believed to be among the largest holders of Bitcoin in the world. Now they want to launch a regulated Bitcoin exchange—named Gemini, of course. To bolster confidence, they said they have formed a relationship with a chartered bank in the state of New York. "This means that your money will never leave the country," the twins wrote in a blog post. "It also means that U.S. dollars on Gemini will be eligible for FDIC insurance and held by a U.S.-regulated bank.
79 comments | about a week ago
sarahnaomi writes On Wednesday, prosecutors in the Silk Road trial began to lay out the wealth of evidence found on the laptop taken from accused kingpin Ross Ulbricht in a San Francisco library in October 2013. The evidence presented by prosecutor Timothy Howard was the most comprehensive and damning thus far, including more than a thousand pages of chats between the site's pseudonymous operator Dread Pirate Roberts and Silk Road administrators. Also entered into evidence was a journal that dates back to at least 2010 describing the creation and operation of the site. FBI computer scientist Thomas Kiernan, the second witness in the trial, testified about the day Ulbricht was arrested and the evidence gathered from his laptop.
180 comments | about two weeks ago
Today, the conclusion of my talk with Jim Blasko (here's part 1), who encourages you to go start your own crypto currency, because it's a fun exercise and because every entrant adds new ideas to the mix. As you'd expect, he's bullish about both his own Unbreakable Coin and cryptocurrencies more generally; how any given given currency performs, though, is an open question: U.S. dollars, Euros, or Yen may not go experience any meteoric rises, but their stability, even with inflation, is a nice feature, and so is their worldwide convertibility.
Regulation, speculation, fraud, and cultural fashions all play a role in making new currencies risky; reader mbkennel yesterday asked an insightful question: "Are you up to loaning bitcoin or something less popular for 10 years?" Confidence in any given currency can be tested with the terms current holders are willing to accept to make loans payable in that same currency. (On the other hand, if large companies will accept it in payment, they've probably got an idea that a given currency will be around next month or next year.) If you've bought any form of crypto currency, what's been your experience, and what do you expect in 10 years? (Alternate Video Link)
39 comments | about two weeks ago
Las Vegas seems an appropriate place for cryptocurrency businesses to emerge, both because the coins themselves are so volatile that some gambling instinct may be required, and because Vegas is a high-tech outpost with lower taxes and lower rents than many other West Coast hot-spots, well-suited to risky startups with ambition but without huge venture backing.Jim Blasko moved there to work on low-voltage engineering for Penn & Teller, and is a qualified Crestron programmer, too (useful in a town that looks from the air like one giant light-show), but has shifted to a quite different endeavor, or rather a complex of them — all related to cryptocurrency. I ran into Blasko during this month's CES, at a forum with several other cryptocoin startups, and the next day we met to talk about just how hard (or easy) it is to get into this world as an entrepreneur.
Blasko has some advice for anyone who'd like to try minting a new cryptocurrency. Making your own coin, he says, is the easy part: anyone can clone code from an existing entrant, like Bitcoin, and rename the result — and that's exactly what he did. The hard work is what comes after: making worthwhile changes, building trust, and making it tradeable. Blasko's done the legwork to get his own currency, which he's bravely called "Unbreakable Coin," listed on exchanges like Cryptsy, and is working on his own auction site as well. He's also got an interesting idea for cryptocoin trading cards, and had a few prototypes on hand. (Part 1 is below; Part 2 to follow.) Alternate Video Link
55 comments | about two weeks ago
rossgneumann writes The defense team for Ross Ulbricht, the 30-year-old man accused of running the online black market Silk Road under the pseudonym Dread Pirate Roberts, just dropped an unexpected new theory: Mark Karpeles, the CEO of failed Bitcoin company Mt. Gox, is the real Dread Pirate Roberts. "We have the name of the real mastermind and it's not Ulbricht," Joshua Dratel, Ulbricht's lawyer, said in court today. He plans to argue that Karpeles framed Ulbricht.
119 comments | about two weeks ago
An anonymous reader writes "The virtual currency Bitcoin lost 21 per cent of its value yesterday, equating to a total loss this year of 44 per cent. Reports have suggested that this rapid fall is squeezing computer supporting systems and is raising alarm about its future viability. Bitcoin's value fell to $179.37, 85 per cent lower than its record peak of $1,165 at the end of 2013. In total, nearly $11.3bn has been lost in Bitcoin's value since its 2013 high. The decline has raised concern for Bitcoin 'miners' who support the transactions made in the digital currency, and whose profits become squeezed as its price falls against traditional currencies." The Coindesk article in the linked story gives a blow-by-blow on yesterday's valuation drop; right now, Bitcoin has jumped back up and stands at just over $216.
290 comments | about two weeks ago
sarahnaomi (3948215) writes "The trial began this week for Ross Ulbricht, the 30-year-old Texas man accused of being the mastermind behind the dark net drug market, Silk Road. But as the jury began hearing testimony in the case, it was clear the technological knowledge gap would impede the proceedings. Judge Katherine Forrest said right off the bat when the case began that "highly technical" issues must be made clear to the jury. "If I believe things are not understandable to the average juror, we will talk about what might be a reasonable way to proceed at that time," she said. After the first day of proceedings, Forrest told the prosecution to be more clear with explanations of concepts central to the case, noting she was unhappy with its "mumbo-jumbo" explanation of the anonymizing service Tor. She also requested all readings of chat transcripts include emoticons."
303 comments | about two weeks ago
angry tapir writes "In order to build a case against the notorious Silk Road underground marketplace, a team of U.S. law enforcement agencies spent well over a year casing the site: buying drugs, exchanging Bitcoins, visiting forums and even posing as a vendor, although they did stop short of selling any illicit goods. From March 2012 until September 2013, Federal agents closely tracked the site, making over 50 drug purchases, according to Jared DerYeghiayan, an agent with the Department of Homeland Security who was part of a special investigation unit looking into the site.
129 comments | about two weeks ago
blottsie (3618811) writes If implemented correctly, the proliferation of online voting could solve one of the biggest problems in American democracy: low voter turnout. The 2014 midterms, for example, boasted the lowest voter turnout in 72 years. Making it easier to vote by moving the action from a polling station to your pocket could only increase turnout, especially in the primaries. Making online voting work is infinitely harder than it initially seems. However, in the past few years, there's been a renewed effort to solve the conundrum of online voting using a most unexpected tool: Bitcoin. The key idea is this: The main job in online voting is ensuring that the election system records someone’s vote the way they intended. Running votes over the blockchain, which is public, creates an auditable trail linking a person and their vote. Bitcoin-enabled voters don’t have to place their trust in Florida ballot counters trying to discern the difference a hanging chad and a dimpled chad—nor in black box online voting systems from private companies where what’s happening inside is a mystery. The proof is right there on the blockchain.
480 comments | about three weeks ago
itwbennett writes: After a weekend hack forced the Bitcoin exchange Bitstamp to shut down, Bitstamp has revealed that $5 million worth of bitcoin was stolen during the attack. And that's not all the bad news for Bitcoin this week: Canadian Bitcoin exchange Vault of Satoshi announced it is is no longer accepting new deposits and will close Feb. 5. But in this case the operators are pursuing new business opportunities, saying in a post that the shutdown "has absolutely nothing to do with insolvency, stolen funds, or any other unfortunate scenario."
114 comments | about a month ago
Nerval's Lobster writes Who's responsible when a bot breaks the law? A collective of Swiss artists faced that very question when they coded the Random Darknet Shopper, an online shopping bot, to purchase random items from a marketplace located on the Deep Web, an area of the World Wide Web not indexed by search engines. While many of the 16,000 items for sale on this marketplace are legal, quite a few are not; and when the bot used its $100-per-week-in-Bitcoin to purchase a handful of illegal pills and a fake Hungarian passport, the artists found themselves in one of those conundrums unique to the 21st century: Is one liable when a bunch of semi-autonomous code goes off and does something bad? In a short piece in The Guardian, the artists seemed prepared to face the legal consequences of their software's actions, but nothing had happened yet—even though the gallery displaying the items is reportedly next door to a police station. In addition to the drugs and passport, the bot ordered a box set of The Lord of the Rings, a Louis Vuitton handbag, a couple of cartons of Chesterfield Blue cigarettes, sneakers, knockoff jeans, and much more.
182 comments | about a month ago
twitnutttt writes Customers of Bistamp, the successor (until recently) to MtGox as the highest-volume dollar-denominated Bitcoin exchange, and still the preferred source of trading data for many technical analysts, sent an email at about 4:00 UTC today warning that, "Today our transaction processing server detected problems with our hot wallet and stopped processing withdrawals." They also instructed users to stop sending any deposits immediately or they may be lost. The Bitstamp website has now also suspended all exchange/trading services, and the homepage contains only a maintenance message warning users of a "compromised" wallet. Numerous references to security imply that this is a hacking attack, but Bitstamp reassures that they maintain "more than enough offline reserves to cover the compromised bitcoins."
161 comments | about a month ago
HughPickens.com writes Alina Simone writes in the NYT that her mother received a ransom note on the Tuesday before Thanksgiving.."Your files are encrypted," it announced. "To get the key to decrypt files you have to pay 500 USD." If she failed to pay within a week, the price would go up to $1,000. After that, her decryption key would be destroyed and any chance of accessing the 5,726 files on her PC — all of her data would be lost forever. "By the time my mom called to ask for my help, it was already Day 6 and the clock was ticking," writes Simone. "My father had already spent all week trying to convince her that losing six months of files wasn't the end of the world (she had last backed up her computer in May). It was pointless to argue with her. She had thought through all of her options; she wanted to pay." Simone found that it appears to be technologically impossible for anyone to decrypt your files once CryptoWall 2.0 has locked them and so she eventually helped her mother through the process of making a cash deposit to the Bitcoin "wallet" provided by her ransomers and she was able to decrypt her files. "From what we can tell, they almost always honor what they say because they want word to get around that they're trustworthy criminals who'll give you your files back," says Chester Wisniewski.
The peddlers of ransomware are clearly businesspeople who have skillfully tested the market with prices as low as $100 and as high as $800,000, which the city of Detroit refused to pay. They are appropriating all the tools of e-commerce and their operations are part of "a very mature, well-oiled capitalist machine" says Wisniewski. "I think they like the idea they don't have to pretend they're not criminals. By using the fact that they're criminals to scare you, it's just a lot easier on them."
463 comments | about a month ago
itwbennett writes Nearly all of the roughly $370 million in bitcoin that disappeared in the February 2014 collapse of Mt. Gox probably vanished due to fraudulent transactions, with only 1 percent taken by yet-to-be-identified hackers, according to a report in Japan's Yomiuri Shimbun newspaper, citing sources close to a Tokyo police probe. The disclosure follows months of investigations by police and others into the tangled mess surrounding the disappearance of the 650,000 bit coins.
108 comments | about 1 month ago
MRothenberg writes Bitcoin's not just for libertarians and drug dealers any more! Electronic payment service BitPay this week launched a campaign aimed at making Bitcoin transactions more appealing to mainstream business owners — the first time Bitcoin has been featured in a TV spot. Conceived by Felton Interactive Group, the two new ads promote Bitcoin and BitPay as a secure alternative to traditional credit-card transactions.
127 comments | about 1 month ago
An anonymous reader writes Wired recounts the story of Hal Finney, one of the very first adopters of Bitcoin. Finney died earlier this year after a long fight with Lou Gehrig's disease. But for months before his death, he was a victim of constant harassment from somebody trying to extort his Bitcoins. He and his family faced a variety of threats, and had a SWAT team called on their residence. And it turns out Finney is not alone — other early adopters are being targeted with similar threats. "That's when someone using the names Nitrous and Savaged hacked into [early adopter Roger Ver's] email accounts and demanded that he cough up 37 bitcoins—about $20,000 at the time—in order to prevent his private information from being published online. Ver refused, and the hacker apparently backed off after Ver put a 37 bitcoin bounty on his head. Ver, who was himself sentenced to 10 months in federal prison for illegally shipping explosive across state lines, believes that Savaged is not only the same person who swatted Hal Finney, but also the person who gained access to Satoshi Nakamoto's email account earlier this year."
106 comments | about a month ago
mrspoonsi writes Charlie Shrem, former Bitcoin Foundation board member and CEO of the now-defunct exchange BitInstant, has been sentenced to two years in prison for helping Silk Road users anonymously swap cash for digital currency. Silk Road, as you know, was the online marketplace infamous for hosting anonymous drug and gun sales that was busted by the FBI back in 2013. A version 2.0 went up shortly after that, but it suffered the same fate as its predecessor this November. Based on evidence gathered during the crackdown, Shrem agreed to partner with Robert M. Faiella to trade over $1 million in cash from buyers. Faiella was the one with direct contact to buyers, hiding behind the name BTCKing to post ads promoting his dollar-to-Bitcoin business on the marketplace.
69 comments | about a month and a half ago
First time accepted submitter groggy.android writes This year's biggest news about Bitcoin may well turn out not to be the repeat of its surge in value last year against the dollar and other state currencies but its impending eclipse by another independent but corporate-backed digital currency. Popularly known as Ripple, XRP shot up in value last year along with other cryptocurrencies that took advantage of the hype around Bitcoin. However, among the top cryptocurrencies listed in Coinmarketcap.com, a site that monitors trading across different cryptocurrency exchanges, Ripple is the only one that not only regained its value after the collapse in the price of Bitcoin but has more than doubled from its peak last year. In September it displaced Litecoin to become the second most valuable cryptocurrency. Even more surpising, a Ripple fork, Stellar, is one of the two other cryptocurrencies in the Coinmarketcap top ten that have risen sharply in value during the last few weeks.
What makes Ripple different from Bitcoin? Strictly speaking, Ripple isn't the name of the digital currency but of the decentralized payment network and protocol created and maintained by the eponymous Ripple Labs. Users of the Ripple system are able to transact in both cryptocurrency and regular fiat currency like the dollar without passing through a central exchange. XRP is the name of the native unit of exchange used in the Ripple network to facilitate conversion between different currency types.
144 comments | about a month and a half ago
An anonymous reader writes A new page in the help guide in the payment information of Microsoft's website reveals that the Redmond giant is now accepting Bitcoin as a payment method for products and services on Windows, Windows Phone and Xbox. Currently the payments must go through to credit a Microsoft Wallet account, and the service is initially only available to U.S. users. But the wording of the new page combines with an expansive year for Microsoft and a number of positive statements about Bitcoin from Bill Gates to indicate that this first step is more than just an experiment. Microsoft is now the largest commercial entity accepting the Bitcoin currency, which it processes via the BitPay system, thus protecting the company from fluctuations in the value of Bitcoin. Also at CNN Money.
107 comments | about 2 months ago
1sockchuck writes The use of liquid cooling will accelerate in the next five years, according to experts in high performance computing, who cite the data-crunching requirements of scientific research, cloud computing, bitcoin and "big data" analytics. "In the HPC world, everything will move to liquid cooling," said Paul Arts, technical director of Eurotech. But there's still plenty of resistance from data center operators wary of bringing liquid near servers, and cost is also an issue. Liquid cooling can offer significant savings over the life of a project, but the up-front installation cost can be higher than those for air-cooled systems. Immersion cooling has gotten a surprise boost from the rise of bitcoin, including a large bitcoin mine inside a Hong Kong high-rise.
25 comments | about 2 months ago