The US government has never made secret that it is keeping a close eye on virtual currency Bitcoin, but now it appears that scrutiny has turned into a crackdown on the decentralized digital currency.On Tuesday the US Department of Homeland Security blocked the ability to process Bitcoin payments through Dwolla, an Iowa-based startup that allows customers to transfer their dollars into Bitcoins.The authorities allege that the company has been operating as an unlicensed money transmitting business, because Dwolla was not registered with the Department of Treasury’s network.The timing of the crackdown is no coincidence. On May 17 in San Jose, Silicon Valley, California starts ‘Bitcoin 2013: The Future of Payments’, summit entirely focused on Bitcoin and its growing impact on the payments landscape.The popularity of Bitcoin is skyrocketing, as the use of electronic currency looks more appealing to investors and customers worldwide. That threatens the long-held bread that governments and banks have had on currency regulation and interest rate manipulation, RT’s Marina Portnaya explains.To its disappointment, the financial industry finds itself being removed from the way the Bitcoin business is operating, while some American small businesses are starting to accept Bitcoins.The Bitcoin concept first emerged in 2008. The idea was for users to avoid banks when transferring cash by connecting directly with each other. “Bitcoin is a fundamental protocol for money over the internet. Launched in January 2009, Bitcoin is a decentralized peer-to-peer payment system, entirely regulated by its users. Whereas legacy payment systems rely on third-party intermediaries for access, execution and management, Bitcoin transactions are secured through a distributed computing network, seamlessly enabling direct monetary transactions. The supply of Bitcoins is regulated by software and cannot be manipulated by any government, bank, organization or individual. There have been more than 11 million Bitcoins created to date, with 21 million maximum possible. Visit bitcoin.org for more information.”(From press release on www.prweb.com) Customers worldwide can spend Bitcoins to buy things without having to pay the normal, higher fees, so there is little wonder it’s becoming so popular.The currency’s value reached a record high in April, and its subsequent decline is partly being put down to the pressure of red tape.The US government has targeted Dwolla exchange company probably because the banks, which “actually own the US government” are “running scared,” political activist and blogger Mike Gogulski told RT. At the time of global crisis the banks believe Bitcoin is “an existential threat” that could “pull legs from under them.”Many believe Bitcoin is either extremely volatile or pure and simple bubble, but Gogulski believes that trusting a currency is a matter of faith.Humans have used many items as money, while sometimes devaluated banknotes were burnt in ovens to heat homes.“Bitcoin is a long-term play right now. I see Bitcoin holding a much brighter future for us where we don’t have the weight of the banks and financial industry crashing down and squeezing so much human energy out of our planet,” Gogulski said.History is going to prove that there is room for independent currencies, whether they’re digital or not, he believes.Bitcoin, just like the internet, is “out there” and cannot be put away easily, he pointed out.“An independent non-political currency is going to arise and supplement, or at least strongly complement the existing national currencies,” Gogulski shared.Bitcoin is a currency with no material value, but that is not a problem, because “to some extent no currency at all has a material value,” he said“The value of currency arises by means of social consensus. When we agree that a certain thing, whether it be atoms of gold or pieces of paper, or numbers in an accounting ledger, or Bitcoins, has value and we trade in it, and express our faith in it that way – than it does require value through social exchange,” political activist explained.“How does it acquire value? It acquires value by people using it,” Gogulski concluded. … Read More
US seizes top Bitcoin exchange as crackdown begins
The American government has previously made it clear that officials are watching Bitcoin, a decentralized economic currency that international regulators have not yet been able to control. Many of those who favor Bitcoin use Dwolla, an Iowa-based startup that allows customers to transfer their dollars into Bitcoins. Unfortunately for those consumers, the Department of Homeland Security issued a warrant Tuesday effectively shutting down Dwolla’s ability to process Bitcoin payments, as reported by CNET. Whether because of the DHS’ charge of operating an “unlicensed money transmitting business,” the sudden timing of the allegations, or another reason, Dwolla and Mt. Gox officials have been reluctant to comment. “In order not to compromise this ongoing investigation being conducted by ICE Homeland Security Investigations Baltimore, we cannot comment beyond the information in warrant, which was filed in the District of Maryland [Tuesday],” said Nicole Navas, a representative for US Immigration and Customs Enforcement. The warrant claims Mt. Gox CEO Mark Karpeles did not disclose he operated a financial transfer site when he opened a new bank account for the business. Money transmitting services, according to Gawker, are required to register with the Department of Treasury’s Financial Crimes Enforcement Network (FinCen). Mt. Gox, which is involved in roughly 63 per cent of all Bitcoin purchases, has not done so.Despite the technicalities skeptics are wondering if Bitcoin’s friction with the Treasury department is the cause of this recent scrutiny. Senator Chuck Schumer (D-New York) said the anonymity afforded by the service provided an “online form of money laundering” and campaigned for its downfall. “Literally, it allows buyers and users to sell illegal drugs online, including heroin, cocaine, and meth, and users do sell by hiding their identity through a program that makes them virtually untraceable,” Schumer said during a 2011 news conference. “It’s a certifiable one-stop shop for illegal drugs that represents the most brazen attempt to peddle drugs online that we have ever seen. It’s more brazen than anything else by light years.” Most notably, proponents have asserted that Bitcoin would be impermeable in instances where WikiLeaks, for example, saw its funding evaporate as the federal government pressured PayPal to cut off the whistleblower site’s support network. Bitcoin would be more resistant to a crackdown of that nature. Jerry Brito, a scholar at the libertarian Mercatus Center at George Mason University, told the Washington Post Bitcoin could reduce the cost of financial services by pioneering new business formats. “Bitcoin has the potential to be a boon to the economy and a boon to merchants,” he said, adding that it could “disrupt traditional payment networks that have not been innovative for a very long time.”A blind governmental crackdown would only serve to push Bitcoin further underground, Brito argued. “You can’t put the genie back into the bottle,” he continued. “I hate to say it, but the Bitcoin community needs to start lobbying. It needs to start educating policymakers, lobbyists and influencers about the pros of Bitcoin and the impossibility or the difficulty in getting rid of all the bad uses.” … Read More
Revealed: IRS targeted groups critical to government
President Barack Obama on Monday condemned such actions, announcing that the IRS must be “held fully accountable” if the agency did indeed screen conservatives intentionally — particularly before the November elections. Non-profit groups that requested tax-exempt status were more frequently flagged for audits if they criticized “how the country is being run” or if they contained key words such as “Tea Party”, according to an investigative report from the Treasury Inspector General for Tax Administration (TIGTA).Seeking to “make America a better place to live” and criticizing government spending were also red flags for IRS workers deciding which groups to audit. Key words that generated closer scrutiny also included “Patriot” and “9/12”.The IRS began to illegally target “Tea Party or similar organizations” in March 2010, and by June 2011, more than 100 Tea Party-related tax-exempt applications had been flagged for review by the Cincinnati-based IRS unit responsible for overseeing them, according to a draft IRS inspector general report.By July 2011, the IRS had gone from targeting groups with key words to targeting “organizations involved with political, lobbying or advocacy” – and by January 2012, the restrictions were changed to go after “political action type organizations involved in limiting/expanding government, educating on the Constitution and Bill of Rights, [and] social economic reform/movement,” the TIGTA report states.Facing allegations that the IRS was engaged in these practices, former Commissioner Doug Shulman testified before a congressional committee in March 2012, claiming that the agency does not target tax-exempt organizations based on their political affiliations or ideologies.But during the month Schulman was testifying, the IRS changed its criteria for closer examination to include tax-exempt groups “with indicators of significant amounts of campaign intervention (raising questions as to exempt purpose and/or excess private benefit),” the investigative report states.After news about the IRS scheme was reported on Friday, lawmakers have condemned the agency for what Sen. Susan Collins described as a “truly outrageous” breach of public trust.“It contributes to the profound distrust that the American people have in government,” she told CNN, adding that President Barack Obama should publicly condemn the agency.Although the IRS practices targeted conservative groups, the agency established a distrust that could run deep among Americans of every political party.“I don’t care if you’re a conservative, a liberal, a Democrat or a Republican, this should send a chill up your spine,” Rep. Mike Rogers, chairman of the House Intelligence Committee, said while he was calling for a full investigation of IRS practices.Rep. Darrell Issa told CNNon Sunday that this “kind of thing scares the American people to their core”.The IRS has long denied targeting conservative groups for audits, but last week admitted its illegal missteps. Louis Lerner, director of exempt organizations for the IRS,on Friday apologized for the “inappropriate” targeting of conservative organizations.Facing pressure from lawmakers urging the IRS’ public condemnation, the president on Monday denounced the targeting of conservative groups, but failed to directly accuse the IRS of its engagement in such actions.“If in fact IRS personnel engaged in the kind of practices that have been reported on and were intentionally targeting conservative groups, then that’s outrageous and there’s no place for it – and they have to be held fully accountable,” President Obama said Monday after learning of the allegations against the IRS through news reports.The president said he does not want to judge the findings “prematurely”. Both Democratic and Republican lawmakers have called for an extensive investigation into what Senate Finance Committee Chairman Max Baucus called an “outrageous abuse of power”. … Read More
Wall Street Deregulation Coming Soon!
http://www.youtube.com/v/5QWLUtNCWVQ?version=3&f=videos&app=youtube_gdata Read original article: Wall Street Deregulation Coming Soon!
Treasury Secretary: Deficit reduction is not an economic policy
US Treasury Secretary Jacob Lew said Tuesday that reducing the nation’s deficit should not overshadow the need to boost economic growth and job creation. “Important as the deficit is, it cannot be our guiding star. Deficit reduction alone is not an economic policy,” Lew said in a…
When Is The Government Going To Shut Down Bitcoin?
Do you actually believe that the central banks of the world are going to sit back and do nothing while their monopoly over money creation is being threatened? … Read More
Canada tightens restrictions on Bitcoin trading
In the United States, the difficult-to-trace digital currency Bitcoin is largely unregulated. Recently, the Treasury Department has issued some guidelines, though they remain rather broad.The regulatory environment in Canada, however, is rather more strict, as several Bitcoin entrepreneurs have found out.Bitcoin drew international attention through Cyprus’s banking emergency, its inclusion in the American financial regulatory framework, and increasing press coverage. The currency recently spiked to as high as $266 before crashing to a low of about $50, then rebounding to a post-crash high of $162.Continue Reading… … Read More
