Bitcoin Exchange Scam – Bitcoins Are Now Worthless

After considerable thought, I’ve decided to put the Bitcoin Exchange Scammer comment back up as I believe it’s in the public interest, especially so given recent events on Bitcoin Exchanges. For those unaware, every now and then, I receive a … Continue reading

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262 Responses to Bitcoin Exchange Scam – Bitcoins Are Now Worthless

  1. Bitcoins are truly worthless. They have no value as a currency, due to their wild price swings. They resemble a commodity… except they aren’t anything tangible. They’re subject to manipulation due to the nature of the design (a botnet, or a hearty ASIC investment, and you control bitcoin.) They’re only as redundant as the owner makes them (most users aren’t so wonderful at backing up their system).

    It’s a neat social experiment, and cryptocurrency may be the future… but Bitcoin in its current form is not. Make take a lot of people getting burned badly before they realize this, though. Sucker born every minute.

  2. The exchanges can’t just set the global rate like that. People have to be willing to pay a given buy price, or sell at a given sell price. Yes, in a small pool with relatively few exchanges, there is still the potential for a large exchange or consortium of exchanges working together to manipulate the price.

    But that is very unlikely because (1) they would also have to have a massive number of greedy/oblivious buyers and sellers, and (2) they would have to be well coordinated and/or control a huge chunk of the global trade volume.

    Unfortunately, the events of the past few weeks gave them both #1 and #2, simply because millions of ignorant people suddenly discovered Bitcoins and moved into the market using largely a single exchange.

    While nothing is certain, such an event is less likely to happen the more time goes, as an increased number of experienced users will minimize factor #1, and the fact that nearly anyone can create an exchange independent of the others will minimize factor #2.

    I think it’s far too early to pass sentencing on Bitcoin.

    • Bitcoin is a deflationary pyramid scheme used for non legal activities. Sad to say it’s sentence has been passed, just a case of time. It’ll hit hard and fast, like with the online games situation.

      One big sweep.

      Who will they go for? Exchanges? Software creator? Users?? My money is still on exchanges.

  3. The scam is this…

    You give money, they give “credit”… You try to cash-out your “credit”, they say… “Someone already cashed it out”… OMG I was robbed!

    Yea, the second you gave them cash for “fake money”, you were robbed.

    (Note, they DO pay-out small transactions, in hope that you TRUST them with MORE MONEY. Them who? Russian and German Mafia… Potheads… Mexican Cartell? Yea, because they are just waiting to give you $120 for that $50 cash you gave them last month. It makes perfect sense!)

    No, the fact is, they “lie” and say it is worth $100, what was $50… Because they scammed another $50 from someone, and (if they actually payed-out), would possibly be able to give you $100… But they won’t.

    It is monopoly money for you and your friends… It is pure tape if given to a stranger… It is simply a stale donation, if just given away (If they can actually cash-out. Cash out to who? Who wants your bitcoins? Who the hell is paying $120 for your coin… No one, that is why the price falls. Because no one is paying out.)

    Is, and always will be a scam… You can’t even find a real answer about bitcoins, even after you dig for hours through hundreds of links. Useless programs, useless dead sites, useless “bankrupt bitcoin dealer”… bankrupt… what? You just took our money and bitcons, cashed the bitcons, and kept the money.. Bankrupt my donkey, you got all the money!.

    • There’s a german mafia?.

      • Yea, it’s called the Gestapo, Skinnnheads, JugoslawischeDD Mafia, and various other things…

        They were the ones who “handled Zimbabwe” currency printing, and (Print one for you, one for me… one for you, one-two for me… one for you, one-two-three for me…)

        Then went to Zimbabwe, and sold them their own money for 1/10th the price to the citizens, for GBP, Euro, and USD and goods. Thus, the hyper-inflation.

        Now, they, (the German mafia figures), sell the useless printed money that they couldn’t sell back to the Zimbabwe residents, on ebay, as bundles of “untouched money”.

        (You can remove the link… lol…)
        thedailybeast dothere com /newsweek/2008/07/01/where-the-money-isn-t.Html

        Then look-up Zimbabwe currency…

        Actually, I support bitcoins, just not the many “Markets”, which are frauds. There are honest and thriving markets that keep bitcoins solid, stable, and constantly rising in value.

  4. Yes, greed only appeared on the scene after the arrival of bitcoin. Now if we can all just go back to the dollar and euro and all of our troubles will finally be over.

  5. Every ounce of logic in my brain tells me the bitcoin craze will not last and the whole Ponzi scheme will come collapsing soon. Yet, looking at the largest Bitcoin exchange out there (mtgox.Com), its value keeps going up; even after it drops temporarily. That tells me people are buying and holding. As if it is a long-term investment. I have posted some derogatory comments elsewhere and immediately was ridiculed by Bitcoin believers and defenders. Some people are making real good money (and yeah sure, some are losing). Early investors have long cashed-in and gone underground. Satoshi Nakamoto must be a billionaire now and will he ever pay tax on his gains? Of course not. I wonder how is he hiding his money, and what prevents him from issuing an endless supply of bitcoins to himself?.

    • Shh…
      You have misunderstood the block chain and BitCoin protocol. If you UNDERSTOOD BitCoin you could be like me and make some good money, you just have to be firm with yourself on what price you buy and sell at. Don’t be greedy. Basic will power and market analysis will take you much further than listening to all these expert speculators with their “ounce(s) of logic”. I would absolutely love you to show me how Bitcoin isn’t a long-term investment. The reason that BitCoin is spooned up right now is due to lack of security and awareness of the marketplace, and what pump/dump schemes look/sound like, but you think it’s gonna stay that way when you got people with 100million in BitCoin?? The real problem is that it is largely tied to the United States Dollar because that’s what its traded for most often.

      At the moment we’re living in a peculiar moment of time where this entire country’s economy is just in the air…falling but haven’t hit the ground yet. When the dollar crashes, people will FLOCK to BitCoin as long as there is electricity and internet. Initially bartering will make a come-back but eventually demand to use bitcoins for goods and services will become so high that countries across the world will FLOCK to BitCoin to join in. It’s pinned to the underworld drug-market with anonymity and ability to plaundery money, it’s not going ANYWHERE. If you’re smart, you buy and you hold. If not, keep hold of your USD. Gold is overvalued and you can’t sell it on the internet anonymously without tax fees. BitCoin is here now. Learn to adapt or perish.

      • I’ll take this one, why do you think the US dollar will crash?

        Do you seriously think we’ll go as far back as bartering? There is no way bartering will work in the modern day. Especally not in a first world economy like the US.

        If you thought Bitcoin was a good investment, long term, why would you ever sell? Why have you not invested every cent you have into Bitcoin? Could it be doubt?

        Bitcoin is around $105 right now.

        • First world economy…your kidding …oh please tell me you are not stupid enough to believe that. The fact is regardless if you want to admit it our not that all printed currency is worthless. It use to be backed by platinum, gold, and silver. But they did what you think they were doing with Bitcoin. They printed billions over what they had in precious metals to back it. The governments of the world have failed. The BTC, LTC, and FTC are the prime. Greece and China are in full support of crypto currencies. So tell me there mr genious…were do you get your facts. “Welcome to the real world”.

  6. Should read “It seems our GREEDY CROOKED friend is going after the greedy.
    And you would too? No, I wouldn’t.

  7. Sound like the E-GOLD fiasco. Why people just don’t buy/sell actual currencies is beyond me. I short sold the AUD/USD at a smidgen under 1.04. I bought again a tad above 1.02. Only 2c gain you say!?!?! Well, time that by 10 standard lots and well, I earned almost $20,000 in less than a week. GUESS WHAT!!! I CAN CASH OUT MY REAL $COIN$ AT ANY TIME TO ANY BANK IN THE WORLD!!!! Now beat that bittards :D.

    • You had to invest a million dollars. That’s a very large risk, and one many can’t afford to make.

      I started collecting Bitcoins in early 2011 with several of the computers I had lying around. While I didn’t make much, it got me very interested in Bitcoin and I began to monitor the exchange rates. In October 2011, the value crashed from around $40 to $2, and I bought several hundred coins (I believe, 400). Since then I have bought and sold Bitcoins for a decent profit. In April of this year, Bitcoin prices went over $200 and I decided to sell 300 of my slightly-over 500 Bitcoins.

      Your investment: $1,000,000. Profit: $20,000. Percent: 0.02%
      My investment: $1,000 (estimation) Profit: $65,000 (with over 200 Bitcoins still in my wallet, valued at roughly $16.5k). Percent: 8150%

      In case you hadn’t noticed, that Bitcoin investment is 407,500 times more profitable than your government currencies venture.

      But it’s too late to see those kind of profits anymore. You guys were too busy with your hands over your eyes, chanting “It’s not real! It’s gonna fail!”

      The only, and I mean ONLY way it’ll ever fail is if the US and other major governments banned transactions from centralized currencies to Bitcoins.

      • You rolled a dice and won, or do you feel there was inevitability in the profitability of your investments?

        Also, do you realize that your profits come from someone elses loss?.

        • I certainly hope he realize so. But anytime one gain/loses on market price movement, there’s an opposite loss/gain made by someone else who sold/bought from you. Hopefully anyone trading anything realizes that, at a minimum, even if trading randomly/blindly like a gambler.

  8. Ah, now it’s a true currency…this guy is acting exactly like the Federal Reserve.

  9. Dear prospective bitcoin user. Go type “exchange bitcoins for cash” into google search. You see all the red flags going off in your brain now? Run like hell before you get duped. Bitcoin is and always will be a scam created by REMOVED.

  10. Total ponzi scheme. The Winklevii, always looking for the quick fix, big hit will lose all their not-so-hard earned money. Bitcoin is supposed to be the medium of exchange, so why should value fluctuate wildly? It’s more like airline miles ;).

    • So the news rush on Bitcoin has slowed way down. It’s no surprise that the price of
      Bitcoin has stagnated at $113 for a week. It’s all about the hype.

      It took nearly every major news outlet in the world to raise the Bitcoin price from $30 to $200. It won’t be that easy ever again.

  11. We had a bitcoin account and it was hacked via emails. We lost $ in the amount of five figures and spent more time with sorting it out than I care to admit. Bitcoins is corrupt with hackers and who knows what else. The whole scam should be shut down.

  12. Wow, a lot of people talking out their BITCOINS about something they know little to nothing about.
    It’s hard to pick any one comment to respond to.

    Jay,
    a “hearty” ASIC investment wouldn’t give you control of anything. It would just be a large investment in ASIC hardware.
    From CNN Money:

    “The power of all the computers networked together to maintain the digital currency’s system far exceeds the combined processing strength of the top 500 most powerful supercomputers.
    That being said, the difficulty of mining scales up to match the amount of people mining. More People mining, the harder it is. So by adding in all those ASIC machines you are actually making it harder to mine. Plus, that’s MINING, not control over the btc already in existence. There is a finite number of btc that can be mined at any given time. This number is not limitless, hence it being harder to mine when there is more people. With a lot of ASICs you would get a higher share of the limited btc being mined each day. Not even close to controlling anything.

    Nerdr,
    Im not even sure what to say, you are lovely, I love you, have my babies.

    JasonD,
    “Yea, because they are just waiting to give you $120 for that $50 cash you gave them last month. It makes perfect sense!”
    “They”? The exchange doesn’t give you a red cent for your money.
    That $120 you get from cashing out is money that another human being, in front of another computer, is paying you for your bitcoins. That’s why it’s called an EXCHANGE.
    You pay someone $50 for some btc, then later you sell and someone pays you $120 for those same btc. The exchange charges a small fee for arranging the transaction, thats it. No decent exchange would ever, EVER, steal a few measely dollars from their clients. Because all it would take is one report about that exchange stealing $10,000 and they would lose all consumer confidence, costing them possibly millions.

    • Mining Bitcoins isn’t free and the cost of power/hardware required to mine Bitcoins is non negligible. In fact, the cost of mining will always grow at parity, and even exceed due to competition, the Bitcoin exchange price. The current Bitcoin price is $130.

      Mining Bitcoins is only profitable when the Bitcoin exchange price is increasing. A speculative environment was perfect for that. Now that the speculation and ponzi scheme period of Bitcoins is over mining will cease to be profitable.

      What happens to Bitcoin at that point is still being decided.

      • The whole point of mining bitcoins is to gradually inflate the currency as use of it grows. Bitcoin mining has nothing to do with making money; that’s simply a side-effect of the process which grows smaller as usage increases.

        What boggles my mind is how some people seem to think that bitcoin is somehow less of a “real” currency than a dollar bill, a fiat currency, a piece of paper backed by absolutely nothing; or that bitcoin is somehow more of a scam than said fiat currency which is constantly manipulated and “legally” counterfeited by the Federal Reserve at the expense of everyone who uses it. What you’re seeing with bitcoin fluctuations is natural market fluctuations; in other words, that’s what happens when people AREN’T with your currency. Bitcoin fluctuates more than the dollar because less people are using them, there are less of them out there, and nobody is with it.

        It appears that many of the bitcoin opponents don’t understand basic economics.

        • Bitcoin is around $100 right now and falling. It was $120 three days ago.

          Is Bitcoin a currency? Yes, it can be used as a means of transaction and trade.

          Is Bitcoin a viable currency that will replace the dollar or should be taken seriously as a replacement means of value transfer and exchange? I think no. The key reason is Bitcoin is deflationary with no price control and high volatility.

          I can’t see people paying taxes in Bitcoins or relying on Bitcoin as a spendable value store.

          Because Bitcoins are deflationary and speculative there is an expectation from nearly every Bitcoin holder that the price will increase. If the dollar in your pocket would be worth more tomorrow why would you ever spend it? This reasoning makes
          Bitcoin unusable as a currency.

          Bitcoin is certain to crash again, and eventually crash big to near zero. This event is more likely now that mining is less of a profitable operation after the 11 million point.

          I should add here that I LIKE the idea behind Bitcoin. It’s an interesting prospect, but let’s remember this is version 1. Bitcoin is not perfect, it does have issues and problems that need further work.

  13. Do you worry about bitcoins? What about the DOLLAR? It’s worth about 2 CENTS, even with all the ‘oversights’ and Congress and committees etc. The US is FINANCIALLY DEAD since it can 1) NEVER pay its debt, and 2) can’t afford to pay the INTEREST either.

    How about the Homie lando Security vans being rolled out (this is 100% true and checked), which will use ‘backscatter’ radiation to check your eye movements and many other things, then higher levels of rays will show your delicate body beneath your clothes (all for your own benefit) and finally they will give full-power x-rays to check INSIDE YOUR BODY to see if you are a living bolomb. This is our “DEMOCRACY”.

    Bitcoins are nothing: this is the early “Wild West” period, all will be fixed after public rage over corruption as mentioned here. Worry about what happened to destroy the US in one decade instead.

    • A debt is only repaid with a fear of collection. The question is: who is gonna collect the US debt? The answer is, no one. The second the US falls, everyone falls. Welcome to globalization.

      Being a country based on laws as it’s fundamental element has left the US open to the concept of loopholes in a big way. We see that for example with the big banks and their tax strategies and offshore accounts.

      I agree with the wild west statement. I also think the wild west period is starting to close on the internet. What will be the next large scale frontier?.

      • Interesting… “The second the US falls, everyone falls. Welcome to globalization.”
        That is the great driving force unifying the world behind the US?
        Sounds more like that would make the US the biggest in the world…
        Its funny how you mention the rule of law as prime in the US, and loopholes as the problem.
        Did you forget the constant corruption of the dollar, interest rates, bond markets, housing markets, by the FED, the POTUS, Wall Street… dont they have something to do with the value of the dollar?
        One thing you CANNOT do with BTC is to endlessly duplicate it.
        People are paying what they think it is worth, in the current exchanges which work better as true “free markets” than almost any part of the US economy at the moment, it seems…
        I really don’t think that you can possibly change anyone’s mind on the web about this, since your article has so many half-truths and incorrect or misinformed assumptions, all framed in a “US-rules no matter what the facts suggest” mentality that, frankly, is an old record that many Americans stopped playing years ago.

  14. It’s true that there’s little oversight or checks on btcs yet- but btcs are NOT made from the beginning to rip off the value of the underlying metals back the dollar (gold and silver, so you could take your “silver certificate” and get real metal for it at the bank).
    This bitcoin revolution is ESSENTIAL to escalating the fight against those intent on the brutal stripping of our hundreds-of-years-old rights to “the pursuit of happiness”, including having ANY personal privacy, soon to be lost to an invasion of drones checking everything outside your home (for example, it reads your meter and sees increased water and electricity: now ‘they’ want to know who is staying there and using this extra water and energy)… and of course INSIDE with advanced technology that is expanding exponentially. EVERY SINGLE ONE of your communications, except for letters, (and it’s ironic how the training of cursive handwriting is now phased out), whether e-mail, phone call, text etc is sucked wholesale into “splitter” cables that take EVERYTHING that the telcos get and funnel it straight into the NSA. The telcos took retroactive immunity from lawsuits against this illegal surveillance, but became slaves of the gov’t surveillance system years ago. This gigantic surveillance from dozens of agencies and hundreds or thousands of x-ray vans and almost limitless proposed drones over our cities seems kind of extreme for a ridiculously insignificant result like “gee, we stopped about 1/2 dozen ‘terrorists’ year”- with absolutely no proof that ANYTHING was prevented- national security, you see… have to kill you if we told you.

    I’d rather have my FREEDOM from this extreme intrusion, which, once started will only increase unless WE THE PEOPLE start getting REALLY angry about all this- RIGHT NOW.

    Bitcoins are a way of starting to anonymize your spending. Instead of a “bank” which reports EVERY transaction over a certain amount (which can change and be as low as $300, and probably is now simply all data the bank has going right into those NSA computers)… even if it’s simply taking out YOUR OWN MONEY that was put into the bank years ago by your own grandmother as a gift 10 years ago.

    Since corporations and the government itself have no respect for the ultimate law of the land (the Constitution, and crucial additions such as the 4h Amendment etc, which are VITAL for an informed public to be able to make decisions in a true representative democracy). Now btc threatens the government’s ability to track every single transaction and build cases against “alleged” terrorists…. I read that the NSA took it’s best 1000 “leads” from its notorious, illegal, unconstitutional data vacuuming and gave these to the FBI. Contrary to the extremely vague statements about how somehow we have been “protected” from a few “terror” events of various kinds (the Underpants? The Shoe? Strange how absolutely inept these supposedly well-trained al operatives turned out to be. I don’t think they knew what they were doing, or they weren’t real operatives. Hey, I don’t want planes beed up either. But the BEST 1000 leads the FBI got from the NSA lead to ZERO terror convictions: ALL these people were INNOCENT CITIZENS. This is the BEST that the NSA’s tremor program against US citizens could come up with. Not very impressive, and it does NOT justify the destruction of the Constitution………

    So our new ‘democracy’ depends on people informing on their neighbors, or reporting some Arab-looking guy on a bus…. Just be very afraid to mention ANYTHING about something you may have done 20 years ago… because terrorists ARE listening! But not Isl wamofas ists,, instead it’s the agents from the NSA, FBI and many other agencies who are now turned INWARD: AGAINST the US public, not bothering as much with potential REAL tremorfists (if there ever were any) from OUTSIDE the US, where the NSA used to focus its gigantic resources. But uncontrollable, unstoppable, freakish peeping Toms with virtually godlike powers to surveil ALL OF US AT ONCE without ANY warrants or oversights beyond a couple of pet judges and black courts. A recent part of the trial against the USS Cole bombing had a subject so secret that its NAME was classified and the defendant could not be in the courtroom to hear any of this classified testimony. I’m not sure if anyone really heard anything, but are you getting the idea how vast this shadow black government is now? How it’s growing exponentially? How storage is so cheap that hard drives are thrown away because replacing them is cheaper than erasing them! I DO NOT CARE about 1 or 2 ‘tremor’ incidents… even 9/ eleven, which has very odd facts such as a US-military doubleuemdee called nano-thermite was found in dust from ALL 3 BUILDINGS. This isn’t a rant against 9/ eleven, it’s a warning to WAKE UP and look around you and try to stop this vast apparatus before we are ALL shut inside our own prison. Bin lines himself said it was not necessary to cause immense damage or destruction in order for his ‘side’ to win: all that was needed was for the US to treat ITS OWN CITIZENS AS tremors and the war on tremor was totally lost… even though BL himself was removed (extra-judicially, illegally, and from my point of view, very stupidly). He had no weapon and he would have been the BEST POSSIBLE INTEL SOURCE ON THE PLANET ON WHAT AL davida WAS UP TO. So one must ask “WHY was he shot down like a dog??” He did NOT confess to 9/ eleven either, so we must ask who did his capping benefit? Not al doody, certainly not BL, who would have died of kidney disease within a year or two anyway… it was the USA who benefitted by using him as a tremor symbol until he was popped, and our Constitution and liberties, previously taken as rights, are now severely curtailed. Drones are in the very near future EVERYWHERE over US cities- “protecting” us, “preventing crime” etc. Our illegal wars disabled about ONE HALF MILLION of our own troops from use of the illegal (under US and int’l law) terror weapon of indiscriminate destruction called ‘depleted uranium’ that we use everywhere: every battlefield, in almost every state for ‘training’ or ‘practice’-it has a half-life of BILLIONS of years, so THERE’S something to really fear. The number of normal births in Iraq is insanely smaller that it should be and it’s getting a lot worse among US vets of the many Middle East wars we started… I will secure my very few bitcoins in a wallet of some kind with encryption that I’m sure the NSA can break in a second, but it’s MY CHOICE to use this, or dollars, or barter, or anything else. Our government, or part of it, has sold out to the enemy itself: I remember when China was barely beneath the USSR as the most evil of Communist nations. Yet suddenly this stopped! The US doesn’t use the term “Red China” any more! Why? Because OUR CORPORATIONS WANT TO USE CHINA’S CHEAP LABOR- and that is more important than ANY political differences. What happened to “Made in the USA”? Well, that goes out the window if the bottom line can improve… so corporations use any and every source of cheap labor possible, regardless of whether it constitutes slavery (‘wage slavery’ can be WORSE than actual slavery, because even the horrors endured by real slaves is limited- humans are valuable property and can’t be abused too much or they can’t work any more. Wage slaves though, CAN be abused without limit, paid virtually nothing, locked up in buildings in Bangladesh that regularly burn down with hundreds of casualties…. If they get sick, throw them out and let them deal with it. Of course big business also wants to use the prisoners of the USA as cheap or free labor too- the USA has more prisoners than any other nation on the planet… not very ‘democratic’ sounding, is it? Drones will be, and already are, flying over our cities and borders. Who said they had the right to surveil people without court orders? Warrantless surveillance rears up again… as sickening as ever,

    In the end, Bitcoins are an anonymous force FOR freedom and anonymity. They aren’t perfect and you can lose money, but some pointed out that banks are using high-def cameras to surveil customers and transmit every single transaction to the NSA, which sucks up all this information as a matter of course every day through places like the NSA room in the AT&T building in San Francisco- EVERY BIT of info is stored. NOBODY is exempt and it’s lifelong. Nobody has ever seen such total tyranny on this planet before and it’s here RIGHT NOW- even though it’s not finished growing by a long shot. Do you believe your dollars are any better than bitcoins? Well, dollars have depreciated since the Fed Reserve Act to the point of losing about 97.5% of their value. That’s democracy. Things are going to get a lot worse with pollution because big corporations rip apart the planet for their profit, then “externalize”- let someone else fix their damage, pay to clean up their chemical and radioactive messes.

    I bet bitcoins will outlast dollars and retain more value in the end. Assume that bitcoins are used as poorly as possible and corruption is as bad as it can get. OK, now compare that to the dollar-laundering casino called “Wall Street” and ask which is worse….. Wall St destroyed the world economy TWICE, with various meltdowns of lesser extent. What did we get? Well, the banks were “too big to fail” so the gov’t paid massively (taxpayers, in other words: us), and now the banks are more solidly in control than they were before the supposed “regulations” that were to prevent the infinite greed. Strange how strong legislation DID prevent the banks from going bad for decades after 1929… but they now say only total freedom from regulation with “self-policing” will actually allow them to attain true capitalistic efficiency! Let ’em ALL go bankrupt!.

  15. Haha, sorry, but that doesn’t make any sense. If he magically changed the number, there still have to be buyers and sellers willing to trade at that price. He may slightly influence psychology by changing the number, but market participants would still have to agree to trade at that price. Unless he’s just claiming one price for one person and another price for another person. If he really wanted to scam greedy people, he should have just done what Pirate did and operate a businesses honestly for a year or two, and then when he has lots of people who have deposited with him, just instantly disappear with the money. But this alleged price manipulation is not the way to scam people well, and it’s also not nearly as effective as you seem to think it is. People still have to be willing to trade at whatever price he sets and he he sets it outside of what they are willing to trade around, then they stop trading, he stops getting his fee, and he loses money. It’s actually MORE valuable for him to simply put the price at whatever the market likes the most, so he generates more trades between people and collects more fees. That could even entail lowering the price. The price doesn’t matter to the exchanger if they’re collecting fees in USD.

  16. Thanks for this insight, I agree with your sentiment. The goal of any bitcoin exchange platform should be to self-regulate with transparency and auditability. The layer that changes the fiat into bitcoin and vice-versa is where the fiat-specific regulatory bodies interface into the exchange platform. The point is to decentralize, the “money changers” can’t be just controlled by one person, i should be able to change my money through myself. If i decide to trust someone else to change my money I want to know they’re legit. Right now it is clear that the current money changers are NOT in fact legit and the regulators take a blind eye to such activity as soon as it’s a money changer with influence, further propping up the current version of the global fiat ponzi scheme and protecting the perpetrators. So is there a gap, yes, and someone with more legal and technical skills than my own needs to step up and provide that robust cryptographic exchange platform.S.

  17. Albeit since anyone can basically just open an exchange, it is a possibility, such confession from an “exchange owner” could very well be sent by a detractor/made up. (Not that I would be surprised with the amount of bad services surfacing.) I’d certainly wonder what the name of the exchange is.

    However, I notice a lot of comment decrying pyramid scheme (ex: one pays $100 to become a member then refer new members who also pay the $100, collecting $50 on each referred members, while the person in control of the scheme just amass $50 for every signup for nothing) when it is an issue of hype and hysteria, and clueless buyers, forming a disproportionate speculative bubble by overbuying something (sort of like a tulip mania, buying tulip bulbs at a price far beyond their worth). Bitcoin is after all neither controlled by a unique person nor does it benefit more members nor does it need such crazily ever increasing prices. It could suffice itself being left alone in it’s dark corner of the web being traded at a small stable price between a few anonymous users.

    To note that Bitcoin was at first an experiment, a prototype, never intended to be actually used commercially, but which was quickly adopted anyway. And the average person, clueless about the place of cryptocurrencies in the future, just going around dumping massive amounts of cash at something without any idea of the true value of the thing. Which creates massive gains for some and losses for other as people start to realize maybe it’s silly to just dump so much money on something not yet used widely at all. Bitcoin will probably survive, just like it did the last bubble, but prices will definitely keep going down for a while.

    And to all those who see something valuating rapidly: maybe dumping all your funds on something which keeps valuating rapidly is not the wisest decisions, especially when everyone does it, but without any reason for it other than the fact it’s going up fast. Perhaps that could mean there is no valid reason for such a massive increase in price, doesn’t it?.

  18. Currently our national deficit is greater than our gross national product… Meaning that our dollar is worthless. It has no actual value, it only “has value” because ALL currencies our based on our dollar. If the dollar becomes worthless, ALL currencies will become worthless, at least until they work something else out. The world will soon flop back to old times of bartering, create a new currency, or just keep granting currencies fake value.

    Everything in the world only has value if it is wanted. Bitcoin is like Wall-Street which determines values of goods in countries. Which is a terrible way of doing things, it allows for bankers and fat cats to control global prices of everything. With Bitcoin at least the value is commonly related to difficulty levels of getting the coins.
    The big companies who make the ASIC miners could pose a threat by controlling the majority of bitcoins and then controlling the market for them.

    Ummmm, what else…. Even bars accept Bitcoin now and it is ruled an official currency by the US supreme court. Maybe the government is mining now?? Ha who knows. Bitcoin so long as it gains in popularity, which it is, will always be valued and will always increase in value until it hits it becomes so costly that no-one will use it anymore.

    This Oct. I will be spending $2k on a 400GH/s miner, that should be able to pay itself off in 4 days.

    Those of you interested check out KnCMiner and don’t buy Avalon because they have been controlling and abttting the mining market.

  19. Nobody running an exchange would use the phrase “Sometimes I let the files do this.”.

  20. The BitCoin is a bartering tool, no different than any other bartering tool before it.
    As long as people use the BitCoins, the BitCoins will have value.
    And the value of the BitCoin is as much as the people involved in the transaction agree on. The BitCoin sounds like a success to me….

  21. Back to the history, the guy could be manipulating the offer book indeed, but it has two ways and the seller force wouldn’t be strong after a while. And if the majority of bitcoins is used for money laundry, crimes and blah as stated, this would be easily detected with a single transaction, since A is paying $1,05 for the bitcoin and B is receiving only $1,00. The point is, it’s not only increasing the value of the book offer that increases the BTC value, outside this exchange BTCs had different values. This exchange was indeed described a selfscam, a pyramid, that’s why the exchange services must be legalized worldwide and audit, pay taxes, in order to avoid such crimes.

    But that’s silly to believe that only legislation will prevent fraud and manipulation to happen; we see everyday on the stock market, with derivatives, with central bankings, etc.

  22. Screw manipulating chart formulas– if I had a huge amount of bitcoins, and the price was 200usd/btc, Id set a buy order at 240 and sell the coins to myself at the same price. Id get my other bitcoin buddies to do it too. The transaction fee discount for trading large volumes makes trading with myself worth it in order to drive up the price. Wanna know why Id be able to get away with this? Because, as the author has stated, bitcoins exchanges are as anonymous and unregulated as the design of bitcoin as a currency system itself.

    And yes, I am jealous because I didnt know about bitcoin sooner. I am as selfish and conniving as the rest of you so called bitcoin enthusiasts preying on hopeful retards who hear about bitcoin and think of it as the answer to all the monetary problems they hear about on the news.

  23. Do you feel foolish yet?.

    • Consider this: for every Bitcoin you’re buying, someone else is selling.

      • BitCoin is selling for abou00 bucks today.

        • Oh, so you sold your Bitcoins into dollars? Or are you just reading the ticker tape?

          During the startup crash/ dotcom bubble in 2000 we called it paper money. Everyone thouht they were millionaires until they woke up one day and realised it was all just a number, until you cash out.

          Bitcoin is a token of exchange, with little value in itself, and a price governed by majority rule. The evidence still points to Bitcoin being deflationary, meaning everyone will buy and hold. Meaning any Bitcoin economy would slow to 0 spend.

          Only an inflationary currency like the dollar encourage commerce like we are used to.

      • So, just like gold then.

  24. The scaries thing of this all is that yesterday i heard something on the news about it in the Netherlands..

    Just a wild thought..

    Do you think that the bit coin is introduced to replace real money (money that’s supported by gold.) for worthless money. I know the dollar is used a lot and we all know that the dollar doens’t have value at all because they create money from nothing. Is this a way for the dollar to survive without going completely bankrupt? Without losing stocks or companies?

    Would like to know what you think about it.

    Greetings from the Netherlands.

  25. Do you feel foolish yet?.

  26. Compared to other online transaction systems like Paypal, bitcoin uses p2p
    which eliminates the need for a third party to complete the transaction.
    The Currency investing market place is the biggest market place in the
    planet, buying and selling very carefully can fetch you extra revenue
    than from any other organization or stock industry.
    Bitcoin has garnished a lot of attention in the recent past but before you
    jump on the train educate yourself first.

    Bitcoins.

    • Whoa Whoa Whoa, please tell me what backs bitcoins?
      A lame hacker who created this myth out of thin air that these bitcoins will one day be the future of currency and he can rule the world with 21 mil. Bitcoins (which are going to be produced in the lifetime).
      As lame as it sounds, morons fell for it.

  27. It’s interesting to see people comment on crypto-currency that don’t know the first thing about it.

    When you say it’s a pyramid scheme, please define that phrase because, that only works in a centralized banking schema, like what the physical world currencies and credit is based on.

    All the crypto-currencies are decentralized. Now, if you take a look at what this guy did, if he really did it, you need to post this person’s name and contact information to verify, along with the timestamp (IP address, time of which this came in, etc).

    Now, this guy, changed the exchange rate on his own website, that doesn’t change the value of the Bitcoin over the entire network, he was just fooling people on his website via some scripting to give faulty / false numbers to spur people to invest more money. That speaks more of a highly localized ponzi and bait n’ switch scheme, not a pyramid scheme.

    Now, I will address those who are supposedly ducking taxes, sooner or later you still pay taxes whether it’s directly when you exchange it for physical money for which you need to “legally” do your taxes and report it. Or, you pay taxes on the power bill you rack up (you pay the big power bill too) from doing the crypto-currency mining.

    Crypto-currency was designed to give people an alternative to a centralized debt driven currency for one that was created for the people without debt. What’s wrong with that?

    Oh wait, the age old oppressor doesn’t get it’s cut, that’s what wrong.

    Now, the physical monetary markets are not backed up by precious metals anymore, it’s based on credit, stored as ones and zeros in database not unlike crypto-currency, the difference is that it’s centralized and it’s assumed to be completely infallible for which we have already figured out not to be true.

    Here is something to think about, the USD, United States Dollar, the Secret Service, coins and prints money. That’s strange enough as it is. They also protect the President and other officials in high political office. That’s not so strange. Having the two together, printing and coining money and also having political clout because they supposedly protect these people is a blatant conflict of interest for the country of the United States. Notice I didn’t say “nation”, nation or national is the politicized version of “country”.

    When you see the phase, “National Security” it’s not “Country Security”, it’s security for the machine but not the people at large. The Secret Service protects the currency that the “machine” uses to enslave people into a debt driven society.

    Every “nation” does this, not just the USA.

    I want you to look up the phrase, “Fractional Reserve Banking” for which the nations and the banks that use this to essentially create money out of thin air. Now this screams scam, however, since the government and banks do it, it’s a “legal” scam.

    It works like this, we put a centralized virtual currency (credit) from USD or some other currency in the world) into a decentralized virtual currency (crypto-currency), sure there will be scammers and greedy folks, criminals if you will but there are a lot of honest folks out there too looking for another way to make ends meet.

    Now, I have started mining Bitcoin, Litecoin and Mincoin, I took my coins to various exchanges, I noticed that the value is higher on some than others, mainly because there is more activity on there, if it too high or too low I avoid those exchanges, based on hype is never a good thing. I went with a more normalized exchange, I waited 200 confirms, the balanced showed, up when I loaded my account with my money from my wallet, the exchange said it would take another 200 confirms to transfer the money and wait at the time 48 hours. I waited 48 hours but realized it was already transferred and finalized in 12.

    So, yes, I did get my pay out based on the actual the less transaction fees and transaction rewards, that was my first transaction, it was less then 500 dollars and was optional to report in taxes. I reported in taxes anyhow to prove I wasn’t hiding anything, it’s was minimal taxation anyhow.

    I have been withdrawing funds slowly from Bitcoin and Litecoin and occasionally on Mincoin, I often times just trade for Litecoin or Bitcoin depending on what looks good at the time.

    The one thing I have to explain is this, wallet encryption is a must and don’t trading outside the exchanges unless you know and trust the people or company in real life, that’s goes without saying. Use common sense, oh wait, that’s not common despite the name.

    The one thing about the crypto-currencies is this, you don’t truly lose your money in that if you don’t get nailed by a phisher tricking you into giving out your credentials or cracker (breaks your password and steals your coins). In the stock market, you lose there, you lose your money altogether, it’s gone, can’t do anything about it unless you can prove the broker is committing fraud.

    In your wallet, if you bought 10 BTC and it’s sitting there, and you buy it at 100 USD a coin, or 1,000 USD total, it drops to 4 USD a coin, you haven’t technically lost your money, it’s still in your wallet. The values dropped but you didn’t “lose” the Bitcoin. You wait for the market to rebound and figure in what the rewards would be in addition to what you want to sell it for.

    People have a knee-jerk reaction to when something is devalued in virtual currency but you have to remember, that for as long as they exist that have the probability to gain in value again. The coin’s value is based on supply and demand, also unfortunately based on the outside USD and other currencies as well, if the value outside takes a hit, so too does the virtual currencies to some extent, because less people are investing in it and the more people cash out. It’s just statistical probability, economics and psychology at work here.