Wednesday, December 18, 2013

Bitcoin Regulatory Crackdown Coming in Denmark

The spread of Bitcoin is now prompting regulators in Scandinavia to draft new rules in an effort to prevent virtual money from slipping into a legal gray zone, reports Bloomberg.

The most likely outcome would be an “amendment to existing financial legislation so that we have regulation covering it,” Michael Landberg, chief legal adviser at the Financial Supervisory Authority in Denmark, said yesterday in a phone interview. “It is also important to have this included in money laundering acts.”

Note the emphasis on money laundering that suggests to me a prohibition of tumblers that attempt to create anonymous Bitcoin use.

What has gone in China, Norway, and apparently soon in Denmark, will ultimately occur in the US if the USG deems Bitcoin a threat, though it may collapse of its own faulty structure before that occurs.


  1. The interesting thing here is what is the precise nature of this "threat". Clearly they do not think of Bitcoin as a threat in terms of a Ponzi fraud to the citizens of Denmark. No, this is a threat to their control over people's money. Implicit in this is the understanding that Bitcoin does exactly what its developers and boosters claim that it does. Which means that Wenzel is wrong to call it a a scam of any kind.

    Now the question that is begged is why a "Libertarian" would be against Bitcoin, which is such a clear threat to the state that before it even gains widespread acceptance, the State is moving to constrain or ban it altogether.

    1. Its like you bitcoin fanatics all grouped together to form a specific strawman to bring down

      1) Wenzel has called it a pump and dump - not a ponzi or a fraud, per se. He believes it doesn't provide anything uniquely useful and will be crushed by the weights of gov't so that only hardcore techies, if any, will use it ... every day joes walking down the street that don't know the fed from the treasury will not be using bitcoin

      2) libertarians can think bitcoin won't succeed in the same way libertarians can think using heroin is wrong ... no one here, including wenzel and north, are calling for coercive action against bitcoin or its users ... libertarians can be "against" bitcoin because they might not be fans of jumping in front of an on coming train

    2. Wenzel has explicitly said that Bitcoin is a fraud:

      "Like I said, it is a classic pump and dump scheme. The pumpers control the overwhelming number of active bitcoins and they are now in the distribution phase.They are laying their bitcoins off during all the excitement that they have behind the scenes created." EPJ Dec 11, 2013

      There are other instances of this sort of nonsense, and you can use Google to find them, and he has published several posts saying that Bitcoin is a Ponzi scheme. You are simply wrong in your first assertion, as anyone can check in 5 minutes.

      Wenzel is saying that it is a worthless tool or item that has no value, other than as a speculation. This is clearly false, to anyone who understands how Bitcoin works.

      He says that only "hard core techies" will use it. This is the same sort of nonsense that was said about the very internet that he posts his articles on. At first it was hard to use, and then it became spectacularly easy as it grew and new tools to use it were developed. The same is true of Bitcoin as it was of the early internet and the tools that are used on it, like the browser you use to read Wenzel.

      He claims "every day joes" walking down the street wont use Bitcoin. These are the same every day joes that all use mobile phones and send emails and SMSes from those phones while on the bus to their every day joe factory jobs. Statements like this betray a profound blind spot when it comes to how technology spreads and reduces in cost and increases in ease of use. Wenzel is ignorant of all of this, which is why he cannot predict the true future of Bitcoin.

      A libertarian does not cheer for the efforts of Libertarians to fail; the creators of Bitcoin are explicitly anti-Fed, and this is encoded into the Bitcoin Blockchain, where a portrait of Bernanke sits as a testament to the hatred of the Fed of the men who wrote Bitcoin. Certainly he is free to say whatever he wants. I am simply saying that is glee at every minor hiccup that Bitcoin services have, and his schadenfreude at the thought that the State is going to "crack down" and harm people who want to use it, is not only anti Libertarian, but is utterly disgusting and vile.

      Wenzel and North are not calling for coercive action against Bitcoin or its users, but by spreading lies about Bitcoin, refusing to even try it themselves and they are acting against their own interests like deluded members of a bizarre cult. They are ignorant of internet history, are computer illiterates, irrationally hostile to new ideas and are not humble.

      Ron Paul is a good example of the proper approach to new ideas. He admits that he doesn't fully understand Bitcoin, but that if it succeeds and kills the fed, that is a good thing, and he wishes the people who are building businesses around it luck. Lew Rockwell has made Bitcoin usable at, and Jeffrey Tucker also takes a rational view of it, after taking the time to actually use it and think about it. These are the acts of admirable men, not shrill, irrational, self immolating cultists like Wenzel and North.

      The difference in these two camps is the subtle difference between people who can think, true intellectuals, and people who are possessed of a good memory, and who have simply spent time memorizing the facts of their religion so that they can become "experts" in that field. They have no insight, no flexibility, and no imagination. All they can do is repeat ver batim the tenets of the people whose work they have memorized. They cannot come up with anything on their own, and cannot apply what they know to new tools and circumstances.

      This is the problem; it is a toxic mixture of the generation gap, computer illiteracy and cult fanaticism that stops Wenzel and North from looking at Bitcoin objectively. The future is already here for them; everyone is going to move onto Bitcoin and abandon credit cards, international transfers and all other functions to which Bitcoin can be put. So will Wenzel and North.

      They have already lost this debate.

    3. There is a big difference between a pump and dump scheme and a fraud, very often the officials involved with a company have no complicity with a pump and dump going on, the same holds true for most involved with Bitcoin.

      Your analysis gets worse from there.

    4. @Anonymous December 18, 2013 at 7:39 PM

      Well said.

  2. @Anonymous December 18, 2013 at 7:39 PM

    Awesome analysis! Wenzel and North have been totally, willfully blind to the significance of this new paradigm.

  3. I think it's all you pro-shitcoiners that are blind. especially with what is staring you right in the damn face. shitcoins was a nice experiment. next. I'll stick with gold.