Posts Tagged ‘bitcoin’
The first Bitcoin ATM machine has launched for the first time in Israel, at a location in Tel Aviv.
Bitcoin, a new form of virtual currency, has recently begun to make the rounds of the global economy.
The new machine, operated by the Bits of Gold company, returns Bitcoin credit in a virtual wallet in exchange for a deposit of cold hard cash. The new ATM is located at the nonprofit Bitcoin emBassy organization offices.
The new currency appears to be creating an alternative underground world economy, independent from any other national system by virtue of the fact that it operates internationally, solely via the Internet.
In Israel, one Bitcoin (BTC) fluctuates around the NIS 1700 mark, according to the website of the Bits of Gold company. Users who prefer extra security are offered a USB key called a “Yubikey” by the company. For business owners, the company also offers a “checkout with Bitcoin” service.
The Bank of Israel is considering clamping down on the use of “bitcoins” with stiff regulations and warned the public on Wednesday to beware of possible fraudulent use of the virtual currency.
The bitcoin is a digital currency, but its value is determined by demand. It is worth about $635 today, but was valued at $1,000 late last year and as little as $150 this past September.
Bank of Israel Governor Karnit Flug issued her warning following the bitcoin’s popularity that has attracted several start-ups to allow the bitcoin to be used to buy everything from soup to shares on the stock market.
The bitcoin “is liable to be exploited for criminal activity, including money laundering, financing illegal activities and financing terrorism,” the Bank stated.
“It was agreed to continue to examine various perspectives related to the use of, and trade in, virtual currencies. These perspectives include possible macro effects, their legal standing, their regulation, money laundering and terror financing risks, taxation and consumer protection.”
The statement added, “It is emphasized that they [bitcoins] are also not legal tender of any country, and that the term used does not indicate any legal status as ‘currency.’”
It also pointed out that bitcoins, since they are only virtual currencies and are stored on smartphones or computers, are subject to robbery through hacking.
Regulators in the United States , Canada, the European Union and elsewhere, who have published similar warnings to the public.
However, all the warnings may be superfluous. Wired.com reported Wednesday that a computer glitch at Mt. Gox, once the world’s biggest bitcoin exchange, has scared bitcoin owners.
Mt. Gox said two weeks temporarily stopped allowing customers to withdraw bitcoins, stating that the glitch in bitcoin software affected it and another exchange. The result was a dive in the value of bitcoins at Mt. Gox although it has remained steady elsewhere.
Centralization in Israel is a two-headed coin (or perhaps a two-headed monster).
There’s no doubt, that so many bureaucratic activities go much smoother in Israel than they do in America, because we have ID numbers and our cards are inter-linked to everything. Of course, sometimes that doubles the frustration when obvious things need to be manually duplicated over and over for no reason.
On the other hand, that centralization provides no flexibility or a safety net. Having problems with one government office can easily spill over to an unrelated one, since you’re linked together everywhere on record.
Then there is the basic issue of personal privacy and civil liberties.
And now, the Israeli government is attempting to implement two extreme decisions that threaten civil liberties more than ever.
They’re testing a biometric ID system. God forbid that should ever become mandatory.
Right now, even though your personal bio-data is out there with different organizations, there is still some semblance of privacy and protection because of the separation that naturally exists between your health fund, the army, the government, and so on.
But once that goes away, there goes your privacy. You will have no control over your personal information at all, and you’re reliant on the government, which as we know, is not the most effective of protectors of personal data.
The other move is even scarier.
There was a unanimous cabinet decision to explore how to do that (Hey Naftali Bennett, I didn’t vote for you to lose my civil liberties – remember that come election time).
They want to get rid of cash, and give everyone rechargeable “cash cards” that will allow the government to track every single transaction you do. EVERY. SINGLE. TRANSACTION.
I can’t even begin to describe the civil liberties and privacy violations that implementing this system will create.
And if they actually believe this will get rid of cash, or the black market, they’re even stupider than I thought.
Bitcoin, gold, barter… you name it. Smart (and dumb) people will find their way around it. Not to do illegal transactions, mind you, but simply to protect their privacy away from the government’s snooping eyes.
And then we’ll all be criminals, because of a dangerous legislation which is an intrusive attempt to suck more tax money out of us and spy on us, and not just spy directly, but with data mining too, to study our purchase and transaction behavior, and find every last penny they can suck out of us and understand what we do with it.
I guarantee one thing. If this legislation passes, if the party I voted for, and the ones I didn’t, don’t stop this in its tracks, I will do everything (legal) to make sure those people do not get elected again, and be replaced with people who do care and understand the importance of civil liberties and fear the tyranny of government.