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Bitcoin Donations To US Campaigns Might Soon Be Allowed

timothy posted about 8 months ago | from the non-denominational dept.

Bitcoin 144

SonicSpike writes with this excerpt from Politico: "Political campaigns will be allowed to accept — but not spend — the digital currency Bitcoin, under a proposed federal rule released Thursday. The Federal Election Commission draft would require campaigns to first convert any Bitcoins collected as donation to dollars. According to the proposal, the currency will count as an 'in-kind' contribution to a campaign — like a stock or bond. The FEC will not consider them currency. Campaigns are permitted to accept non-monetary contributions like stocks, private stocks, commodities, and equipment— but must list their value in dollars on campaign finance reports. Attorneys for Conservative Action Fund PAC asked the agency in September to decide if and how political candidates and outside groups are allowed to use the digital currency, in addition to U.S. dollars. "

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144 comments

EVEN CRIMINALS HAVE FIRST AMENDMENT RIGHTS !! (-1)

Anonymous Coward | about 8 months ago | (#45376263)

It is the law !!

Re:EVEN CRIMINALS HAVE FIRST AMENDMENT RIGHTS !! (2)

TheCarp (96830) | about 8 months ago | (#45376859)

Yup, and now they want donations for it too.

Well... (3, Insightful)

Anonymous Coward | about 8 months ago | (#45376265)

Good. But still bad. Great for Bitcoins. A big shame that donations are allowed at all.

Re:Well... (0)

Joining Yet Again (2992179) | about 8 months ago | (#45376269)

So you think that only people who are already rich should run for office?

Re:Well... (1)

Anonymous Coward | about 8 months ago | (#45376305)

news flash dumbass... 99% of government is governed by the rich. The one with the most money wins most the time. Get money out of politics.

Re:Well... (1)

Joining Yet Again (2992179) | about 8 months ago | (#45376317)

Do we also restrain speech because everything is politics and freedom of the press belongs to the owners of the presses?

Re:Well... (2)

Cryacin (657549) | about 8 months ago | (#45376329)

At least it won't be the first time that bitcoins are used for murder.

Re:Well... (1)

Joining Yet Again (2992179) | about 8 months ago | (#45376357)

The only thing bitcoins have going for them is that nobody's bothered to regulate them properly yet.

Apart from that, they're something way less convenient than pretty much any first world currency or precious metal.

Re:Well... (2)

killkillkill (884238) | about 8 months ago | (#45376553)

Less convenient than fiat, of course, fiat has had an infrastructure being built around if for quite some time. If bitcoin continues to hold it's own eventually there will me more convenient ways to use it. Less convenient than gold or silver? I can't think of one way that is true.

Re:Well... (2, Insightful)

Joining Yet Again (2992179) | about 8 months ago | (#45376587)

Gold ownership doesn't mean having to carry around the gold, just having some evidence that you own it.

And if you lose that evidence, well, at least there's a record elsewhere to confirm it.

You lose your bitcoin, and it's lost.

Re: Well... (0)

Anonymous Coward | about 8 months ago | (#45376813)

This is.. Just totally incorrect.

Loosing your wallet private keys would be the equivalent to you identification. Without it, the public ledger that anyone in the world can use to prove your exact holdings is impossible.

Without your identification, you also cant cash in any gold bonds.

If you wanted to "keep your bitcoins safe" you could export the private key of a wallet holding them out on paper and put it in a safe deposit box. The unique benefit here would be that UNLIKE gold, you can store multiple copies of the key wherever you want. (Try keeping multiple copies of your gold! :D)

Unlike "real identification: you're not allowed to "get it back" once you lose it for one simple reason: you can generate new private keys at will! Try asking your government for a second (or N'th) identity.

Gold is a useless investment. Keep in mind that gold HARDLY changed in value over time, it's other currency that drops in value against it. Id love to imagine that some time in my lifetime we use the last of all the gold for equipment production, and we all realise how dumb the entire "gold trade" is. (Note: the majority of traded gold bonds dont have sufficient backing to honor them. Its been this way for a LONG time)

Re: Well... (1)

Joining Yet Again (2992179) | about 8 months ago | (#45376913)

Unlike "real identification: you're not allowed to "get it back" once you lose it for one simple reason

So, when you say "totally incorrect", you mean "totally incorrect except for this little caveat which makes it totally correct".

Re:Well... (1)

tompaulco (629533) | about 8 months ago | (#45376815)

At least it won't be the first time that bitcoins are used for murder.

Can you go ahead and rattle off a couple of examples of bitcoin being used for murder? Oh, and the silk road thing doesn't count, because nobody was actually murdered.

Re:Well... (0)

Anonymous Coward | about 8 months ago | (#45376381)

In 99% of the world ellection campaigns are financed by tax and distributed based on the number of seats held by the party, not donations.

Re:Well... (2)

Joining Yet Again (2992179) | about 8 months ago | (#45376389)

Not 99% at all, but do you understand how that method consolidates existing power?

Re:Well... (1)

TheRaven64 (641858) | about 8 months ago | (#45376401)

Depends on the entry requirements. If anyone who can get, say, 500 signatures from a district is eligible for the same funding, then there isn't much of a barrier to entry for any candidate who stands even the vaguest chance of winning. In the UK, candidates must pay a deposit (£500, I think) and they get it returned if they get more than a certain (small, but nontrivial) percentage of the vote. The amount is small enough that if you start with any support it's easy to raise - the Pirate Party managed in a few places, although they lost the deposit in places where they only got a handful of votes.

Re:Well... (1)

Joining Yet Again (2992179) | about 8 months ago | (#45376409)

Paying the deposit doesn't get you campaign financing, lol. And loads of small parties lose most of their deposits - the deposit being nothing more than a way of limiting the number of people on the ballot paper to the usual suspects. We have no such thing as a write-in candidate in the UK, remember.

Re: Well... (0)

Anonymous Coward | about 8 months ago | (#45376895)

You seem to have misses how non-american systems work here.

Its not a deposit, 100% of the money you're allowed to spend comes from that tax input. If you win your campaign, you get access to more tax money.

Up here in Canada, you can't use any of your own money to campaign. You can accept donations, limited to $1000 per person contributions, and like mentioned you get a few milestones of "input tax" for reaching various levels of support.

I'm not defending Canada's system though, once elected you can sure accept political donations as much as you like, (though we don't issue tax credits after the first $1000 per person, and unlike the USA, corporations don't get a credit for donating!)

Most of the world uses similar structures. This limits* the rich from investing in large elaborate campaigns for who they want to win, and puts everyone on level ground for some sense of competition.

*there's often a board that scrutinizes all campaign spending to ensure that the party did NOT receive additional money without claiming where it came from. This being the case however, it's still up to people to honor the fact that they have to claim all their spending. Its easy enough to get a sign maker to invoice you for "10000 signs" and pur it on your expenses, then to silently pay another invoice for "printing, cutting, full color graphics, etc" and slide it on under personal spending. If it comes out that this happened, you generally get stripped of offi... Who am I kidding. Even here in Canada it generally only results in a fine. Over In Brittan, it gets you kicked out of office and discrased.

Re:Well... (1)

Ethereal1 (1374891) | about 8 months ago | (#45376891)

I could testify for this. But it really depends on how the whole electoral system works. Here in Argentina, the Electoral Committee will alocate funds for your party, should you pay the deposit and present your support in form of signatures, and that's it. Now, the big problem is, the funding is proportional to the power each party has, so in the end, a small party is always behind in votes and funding to a larger one. And larger parties benefit from having many smaller parties going at each other for a minimal share of votes. Voters fragmentation is just a bad as bipartidism. Back in the 2000's, many smaller parties united into the "Alianza", which ended up winning, yet their candidates weren't what people were expecting and it all ended badly due to mismanagement on their behalf, as well as all the inherited caos that was and will always be our government. So in the end, if the division of funding was equitative and/or limited to a few parties, say around 5, i guess there would always be a cleaner voice.

Re:Well... (0)

Anonymous Coward | about 8 months ago | (#45377079)

news flash dumbass... 99% of government is governed by the rich. The one with the most money wins most the time. Get money out of politics.

Excellent idea! Only Fox News and MSNBC should be allowed to spend money on politics, I mean, 'News'.

Re:Well... (1)

BringsApples (3418089) | about 8 months ago | (#45377225)

news flash dumbass... 100% of government is owned by the elite. The ones with the brownest noses win all of the time. Get the elite out of politics.

There, fixed that for ya.

Re:Well... (1)

Arancaytar (966377) | about 8 months ago | (#45376361)

Unlike now.

Re:Well... (2)

Joining Yet Again (2992179) | about 8 months ago | (#45376367)

Many successful political parties were created through the union movement in Europe.

That was just a bunch of working men and women throwing money into a pot.

It's not about the money, but the propaganda.

Re:Well... (1)

Opportunist (166417) | about 8 months ago | (#45376769)

No, but I don't consider a government-for-sale a good idea either.

I prefer the model our country has: Get more than 2% (IIRC) of the votes and get reimbursed by tax money for your campaign expenses. Not a perfect model either, but I prefer to pay my politicians myself instead of letting corporations do it.

Re:Well... (0)

Anonymous Coward | about 8 months ago | (#45377383)

I don't consider a government chosen by 3 TV news anchors a good idea either.

That is what you are wishing for by your comments. The old days where Walter Cronkite got to choose the next president by burying stories that might hurt his candidate and overblowing ones that would hurt his guy's opponent.

Re: Well... (1)

gmuslera (3436) | about 8 months ago | (#45377025)

So you think that is good that people can only get there owning favors to rich people?

Re: Well... (1)

TheSpoom (715771) | about 8 months ago | (#45377343)

False dichotomy. The government should provide public campaign financing with reasonable rules as to who can access the funds.

Imagine (0)

Anonymous Coward | about 8 months ago | (#45377171)

A big shame that politicians are allowed at all. (FTFY)

We live in a world where we can participate in practically any kind of decision-making... except for our own governance.

When you're ready to start fixing the source of the problem, come join the Metagov project in working on collaborative governance. [metagovernment.org]

only an (-1)

Anonymous Coward | about 8 months ago | (#45376289)

Obama knucklehead would try to get Bitcoin into FEC rules

Can we have a week without ... (-1, Troll)

dbIII (701233) | about 8 months ago | (#45376291)

Can we please have a week without another "it may be real money soon - honestly" story about this pyramid scheme?

Re:Can we have a week without ... (1, Insightful)

Joining Yet Again (2992179) | about 8 months ago | (#45376311)

This decision is pretty much, "It isn't real money, but something that enough chumps value."

Re:Can we have a week without ... (1)

Anonymous Coward | about 8 months ago | (#45376353)

The US dollar isn't real money either, and it hasn't been since the FDR regime.

Re:Can we have a week without ... (2)

Noughmad (1044096) | about 8 months ago | (#45376383)

Care to share your definition of "real money"? Money can only be something that people value above its production cost, which makes the existence of "real money" impossible.

Re:Can we have a week without ... (1)

Joining Yet Again (2992179) | about 8 months ago | (#45376393)

Sure: real money is any token which can be used to pay for all debts and nearly everything available on general sale. It is supported by systems to ensure it maintains a fairly stable value.

That's one simple, practical definition of money.

Re:Can we have a week without ... (1)

Noughmad (1044096) | about 8 months ago | (#45376443)

If I go to a general store, I can't pay with US dollars. Are they not real money?

Re:Can we have a week without ... (1)

Joining Yet Again (2992179) | about 8 months ago | (#45376473)

Is it, "What would be the response of a smartass who doesn't live in the US?"

Re:Can we have a week without ... (0)

Anonymous Coward | about 8 months ago | (#45376719)

He's being a smartass, true, but his point still stands. By your definition, any currency stops being "real money" as soon as you travel abroad.

Re:Can we have a week without ... (1)

Opportunist (166417) | about 8 months ago | (#45376789)

Money is anything that someone else values. Simple as that. As soon as I can exchange some goods or services for something I hold and that is not goods or services itself to be consumed and/or traded further, that something becomes money. Whether that's sheets of paper with funny heads printed on it, some shiny pebbles out of certain metals or whatever else, what matters is whether the one offering the good or service is willing to part with it in exchange for that money.

Re:Can we have a week without ... (1)

maxwell demon (590494) | about 8 months ago | (#45376941)

Money is anything that someone else values.

And there are definitely people who value bitcoins.

Re:Can we have a week without ... (1)

Joining Yet Again (2992179) | about 8 months ago | (#45376875)

I'm pretty sure US businesses and governments still accept the US dollar even if you're abroad.

Re:Can we have a week without ... (0)

Anonymous Coward | about 8 months ago | (#45376971)

Nope.
Try paining at mcdonalds with dollars in europe, or at an apple store for that matter.

Re:Can we have a week without ... (1)

Joining Yet Again (2992179) | about 8 months ago | (#45377101)

USD is probably not the best example, because a lot of foreign stores do accept it. The point is that you can buy nearly everything by type in USD, not everything by quantity in USD.

Re: Can we have a week without ... (0)

Anonymous Coward | about 8 months ago | (#45376905)

Exactly. At which point as long as an exchange exists to translate your "money" into "local currency accepted by the local government" anything is currency.

incorrect - been to 4 countries, spent US cash (1)

raymorris (2726007) | about 8 months ago | (#45376991)

Though the _most_common_ money in most countries is the local currency, I've been to four countries and never had any problem spending US dollars in any of them, including at supermarkets restaurants, and bars In one non-US country, sellers saw that I looked like an American and quoted prices in USD. I surprised one shop keeper when I paid in local currency. I had acquired a small amount of local currency but found out there was no need for it.

Re:Can we have a week without ... (0)

tompaulco (629533) | about 8 months ago | (#45376835)

There are many places in the United States that will not accept your dollars as payment.
Let's just admit that it is all a line drawing game. U.S Dollar is a currency that can be used for almost everything in the United States, and quite a lot of things in the rest of the world. Bitcoin is a currency that can be used for a lot of things in the United States and a lot of things throughout the rest of the world.

Re:Can we have a week without ... (1)

Joining Yet Again (2992179) | about 8 months ago | (#45376949)

Every definitions exercise is a line-drawing game, lol.

The important property here is that you can buy nearly everything on general sale with US dollars. You can't buy everything with US dollars everywhere, but that's not what matters.

Re:Can we have a week without ... (1)

Anonymous Coward | about 8 months ago | (#45377151)

There are many places in the United States that will not accept your dollars as payment.

That's an interesting claim. Care to back it up? See, the laws says that the US dollar shall be payment for all debts. To refuse dollars as payment means either declining payment for the debt or commiting a federal felony.

Re:Can we have a week without ... (2, Interesting)

TheRaven64 (641858) | about 8 months ago | (#45376429)

Real money is something that has a guarantee that it can be turned into goods or services in the future, backed by something that most people will trust. Examples of the guarantee include a bank that owns a lot of assets making a promise, a guarantee that a government will accept it in payment for taxes or will enforce your right to settle debts with it, or some commodity (historical examples include grain and precious metals) that is stored somewhere in an amount that makes a convincing argument that people who want the commodity can go to the backer and exchange their tokens for the commodity.

Bitcoin is backed by nothing. There is no large organisation (government or private) guaranteeing that they will accept it in exchange for goods, services, or relief from debt. There is no commodity store that you can go to and exchange bitcoins for some guaranteed amount of the commodity.

There are markets, but they are unlike traditional commodity markets because commodity markets have a mixture of traders (who either produce or consume the commodity being traded) and speculators (who bet that the value of the commodity will go up or down and make money when they guess right, and who provide extra liquidity that helps the market function). Bitcoin markets solely contain speculators and so are extremely volatile.

Re:Can we have a week without ... (1)

Joining Yet Again (2992179) | about 8 months ago | (#45376447)

Excellently summarised.

Re:Can we have a week without ... (1)

Anonymous Coward | about 8 months ago | (#45376691)

Both currencies are backed by exactly nothing.
If the US government would make guaranties about trading dollars for some amount of goods or service, it would be a guaranty agents inflation. Running a money press without adding goods or services is exactly the opposite.
But there is one big difference: Bitcoin is designed to make limitless money printing impossible, which sounds a whole lot better than a promise from some kind government. In fact, Bitcoin does not depend on any politician, anywhere in the world, which makes it ideal for world-wide trusted payments.

I agree that US dollars are (currently) accepted in more places than Bitcon, but the only reason for that is that US dollars are the main currency used to trade oil. Almost every US war has been about stopping the trading of oil in any other currency.
As soon as oil trading switches to Bitcoin, Bitcoin would become a very stable and well accepted currency, and the US dollar would be a very volatile currency, only used locally in the US.

Re:Can we have a week without ... (1)

Joining Yet Again (2992179) | about 8 months ago | (#45376705)

Jesus Christ, this is how scientologists really think.

Any government could change the algorithms to give itself the power to create new bitcoins. Sure, you can create a fork of bitcoin, just like people could have created a fork of the US dollar at the ending of the gold standard... but you know what almost everyone chose to continue using?

And if it were really true that all US wars are about the currency used to trade oil, the fuck do you think is going to happen to bitcoins the moment some oil speculator even has an idle daydream about trading in bitcoins?

Re:Can we have a week without ... (0)

Anonymous Coward | about 8 months ago | (#45376857)

Anybody, including governments can start using a different algorithm, but the resulting "bitcoins" would only work between people that are both using the changed algorithm. Even if they used the same Bitcoin name, it still would be a completely separate currency. So given the choice of two currencies, one running an unlimited money press, which do you think would be more popular?

The last time a country started trading oil in Euro's, the US invaded that country, but nothing happened to the Euro.

Re:Can we have a week without ... (1)

Joining Yet Again (2992179) | about 8 months ago | (#45376955)

Well, given that everyone continued using the US dollar at the ending of the gold standard, my bet will be that people are going to go for the currency that receives the support of the government they've elected.

Re:Can we have a week without ... (1)

Opportunist (166417) | about 8 months ago | (#45376807)

This is why I prefer the Euro over the Dollar. It is backed by a "real" economy, but instead of one government behind it that could go bonkers and do something radical, over a dozen governments hold their hands over it and it's very unlikely that they will ever agree on anything, let alone any radical change.

Re:Can we have a week without ... (0)

Anonymous Coward | about 8 months ago | (#45376937)

Unless it's backed by something physical, it's still worthless.

Re:Can we have a week without ... (0)

Anonymous Coward | about 8 months ago | (#45376753)

Other than being volatile, the bitcoin is better than the USD in every way. How about that?

Re:Can we have a week without ... (1)

Joining Yet Again (2992179) | about 8 months ago | (#45376775)

Ignoring its tendency to eat humans, the lion makes a much better pet than the chihuahua.

Re:Can we have a week without ... (1)

TheRaven64 (641858) | about 8 months ago | (#45376851)

Volatility is exactly the opposite of what you want in a currency. When you sell something, you want to know that the money that you get in return will have a certain approximate value when you spend it. If there's a small but predictable amount of inflation or deflation, then you can factor that in to the purchase. It's much harder to make rational purchasing decisions if the money in your pocket may be worth 50% more or 50% less tomorrow.

Re:Can we have a week without ... (1)

alexander_686 (957440) | about 8 months ago | (#45376909)

Mod parent up.

Money in generally defined as
        medium of exchange
          store of value
          unit of account.

As such it kind of passes the first test, but volatility kills bitcoin use for the other 2 requirements.

Re:Can we have a week without ... (1)

tompaulco (629533) | about 8 months ago | (#45376867)

Bitcoin is backed by the agreement of people that use bitcoin that it has a certain value. This value tends to change as more people use bitcoin, as there are only so many of them.
The U.S. Dollar is similarly backed by the agreement of the people that it has a certain value. However, that value may change because an outside authority has the power to print more of such money, thus diluting what your current money is worth. Therefore, the U.S. Dollar is an investment vehicle guaranteed to lose value over time in relation to any fixed commodity.
The government does not "back" the dollar at all. If you give them a dollar, they will give you nothing in return, but another dollar.

Re:Can we have a week without ... (1)

TheRaven64 (641858) | about 8 months ago | (#45377515)

Bitcoin is backed by the agreement of people that use bitcoin that it has a certain value. This value tends to change as more people use bitcoin, as there are only so many of them.

That is not backing. Backing requires responsibility. If all of the people who accept bitcoin today suddenly stop tomorrow, who will enforce their guarantee? No one has made legally binding promises to exchange Bitcoins for anything in the future.

The U.S. Dollar is similarly backed by the agreement of the people that it has a certain value. However, that value may change because an outside authority has the power to print more of such money, thus diluting what your current money is worth. Therefore, the U.S. Dollar is an investment vehicle guaranteed to lose value over time in relation to any fixed commodity.

The US Dollar is backed by two guarantees in US law, deriving from Constitution. One is that the US Government will accept them in payment for taxes. The other is that the US Government will, via its legal apparatus, allow any debts held between US citizens to be settled by US Dollars.

This is what gives the US Dollar its value. A large organisation (a government, with a big military) promises to accept them as payment. They can print more, but the rate at which they can do this is limited because they need to maintain the value of new treasury bonds. Since 1960, the rate of inflation of US Dollars has mostly stayed in the 3-5% range (two big peaks over 10%, in the mid '70s and early '80s) and so someone accepting US dollars can be fairly confident that if they spend them again in a few weeks they'll have approximately the same value and even if they keep them for a year or two without investing them they won't lose much.

In contrast, bitcoins can gain or lose 50% of their value overnight. This makes them irrelevant as a currency. How do I price my goods or services in bitcoins when the value is totally unpredictable? It's popular among speculators, because they can make a lot of money if they make good guesses, and the increasing number of speculators keeps driving the price up. If a better game comes out, the value of bitcoins will plummet. And the lower limit on their value is 0, because there is nothing backing them.

The government does not "back" the dollar at all. If you give them a dollar, they will give you nothing in return, but another dollar.

You appear not to understand the concept of backing a currency.

Re:Can we have a week without ... (1)

AthanasiusKircher (1333179) | about 8 months ago | (#45377571)

Bitcoin is backed by the agreement of people that use bitcoin that it has a certain value. This value tends to change as more people use bitcoin, as there are only so many of them.

The U.S. Dollar is similarly backed by the agreement of the people that it has a certain value. However, that value may change because an outside authority has the power to print more of such money

SCARCITY != VALUE

Say it with me: SCARCITY != VALUE

Yes, scarcity can be a component of value, but it is not a guarantee. I can go out into my back yard and start picking up random worthless rocks, build a little stand and try to sell them: "Genuine rocks from AthanasiusKircher's back yard! Only a few like them in the world!" Nobody will care.

I could even argue that "This rock is the ONLY ROCK WITH THIS EXACT SHAPE IN THE KNOWN UNIVERSE!!" That's probably true. If it looks pretty, maybe somebody would pay a $1 for it at some flea market. Otherwise, nobody cares about that fact that this rock is "one of a kind."

Spend some time watching those random shows that go looking for antiques, and you'll understand this. There are a lot of rare things in the world, and you'll often get somebody who's willing to pay something for an item that is sufficiently rare. But whether that person will pay $1, or $100, or $10,000 is really up to whether (1) that person really wants the thing that badly for a person collection, or (and much more likely) (2) that person is aware that there is a group of other people out there who would pay at least that much.

You remind me of a friend who said that I should go in with him and invest in case of some kind of scotch (liquor) that was a couple hundred dollars per bottle. It was very rare and rather old, so it's pretty unlikely that anyone would come out with a new giant stockpile somewhere. My friend was convinced that these bottles would only go up in value, and in a decade or two, we could sell them for many times what we bought them for.

Now, what my friend said could happen. There are rare old bottles of scotch that have sold for thousands of dollars. On the other hand, there are also rare old bottles of scotch that aren't worth much more than they were when they were first sold. It all depends on the whims of a very small group of collectors and rich drinkers.

What you say could happen too: Bitcoin's "value tends to change as more people use bitcoin, as there are only so many of them."

But right now the price of Bitcoins is being driven by speculators -- people who are all betting the same thing. It is therefore very volatile. Whether "more people" will gradually adopt it in more circumstances is based on a lot of factors. But even if people start to like the idea of Bitcoin, perhaps someone else will come up with some sort of "virtual currency" that has attributes and advantages which Bitcoin doesn't, and maybe everyone will flock to that instead.

There are items that more-or-less have inherent utility value (like food), and there are others that only have value built on convention (like most currencies). Bitcoin's scarcity will only help it have value IF enough people actually want it.

The government does not "back" the dollar at all. If you give them a dollar, they will give you nothing in return, but another dollar.

Well, the dollar does have one thing going for it that Bitcoin doesn't (and likely never will): the U.S. government requires payment of taxes in dollars. It therefore forces people to use that currency. If people need to pay taxes in dollars, they are likely to receive wages in dollars, and if people receive wages in dollars, they are likely to want to spend them elsewhere.

As long as the government can throw you in jail for failing to pay your taxes using their chosen currency, you'll be forced to use that currency. And if people are forced to use that currency in those transactions, it's very likely to maintain some value elsewhere in society. I'm not saying the dollar is stable for all time, but the taxation requirement is enough to balance many people's worries about the "power to print money" in the short term.

Bitcoin, on the other hand, has no such body compelling you to use Bitcoin or else go to jail. So, I think for now I'll keep using dollars....

Re:Can we have a week without ... (2)

spikesahead (111032) | about 8 months ago | (#45377315)

Backing is required for fiat currencies because they do not have any sort of built in scarcity other than what is enforced by the owner of the fiat. The promise is really to bust down my door with guns if I try to produce any US$ myself, thus creating an artificial scarcity of valuable pieces of basic paper and ink.

Bitcoin is not a fiat currency, it's closer to gold in that it has an actual scarcity, just like one day we'll run out of gold one day we'll run out of bitcoins and our option for expanding the supply will boil down to further subdividing the pool that remains. The backing is fundamentally mathematical in nature, just like gold's value as a currency is that it is very difficult to produce for ANYONE, but if I discover a gold mine in my back yard I can produce all the gold I want without worrying that someone will put me in jail for doing so.

The way the united states was weaned off the gold standard was to enforce fiat style rules on gold, treating ownership of gold the same way we treat counterfeiters, as if the act of owning gold was counterfeiting currency. They took the gold and provided fiat currency instead. It was not until the fiat US$ was firmly established that laws on gold ownership were relaxed.

Re:Can we have a week without ... (1)

TheRaven64 (641858) | about 8 months ago | (#45377463)

Backing is required for fiat currencies because they do not have any sort of built in scarcity other than what is enforced by the owner of the fiat.

Precious metal-based currencies are also backed by the promise that the person storing the metal for you will exchange the currency for some quantity of the metal.

Bitcoin is not a fiat currency, it's closer to gold in that it has an actual scarcity, just like one day we'll run out of gold one day we'll run out of bitcoins and our option for expanding the supply will boil down to further subdividing the pool that remains

Scarcity does not imply value. There are lots of things that are scarce, but have low value because no one wants them. You don't create value just because you have something that is scarce. Pieces of paper on which I have drawn a picture of a cock are scarce, but that doesn't make them valuable. I don't intend to create any more, and so now by your logic they should be more valuable than BitCoins. Want to give me $100 for one?

Re:Can we have a week without ... (1)

afxgrin (208686) | about 8 months ago | (#45377535)

Bitcoin is backed by the stakeholders - those who have invested money into mining and bitcoins. These people are citizens of a variety of countries, many of which offer legal rights for investments. The United States, being the very capitalist nation that it is, has many laws that protect its citizen's property. These citizens will be petitioning the government constantly through every legal avenue possible to insure their bitcoin holdings are not made illegal on a political whim. In Canada for example, the Canada Revenue Agency (Canadian IRS) are going to be passing out rules for reporting the income. It's capital gains once sold on the market, and in Canada that tax rate is quite high, however it is a legal avenue to cash out bitcoins.

There is an emerging marketplace for bitcoins, Baidu probably being the largest name to enter this market at the moment. This list [spendbitcoins.com] may seem trivial now, but there is enough momentum now that it will likely take off. All it needs is the blessing of a major US political party - and to do that just keep sending them BTC donations. They aren't going to make their own hoard of money illegal.

Re: Can we have a week without ... (1)

superwiz (655733) | about 8 months ago | (#45376485)

Universal acceptance is one of the requirements. If a token is only useful for enumerating some exchange but not others, than it's indistinguishable from grocery store coupons.

Re: Can we have a week without ... (1)

tompaulco (629533) | about 8 months ago | (#45376877)

Universal acceptance is one of the requirements. If a token is only useful for enumerating some exchange but not others, than it's indistinguishable from grocery store coupons.

So we are in agreement that there is no such thing as a currency.

Epic fail (1)

dbIII (701233) | about 8 months ago | (#45376557)

"My definition" does not matter and neither does yours. Look up a dictionary or ask an expert.

Re:Can we have a week without ... (0)

Anonymous Coward | about 8 months ago | (#45376451)

"something that enough chumps value"
sooo..., like USD, or gold.

Re:Can we have a week without ... (2)

Hognoxious (631665) | about 8 months ago | (#45376363)

With 3D printers you'll be able to make hours, days or any other unit of time at home, for free!

Re:Can we have a week without ... (3, Informative)

maxwell demon (590494) | about 8 months ago | (#45376993)

With 3D printers you'll be able to make hours, days or any other unit of time at home, for free!

I'm sorry to burst your bubble, but you need a 4D printer for that.

Re:Can we have a week without ... (2)

KiloByte (825081) | about 8 months ago | (#45376377)

Sorry to bear it to you, but your precious US dollar is not real money since 1934 when the US government defaulted. Any form of currency that can be devalued on a whim is make-believe: it lasts only as long as people believe in their government and banking system, and people are rapidly losing faith. Take a look at the public debt to GBP ratios: the debt spiral looks like there will be a collapse in no more than 10-20 years.

That's why people are so desperately looking at a currency that can't be spent at a deficit.

Re:Can we have a week without ... (0)

Anonymous Coward | about 8 months ago | (#45376435)

That would be nice indeed. We've had a wall of Bitcoin stories here over the past few weeks and all too many of them are ifs buts and maybes rather than news.

I guess its because there's a evangelical editor here excited by the market rate (which has been going parabolic even plotted on a log scale).

Re:Can we have a week without ... (0)

Anonymous Coward | about 8 months ago | (#45376449)

You look bitter. Given your Slashdot ID, I guess you were here in 2010 and you dismissed Bitcoin when you first heard about it [slashdot.org] . Now you realize that you would be retired if you had bought some then, at 0.05$/bitcoin.

Re:Can we have a week without ... (0)

Joining Yet Again (2992179) | about 8 months ago | (#45376479)

Yeah, everyone who fails to make bank off a scam is just bitter.

Boiler Room is also a good film.

Re:Can we have a week without ... (0)

dbIII (701233) | about 8 months ago | (#45376581)

Has it only been three years? I was sure this stupid scam had been commented on here for a lot longer than that.
With the huge number of stories these must be hundreds of comments which point out the problems by now. Funny thing is I don't remember seeing a story here about the theft of around a million dollars in bitcoins in Australia this week, I only saw that in the mainstream news. We only seem to see stories about bitcoin on this sight that put it in a positive light submitted by people that undoubtedly stand to profit if the pyramid keeps growing.

Re:Can we have a week without ... (1)

Joining Yet Again (2992179) | about 8 months ago | (#45376661)

But don't you see??? Bitcoins will deliver us from the evil of central banking!

All that has to happen is for everyone to agree to use and control them only in the ways the Bitcoin Founding Fathers claimed to intend.

THE PLAN IS FLAWLESS.

Re:Can we have a week without ... (1)

tompaulco (629533) | about 8 months ago | (#45377005)

So you posit that bitcoin is both a scam and a pyramid scheme. Very well.
If it is a scam, it must have victims. Please point out the victims of this scam.
If it is a pyramid scheme, then money is being taken from people who entered into the scheme late and being given to the people who entered into the scheme early. Please indicate who has recently had money taken from them to enter into this scheme, and who has been paid for entering into this scheme early.

Re:Can we have a week without ... (0)

Anonymous Coward | about 8 months ago | (#45377523)

The victims are the people who are left with worthless bitcoins when the price crashes.
The people who have money taken from them are the ones who buy into bitcoins.
The people who make money are the ones who cash out by selling their bitcoins before they crash.

It is a textbook Ponzi scheme except for the lack of a central distributor.

How hard is it to see that a scam is going on when people are making hundreds of thousands of dollars in paper gains from doing absolutely nothing? No work, no production, no investment. Just buy a bitcoin for $5 today and sell it for $10 tomorrow.
It's a painfully obvious money-for-nothing scheme, as evidenced by the fact that people are getting money for nothing.

Even counting drugs, the minuscule economic activity going on won't even cover the (ridiculous) cost of running the network, never mind the $3,500,000 and rising that some guy is allegedly owed for delivering a pizza once.

Limits and rally... (1)

deego (587575) | about 8 months ago | (#45376297)

"Because the value of the currency floats, campaigns will have to be careful not to accept donations above federal campaign contribution limits."

LOLOL. At the present rate of the amazing bitcoin rally in action ($100 rise in less than 2 days!), that seems like quite an INTERESTING problem to solve.

What if it's over the limits? Can they return the excess?

Re:Limits and rally... (1)

Sarius64 (880298) | about 8 months ago | (#45376371)

They'll probably just get zombies to float it into $20 and under anonymous donations, much like the last two national elections.

Dead People Have Donated Nearly $600K to Campaigns Since 2009 [motherjones.com]

Anonymous Donations Can Remain Secret Despite IRS Requirement to Disclose [bloomberg.com]

Re:Limits and rally... (0)

Anonymous Coward | about 8 months ago | (#45376701)

They could encrypt there wallet, and then loose the password. (but then the remaining Bitcoins would increase in value even more)

Equal Opportunity (5, Insightful)

Anonymous Coward | about 8 months ago | (#45376301)

Congress will take bribes from anyone.

Re:Equal Opportunity (1)

supremebob (574732) | about 8 months ago | (#45376797)

The good news is that now that the congresscritters will have Bitcoin of their own, so they'll have a vested interest in helping it become a legal and legitimate currency. That way, they can spend it on attack ads against their opponents in 2016 :)

Don't forget that there are still a lot of banksters out there who are still trying to outlaw Bitcoin transactions in the US, using sites like Silk Road as an example on why it shouldn't be adopted as a mainstream currency. The potential loss of credit card transaction fees if Bitcoin becomes popular is starting to become a big deal for big banks and their lobbyists.

Re:Equal Opportunity (1)

mark_reh (2015546) | about 8 months ago | (#45376951)

When consumer protection laws apply to bitcoins it may have a chance of becoming a viable alternative. I know that if someone screws with my Amex or Visa account, I will not be on the hook for more than $50. If someone steals my bitcoins I am screwed, period.

No thanks. I'll continue to take my chances on $US.

Re:Equal Opportunity (1)

sociocapitalist (2471722) | about 8 months ago | (#45377423)

Congress will take bribes from anyone.

Especially relatively untraceable anonymous bribes like bitcoin would be.

Fucking scumbags.

Missed the boat on Bitcoin (0)

Anonymous Coward | about 8 months ago | (#45376483)

Love reading the comments of nerds that missed the Bitcoin boat years ago.

Re:Missed the boat on Bitcoin (2)

Joining Yet Again (2992179) | about 8 months ago | (#45376491)

Or maybe the nerds saw the boat but decided not to ride it.

There's a word for people whose interest is making money without working, and it's not "nerd".

Re:Missed the boat on Bitcoin (1)

tompaulco (629533) | about 8 months ago | (#45376981)

So a person who makes money without working, and yet does not actually take the money from someone else, but merely is creating mathematically something that they and others value, is somehow evil?

Re:Missed the boat on Bitcoin (0)

Anonymous Coward | about 8 months ago | (#45377671)

I guess hashes with zeroes in front of them are kind of pretty, but I wouldn't pay 7000 dollars for one. Enjoy your negative-sum game.

So the politicians will be in good company (2)

mark_reh (2015546) | about 8 months ago | (#45376487)

with the likes of those who operate the silk road. "in-kind" contribution? Sounds about right to me.

Re:So the politicians will be in good company (1, Troll)

Joining Yet Again (2992179) | about 8 months ago | (#45376497)

Indeed. Bitcoin, like party politics, is enjoyed by people who are out of their mind and should be out of the question.

Re:So the politicians will be in good company (1)

TeknoHog (164938) | about 8 months ago | (#45377183)

Last time I checked, bitcoins don't have actual traces of cocaine, only figurative ones.

Yiuo fai7 it!? (-1)

Anonymous Coward | about 8 months ago | (#45376561)

and the Bazaar philosophies must and, after initial PARTS. THE CURRENT Be treated by your downward spiral. the system clean Purposes *BSD is for the state of our cause. Gay Exactly what you've the official GAY Backward and said Niigers everywhere STANDPOINT, I DON'T trouble. It If you do not there are only turd-suckingly People playing can Which don't use the my resignation COUNTERPART, Continues in a Very sick and its as one of the In jocks or chaps and financial Of a solid dose are inherently were nullified by may well remain Very own shitter,

Anonymous donations - corruption (0)

Anonymous Coward | about 8 months ago | (#45376567)

Doesn't Bitcoin allow for anonymous donations?

When you withdraw a lot of cash from a bank, people (like the Feds: DEA, DHS, IRS) take notice. So you fund Bitcoin overseas and meet with your polician of choice, make a deal and a LOT of Bitcoin appears in his account without a trace.

He then tells everyone that it's a grassroots fund raiser - just like Tea Party or Obama.

No surprises (1)

JockTroll (996521) | about 8 months ago | (#45376577)

If it can be pocketed by a politician, then it becomes legal.

No thanks (1)

TheCarp (96830) | about 8 months ago | (#45376847)

Wow, this may be one of the first bitcoin services I had no intention of ever using right out of the gate. I would feel better about.... paying for a murder directly than funding some asshat to go cause mass murders.

Re:No thanks (1)

VortexCortex (1117377) | about 8 months ago | (#45377739)

I would feel better about.... paying for a murder directly than funding some asshat to go cause mass murders.

I take it you don't pay your taxes then? Got WMD?

Remember Silk Road? (1)

Gary Perkins (1518751) | about 8 months ago | (#45377125)

I find it very interesting that this news comes after the FBI shut down Silk Road, and obtained a rather large wallet. Anyone hear any news of that wallet being decrypted? If not, anyone know who's working on it? In any case, I'll be watching to see who ends up with a rather large amount of bitcoin donations...

Re:Remember Silk Road? (1)

Jeff Flanagan (2981883) | about 8 months ago | (#45377513)

What's to decrypt? The government has the wallet, which just means that they have the private keys and can manage the bitcoins.
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