Monday, November 18, 2013

Homeland Security Hearing 18th November 2013 will be Bad News for Bitcoin

On the 18th of November at 8PM GMT+0, Homeland Security will hold the first of two hearings about Bitcoin and the future of cryptocurrency after Silkroad. I believe these hearings will have a negative impact on Bitcoin prices, and here's why.

The FBI probed for investigations into Bitcoin, following the statement: “Indeed, it is not clear at this point whether virtual currencies will become a long-term, prevalent fixture of the electronic commerce world. But given the increased demand from consumers and investors, as well as demonstrated concerns regarding money laundering, regulators would be remiss if they turned a blind eye to virtual currencies,” Mr. Lawsky said in Thursday’s announcement.


There are two panels for the meetings, on one side being Bitcoin representatives, and the other consisting of members from the United States government. They are:
  • Jennifer Shasky Calvery, director of the Financial Crimes Enforcement Network – US Department of the Treasury
  • Mythili Raman, acting assistant attorney general – Criminal Division US Department of Justice
  • Edward W. Lowery III, special agent in charge at the Criminal Investigative Division of the US Secret Service – US Department of Homeland Security

A little background search of these representatives gave these results:

Jennifer Shasky Calvery, director of the Financial Crimes Enforcement Network – US Department of the Treasury
“Digital currencies are just a financial service and those who deal in them are [financial institutions],” Jennifer Shasky Calvery, the director of the Financial Crimes Enforcement Network
FinCEN is dedicated to learning more about digital currency systems, along with other emerging mechanisms, to protect those systems from abuse and to aid law enforcement in ensuring that they are getting the leads and information they need to prosecute the criminal actors. 
Mythili Raman, acting assistant attorney general – Criminal Division US Department of Justice
announcing that he will hold hearings that could help determine whether virtual currency companies will need to apply for a special “bitlicense” to operate in the state.

Acting Assistant Attorney General Mythili Raman said: “As charged, Liberty Reserve operated, on an enormous scale, a digital currency system designed to provide cyber and other criminals with a way to launder their profits without leaving a trace. The company’s very purpose was to launder its users’ criminal proceeds through the U.S. and global financial system.



Edward W. Lowery III, special agent in charge at the Criminal Investigative Division of the US Secret Service – US Department of Homeland Security
Ed Lowery, special agent in charge of the U.S. Secret Service's criminal investigative division, said the agency is working "aggressively with our international partners" to pursue cyber crime and the companies that permit the misuse of digital currencies. He declined to comment specifically on Bitcoin.


The toughest comments came from the Department of Homeland Security. “The anonymity of cyberspace affords a unique opportunity for criminal organizations to launder huge sums of money undetected,” wrote DHS Acting Assistant Secretary for Legislative Affairs Brian de Vallance. “With the advent of virtual currencies and the ease with which financial transactions can be exploited by criminal organizations, DHS has recognized the need for an aggressive posture toward this evolving trend.”

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Keiser Report: Mud Pie of State Benefits (E523)

Jeff Berwick on Fox Business: Is Bitcoin the currency of the future?

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Could be a good time to sell tomorrow before the talks start. We could see prices back ab sub-300 or even sub-200 levels. Let's wait and see.

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