Senators call for crackdown on ‘Bitcoin’ as drug traffickers move in

[Playinghardball]

Source: Raw Story
By Stephen C. Webster

The Internet barter system known as "Bitcoin," which makes it difficult for law enforcement to monitor online transactions, has raised the ire of two U.S. Senators who learned recently about a new website that lets Bitcoin users buy and sell illegal drugs.

In a letter to Attorney General Eric Holder and Drug Enforcement Agency (DEA) administrator Michele Leonhart, Sens. Charles Schumer (D-NY) and Joe Manchin (D-W.Va) called for action against the website "Silk Road," which was the subject of a recent report by Gawker.

Silk Road lets buyers and sellers of illegal drugs exchange Bitcoins to complete transactions, and the seller ships their product by mail. Because of how Bitcoins are designed -- as a peer-to-peer, decentralized substitute for real currency -- both the buyer and seller are protected from scrutiny. Users simply purchase the coins, log on and place their orders.

An added wrinkle: the Silk Road site is only accessible to users on the "Tor" network, which funnels traffic through dozens of other computers and protects the user's identity.

More at: http://www.rawstory.com/rs/2011/06/09/senators-call-for-crackdown-on-bitcoin-as-drug-traffickers-take-hold/

[MineralMan]

1. They should switch to LinuxBux - the Internet Currency You

Mint Yourself. Need More LinuxBux? Design Your Own with our Open Source BuxMinter application! Never be Broke Again!

[TwistedF8-]

2. Silkroad is gone now, plus, we all should use TOR

The real issue isn't the drugs no no no don't be stupid! its the fact that it subverts the banks and it is literally from me to you.

These drug sites are bait, to build up negative support against Bitcoin and us controling of our own money.

that's the real problem.

http://www.weusecoins.com/


http://www.youtube.com/watch?v=DVqybHkDI0k

[Arctic Dave]

4. +1

The banks and the gov will never allow this to spread. How dare we cut them out of "their" profits by using their cards.

[Odin2005]

12. Yup.

It's the same excuse they give to us want to eventually force us to stop using hard cash and only use debit cards, "to stop illegal drugs".

[bemildred]

3. A new form of Whack-a-Mole.

Maybe they should outlaw cash, I've heard drug dealers sell for cash too.

[saras]

6. They're working on it...

[Lionessa]

5. Wow, the timing of seeing this is sort of cool...

I finally have been granted my bankruptcy, so I can begin to move somewhere else. I'll be essentially homeless when I get there, but I have a skill and some equipment, and intend on getting on my feet pretty quickly. I just have no incentive to succeed in the regressive, ridiculous, red state...Idaho.

At any rate, I've never even heard of bitcoins, but I'm getting the edu right now. Looks like something I should definitely incorporate into my business plan.

Thanks!

[sofa king]

7. My primary gripe with it:

Bitcoin works on the principle that the solution to a random mathematical puzzle has some imaginary net worth, but what it really represents is thousands and thousands of hours of lost computing time.

This is not good, because there are already hundreds of distributed computing programs that work in more or less the same way, but which create useful information, for example by calculating how proteins fold in the presence of water molecules.

What that means to me is that the Bitcoin folks have the opportunity to assign a value to distributed computing projects, but they have instead chosen to compete with them. That's a shame, because we were on the verge of being able to reward people who donate spare computing cycles to projects which improve the lot of humanity. But because this currency does not represent useful work, it will be easy to kill off, and may doom distributed computing as well.

[Lionessa]

8. The people who would be using things like Bitcoins and Tor

are not likely the computer sharing types.

Secondly if you get an edu as I did yesterday, it isn't imaginary net worth. It does seem to be fluid, like owning stocks, so when to buy and when to sell could make a huge difference in your net worth.

Because of that, I think it would be very difficult to run any type of real business with it because how would you price, daily depending on the exchange rate??? I don't know, as I've delved deeper I'm less sure it will work for me, but I think you're barking in the wrong direction with your primary concern.

[sofa king]

10. Well, first of all...

Distributed computing is not "computer sharing." It is using your computer(s) spare cycles to calculate parts of difficult mathematical problems that require more time and money than a single computer (and research team) can handle. It is functionally identical to bitcoin, and therefore attracts the exact same kinds of people: people who are clever enough to maximize the output their computers can handle.

Second, it most certainly is imaginary net worth, as imaginary as is that picture of George Washington in your pocket. My complaint is that this imaginary worth is more imaginary than most, because while people are out there using the distributed computing process to create actual worth, and not being compensated for it, these people are using the same process to run a computer in circles for a result of no actual worth. I'll further bet that bitcoin results are not verified as carefully as distributed computing results are, making bitcoin a prime target for counterfeiting.

I really hope that the SETI, Prime95, and Folding@home folks (DU has its own folding team) tune into this and begin offering their own "coin" for completed results. If all it takes is people to agree upon its value, then a folding coin should automatically be recognized as being of a higher value than bitcoin, because the "answer" which earned the coin has actual value.

[paparush]

9. No bankers went to jail for stealing 21 trillion ...

and the gov really wants to hunt down peaceful bitcoin users because of 1 website ? sad....

[Odin2005]

11. Sounds like an excuse to crack down on people subverting the Banksters.