05 December 2015

Bitcoin in the News - June 2015

Is that right? This post is dated December 2015, but the title says, 'News - June 2015'. When I first got the idea to blog about bitcoin, I set up a Google News Alert to track the subject. That was at the end of May, when the first news reports didn't make much sense to me. With six months of bitcoin experience behind me, I thought it might be worthwhile to take a second look at the first full month of reports. Would they make more sense now?

Indeed they do. With 30+ days of alerts and Google reporting three bitcoin news items per alert (the alerts include other subjects that interest me), that's nearly 100 news reports to review. Most of the reports weren't particularly interesting -- price movements, scare stories, bitcoin is dead, that sort of thing -- but I short listed ~20 for further review.

The big news of that month was undoubtedly Bitcoin Rules Completed by New York Regulator (nytimes.com), reported by a number of sources. The NYT article started,

With just weeks to go before he steps down, Benjamin M. Lawsky, New York’s top financial regulator, on Wednesday released rules for running a Bitcoin business in the state. In a speech at the BITS Emerging Payments Forum in Washington, Mr. Lawsky announced the final set of rules that govern virtual-currency businesses, concluding a nearly two-year effort to regulate the growing Bitcoin industry. Mr. Lawsky said that the final form of the so-called BitLicense would put in place crucial guidelines for protecting consumers and preventing money laundering.

It doesn't take long to realize that, like oil and water, the ideas behind bitcoin and regulation don't mix well. Later the NYT article noted,

Throughout the process, some Bitcoin advocates have questioned whether Mr. Lawsky was overstepping his boundaries and proposing regulations that could throttle the nascent technology. Critics on the Internet site Reddit satirized the regulator by depicting him atop the Iron Throne from the HBO series “Game of Thrones” with the caption “Hail King Lawsky.”

Note the capitalization of 'Bitcoin' throughout. The full title and address (dfs.ny.gov) of the 44-page PDF is NEW YORK STATE DEPARTMENT OF FINANCIAL SERVICES; NEW YORK CODES, RULES AND REGULATIONS; TITLE 23. DEPARTMENT OF FINANCIAL SERVICES; CHAPTER I. REGULATIONS OF THE SUPERINTENDENT OF FINANCIAL SERVICES; PART 200. VIRTUAL CURRENCIES. I downloaded the file and set it aside for a rainy day.

Many of the items served by Google weren't news, but opinion. Sometimes it's hard to tell the difference, as in Bitcoin Rules Divide Wall Street's Digital Currency Community (ibtimes.com).

Bitcoin is facing a coming-of-age moment. The cybercurrency, beloved by techno-libertarians and notorious for financing the Web’s largest black market, will soon come under the formal purview of New York state financial regulators. That’s anathema to bitcoin diehards.

Wall Street is the financial district of New York, which is the financial capital of the USA, which is one of the economic engines of the world, so this story isn't disappearing anytime soon.

Did I really say that scare stories and 'bitcoin is dead' reports aren't particularly interesting? Maybe that's because there are so many of them; for example: Bitcoin isn’t the future of money - it’s either a Ponzi scheme or a pyramid scheme (washingtonpost.com), Lloyd's Report: Bitcoin Will Always Be Risky (coindesk.com), and Matt O'Brien: The scam called Bitcoin (nzherald.co.nz).

No wonder there's so much call for regulation. No one wants to sink hard-earned money into a scam. On the other, positive side of 'the coin', there's a concept of safe haven, as in Greeks are rushing to Bitcoin (money.cnn.com).

With bank doors slammed shut, frantic Greeks are turning to online trading platforms to see if the digital money Bitcoin is a better bet than the euro.

I could go on -- Bitcoin Will Be Money If It Becomes Boring (bloombergview.com), EBA: 51% Attack Remains Bitcoin’s Biggest Problem (coindesk.com), Blockchain Technology Will Transform the Practice of Law (bol.bna.com), and more -- but I'll save that for another time.

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