Greed and Capitalism

What kind of society isn't structured on greed? The problem of social organization is how to set up an arrangement under which greed will do the least harm; capitalism is that kind of a system.
- Milton Friedman

Wednesday, January 29, 2014

Bitcoin executive resigns amid money-laundering investigation





Charlie Shrem
Charlie Shrem, left, leaves the Manhattan Federal Courthouse in New York January 27, 2014. Photograph: Lucas Jackson /Reuters
 
 
 

Bitcoin executive resigns amid money-laundering investigation

  • Charlie Shrem, Bitcoin Foundation vice-president, resigns
  • Shrem accused of helping to launder money for Silk Road




The vice-president of the Bitcoin Foundation, which lobbies on behalf of the digital currency, has resigned amid allegations he helped launder money for Silk Road, the online drug bazaar.

Charlie Shrem, 24, who is one of the digital currency’s highest-profile faces, was arrested by US authorities at John F Kennedy airport in New York on Sunday as part of the ongoing investigation into Silk Road, a now-closed online store that allegedly dealt in drugs, guns and other contraband items.

The arrest came as a major blow to the Bitcoin Foundation, which has been lobbying for greater acceptance in Washington for the digital currency and testified before the Senate last year in an attempt to dispel the perception that the currency is linked to organized crime.

Shrem is also the chief executive officer of BitInstant, a Bitcoin exchange company that attracted investment from the Twins Cameron and Tyler Winklevoss, famous for their early involvement with Facebook and now two of Bitcoin’s biggest backers. 

BitInstant aims to widen Bitcoin ownership and allows people to buy the digital currency in over 700,000 locations.

Jon Matonis, the executive director of the Bitcoin Foundation, which is a non-profit organisation, said: “As a foundation, we need to remain focused on our core mission to standardize, protect, and promote the Bitcoin core protocol.  

While Charlie has contributed a great deal of personal effort and resources to enhance the adoption of Bitcoin worldwide, a prolonged legal dispute would inevitably detract from advancing that core mission.

"Therefore, in order to focus on his pending trial, it has been mutually decided that Charlie Shrem resign from the board of directors, effective immediately."

On Monday, Preet Bharara, the US attorney for the southern district of New York, alleged that Shrem helped Robert Faiella, who was charged alongside him, to sell more than $1m-worth of bitcoins to Silk Road customers. 
Faiella, a 52-year-old Florida man whom Shrem had never met, allegedly ran an underground Bitcoin exchange using the alias BTCKing.

In a blogpost, the Bitcoin Foundation pointed out that Bharara had said: “The charges contained in the complaint are merely accusations and the defendants are presumed innocent unless and until proven guilty."

It continued: “We are both surprised and saddened to learn of these allegations. The foundation does not condone illegal activities and values transparency, accountability and a high level of responsibility towards its members and overall community.

“It is also worth noting that the indictment itself is not against Bitcoin or the community at large. Indeed, the complaint acknowledges, ‘Bitcoin are not inherently illegal and have known legitimate uses’.”

“As a foundation, we will continue to work towards standardizing the technological infrastructure for widespread adoption, protect the integrity of the Bitcoin protocol, and promoting its social and economic benefits through public education.”








 Blog:
 https://bitcoinfoundation.org/blog/


 Link:  http://www.theguardian.com/technology/2014/jan/28/bitcoin-executive-resigns-money-laundering-silk-road-charlie-shrem



Bitcoin Go;ld Mine seized ny Federal Prosecutors

 
*This is a very strange form of currency that is valued by supply and demand.  It is not backed by the ability to tax the people of the country that issues the currency nor is it tied to gold or the currencies of trading partners.

Further, it has a very uncertain value with the US Marshals Service, which is
 in charge of liquidating such seized assets, sitting on a relatively large number of bitcoins compared to the usual trading volumes.
 
How will the Marshall Service be able to sell what amounts to several day's volume on the MtGox, which is the largest Bitcoin exchange (Friday's volume  was 8,656 units) without disturbing the market.  
 
Normal market activity would see a price drop in response to greater supply versus normal demand.  More sellers than buyers is normally a formula for lower unit prices.  But this is some sort of hybrid financial instrument not responding like might be expected when the FBI starts arresting founders and executives in a public company.  
 
 
 
 
 
 
bitcoin
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
The value of the digital currency bitcoin has fluctuated wildly based on the value of online transactions. Photograph: Thomas Trutschel/Photothek via Getty Images

 

 

 

 

 

US prosecutors ponder what to do with multimillion-dollar Bitcoin hoard

• Digital currency worth $27m seized from online black market
• Much larger sum still in dispute with website's alleged founder




 
US prosecutors in Manhattan are sitting on a multimillion-dollar bitcoin gold mine. And it could get much bigger.

Federal authorities hauled in 29,655 units of the digital currency – worth $27m or £16.5m at current exchange rates – through an official forfeiture by Bitcoin this week. 

The bitcoins had belonged to Silk Road, an anonymous online black market that authorities say was a conduit for purchases of drugs and computer hacking services – even a place where assassins may have advertised. It was shuttered after an FBI raid in September, when agents took control of its server and arrested the man they say was its founder in San Francisco.

No one stepped forward to claim these bitcoins, which were found in electronic "wallets" used to store the digital currency.

An additional 144,336 bitcoins, worth more than $128m today, were also discovered, but the government's claim on them is being disputed by Ross William Ulbricht, 29, who US authorities say was the founder and main operator of Silk Road

They had been stashed on his laptop.

It all puts authorities in an unusual position, given their concerns about the way in which bitcoins and other digital currencies are used by criminals to circumvent regulations intended to prevent money laundering. By trading in bitcoins, the government could give the currency some legitimacy.

Bitcoin is essentially software code that defines units of value, which users can move back and forth among themselves. 

Unlike other virtual money transmitters, its value is not pegged to a hard currency like the dollar or the euro; it is determined by the demand for bitcoins.

The US Marshals Service, which is in charge of liquidating such seized assets, will have to decide whether to sell the units on a Bitcoin exchange or find a private buyer, perhaps through an auction.

A spokeswoman for Preet Bharara, the US attorney for New York's southern district, said on Friday that the government is still trying to decide what to do with the forfeited bitcoins.

The timing of any sale could make a big difference in the amount the government could realise. Bitcoin's value has fluctuated wildly over the past six months. When Silk Road was seized, the bitcoins found on the server were worth $3.6m, far below their current $27m value. Friday's exchange rate was about $900 per bitcoin, according to the Tokyo-based Bitcoin exchange MtGox.

It is unclear whether a large sale of bitcoins by the government could drive down the price. Friday's volume on MtGox, which is the largest Bitcoin exchange, was 8,656 units.
"If it's worth $27m now, is that a high part of the market? A low part of the market? That's one of the decisions they're going to have to make," said Louis Rulli, a professor at the University of Pennsylvania Law School. "It would seem to me that they would probably convert those bitcoins into cash relatively quickly."

Barry Silbert, the founder of one of the first investment funds that lets retail investors gain exposure to Bitcoin, declined to offer an opinion on what the government should do with its stash or how a sale would affect the market. Marco Santori, a lobbyist for the Bitcoin Foundation, which is Bitcoin's official trade group, said the group did not have an official position on the matter.

Most goods seized by US authorities end up in the hands of the US Marshals, where they are auctioned or, at times, repurposed for government use. But the Marshals are not just experienced in unloading forfeited SUVs or houses; they also deal with complex financial instruments, foreign companies and other kinds of obscure assets forfeited by criminals.
"While Bitcoin is a somewhat new form of asset, it's not unusual for them to have to find out how to liquidate a new asset," said Jeffrey Alberts, a partner at Pryor Cashman and a former federal prosecutor in Manhattan. "This won't be difficult for them, whether they do it through an exchange or find a buyer who wants to buy it directly from them."

Ulbricht was arrested 1 October in a San Francisco public library and charged by prosecutors in New York with one count each of money laundering, computer hacking and drug trafficking. He is being held at a federal detention centre in New York without bail. He has not entered a formal plea but has maintained his innocence through statements by his lawyer.

Prosecutors last week asked a judge to grant them a default judgment in the civil forfeiture case they filed after the raid on Silk Road and Ulbricht's arrest claiming Silk Road's assets.

US district judge J Paul Oetken signed an order to that effect on Wednesday, giving the government control of the 29,655 Bitcoins from Silk Road's server but not of the bitcoins – the larger sum – discovered on Ulbricht's computer. Those are still in dispute.

The proceeds from any sale would be turned over to an asset forfeiture fund from which the US Justice Department can draw for law enforcement activities. If any money were to come back to prosecutors' budgets, it would be distributed evenly among US attorneys' offices, a policy meant to prevent individual offices from unduly seizing assets to pad their budgets.



 








 Link: http://www.theguardian.com/technology/2014/jan/18/us-prosecutors-seized-bitcoin-hoard




Tuesday, January 28, 2014

FAQ: Things to Know About Bitcoin

Indian authorities are still considering Bitcoins and might issue an advisory to warn against the potential risks associated with Bitcoins. (AP)
Indian authorities are still considering Bitcoins and might issue an advisory to warn against the potential risks associated with Bitcoins. (AP)
 
Published: 07th January 2014
What is bitcoin?

Bitcoin is a concept of virtual currency introduced in 2009 which was first launched by a pseudonymous developer, Satoshi Nakamoto. Also known as Crypto-currency can be traded for other currencies.

How does bitcoin work?

The concept of Bitcoin is all digitalized and hence for those who wish to invest in it, need to have a mobile application called Bitcoin Wallet which is available on Google Play and other online Play Stores.  You can also download computer program which provides the users with a personalized Bitcoin wallet in which you can easily receive and send Bitcoins.

Bitcoin has a system behind the scenes, for public ledger called “block chain.” This ledger contains every transaction that has been processed so far in terms of Bitcoins. Each transaction is protected by digital signatures corresponding to the sending addresses, which allows all the users to have control over sending Bitcoins from their Bitcoin addresses. This is process is known as “mining.”


Do people really invest in bitcoins?

Yes, people do invest in Bitcoins. IT was not a very popular activity before, but with time the popularity of this has increased to such an extent that at the end of August 2013, the value of Bitcoins exceeded up to US$1.5 billion with millions of Bitcoins exchanged daily.


Which all countries are in favour of bitcoins and which are against it?

 USA has said that prevailing money laundering laws would apply to Bitcoin as well. China, the second largest economy has banned the domestic third-party payment companies to stop the virtual currency in the country.

Indian authorities are still considering Bitcoins and might issue an advisory to warn against the potential risks associated with Bitcoins.

Across India, some of the retail outlets have expressed their willingness to accept Bitcoins. There are some companies in Iran which have evaded sanctions by using bitcoins for payments. One such company is persianshoes.com


How can you buy bitcoins?

There are two ways of investing in Bitcoins. One, you can buy them by paying real currency or take the Cloud Hashing route. But, experts have warned against investing through Cloud Hashing services, which offer “mining contracts.”


How to make bitcoin payments?

Bitcoin payments are just the way you make Debit or Credit card payments. All the Bitcoin payments are made from a wallet application, which can be done from a smartphone or a computer. All you require is the recipient’s address, the payment amount and then pressing send.

You can also scan the QR code or utilize the NFC technology to connect two phones.


What can you purchase with bitcoins?

There is a list of websites which accept bitcoins for payments, which means you can purchase from underwear to mini cannons for bitcoins. These transactions are completely anonymous and it cannot be traced back to you, which can also be looked upon as a disadvantage.


 What are the disadvantages of bitcoin?

Since all the transactions are done anonymously, there are a lot of drug dealing activities which occur with the help of bitcoins. 

A drug website called Silk Road in USA was recently shut down by FBI which transacted using bitcoins. The currency’s volatility is that many people view it as an investment than a currency. 

There are just people who use bitcoin as currency; most of the people use this as an investment.


How is the value of bitcoin determined?

The value of bitcoin is determined by the demand supply cycle. It depends on how much one wants to invest unlike other currencies which are determined by several factors such as printing more notes or interest rates






 Link: http://www.newindianexpress.com/business/news/FAQ-Things-to-Know-About-Bitcoin/2014/01/07/article1987868.ece





Prominent Bitcoin entrepreneur charged with money laundering



By Emily Flitter

NEW YORK (Reuters) - The vice chairman of the Bitcoin Foundation, a trade group promoting the adoption of the digital currency, has been charged by U.S. prosecutors with conspiring to commit money laundering by helping to funnel cash to illicit online drugs bazaar Silk Road.

Charlie Shrem, who had financial backing from the Winklevoss twins and is well known as one of the bitcoin's biggest global promoters, was arrested on Sunday at John. F. Kennedy International Airport in New York, the U.S. Attorney's Office in Manhattan said on Monday.

Shrem, who was also charged with operating an unlicensed money transmitting business, appeared in U.S. District Court in Manhattan on Monday and was released on $1 million bond. 


The 24-year-old entrepreneur, who lives above a bar he jointly owns in Manhattan that accepts bitcoins as payment, was CEO of BitInstant, a bitcoin exchange company that closed last summer.
 


According to prosecutors, Shrem conspired with a Florida resident, Robert Faiella, who ran an illegal exchange, to sell more than $1 million in bitcoins to users of Silk Road, which was shuttered by authorities last year.
Faiella, 52, is also charged in the complaint filed in U.S. District Court in Manhattan with conspiring to commit money laundering and operating an unlicensed money transmitting business. 


He was arrested at his home in Coral Gables, Florida. At his court hearing on Monday in federal court in Florida, Faiella consented to detention until Wednesday, at which point there will be a bail hearing.

Bitcoin is a digital currency that is not backed by a government or central bank and whose value fluctuates according to demand by users. Users can transfer bitcoins to each other over the Internet and store the currency in digital "wallets."
The criminal complaint says that Shrem, in addition to knowing that Faiella's business was funneling money into Silk Road, also used Silk Road himself to buy drugs, including marijuana-infused brownies.

"When Bitcoins, like any traditional currency, are laundered and used to fuel criminal activity, law enforcement has no choice but to act,"
Preet Bharara, the U.S. attorney for Manhattan, said in a statement emailed to the press on Monday. "We will aggressively pursue those who would co-opt new forms of currency for illicit purposes."
Bharara has said recently that prosecutors are not going after Bitcoin itself and view it as they view any other currency in which transactions are sometimes made illegally.

U.S. law enforcement officials have vowed to pursue any criminal activity in the nascent Bitcoin world as regulators try to formulate their approach to the digital currency.

The charging of a prominent Bitcoin Foundation official may be a blow to Bitcoin's prospects, though it did not have a huge immediate impact on trading. Bitcoins were exchanging hands at $970 late on Monday, down from prices above $1,000 earlier this month but up from around $150 four months ago on the Tokyo-based exchange MtGox.

Winklevoss Capital, which is run by twin brothers Cameron and Tyler Winklevoss, invested in BitInstant in 2012 and led a capital-raising effort last May that raised $1.5 million.



The twins, who are best known for their failed lawsuit against Facebook founder Mark Zuckerberg in which they had claimed he had stolen their idea for an online social networking platform at Harvard, have been seeking regulatory approval for a bitcoin exchange-traded fund.

"When we invested in BitInstant in the fall of 2012, its management made a commitment to us that they would abide by all applicable laws - including money laundering laws - and we expected nothing less," the Winkelvoss twins said in a statement. 


"Although BitInstant is not named in today's indictment of Charlie Shrem, we are obviously deeply concerned about his arrest," they said. "We were passive investors in BitInstant and will do everything we can to help law enforcement officials."

As part of the conditions of his bail, Shrem will be confined to his parents' home in the Marine Park section of Brooklyn. A report prepared by the court for his bail hearing listed his net worth at $6 million, according to U.S. Magistrate Judge Henry Pitman. Serrin Turner, an assistant U.S. attorney, opposed bail, saying Shrem had a "strong incentive to flee" and the means to do so.

Bitcoin insiders said Shrem's arrest showed just how hard it is to get away with illegal activity using Bitcoin, which has an ownership chain built into its software so that each unit can be tied to the users who have acquired or spent it.

"Using bitcoin for illicit transactions is really, really dumb," said Patrick Murck, the Bitcoin Foundation's general counsel. "Bitcoins are so easy to track."


"THE ART OF HIDING"


According to the charges, Faiella, going by "BTCKing" online, sold bitcoins to Silk Road users and passed on purchase orders he received from the site to Shrem, who filled them, transferring funds to Faiella's account at an unidentified bitcoin exchange service based in Japan.

The charging document says that Shrem failed to report suspicious activity to regulators "with respect to numerous Bitcoin purchases" Faiella made from BitInstant.

The document contains email conversations between Shrem and BitInstant's co-founder, who is not identified in the charges but is listed on BitInstant's website as Gareth Nelson, in which Shrem tried to hide his dealings with Faiella by pretending to ban him from BitInstant's exchange platform.

"You are hereby banned from our services," he wrote in an email to BTCKing that he copied to Nelson.

According to the complaint, Shrem then privately wrote to BTCKing, without including Nelson. "Your email address is banned," Shrem wrote, "but you can use a different one."

Bitcoins have been gaining wider acceptance recently. The Sacramento Kings basketball team earlier this month became the first professional sports franchise to say it would allow purchases using bitcoins. Last month, ecommerce site Overstock.com announced its plan to become the first major U.S. retailer to accept the digital currency.

Created in 2009 by a developer or team of developers going by the name Satoshi Nakamoto, whose true identity remains unknown, the bitcoin's earliest adopters have included people expressing a desire to conduct their affairs in a realm outside of government-sanctioned commercial spaces.

Some of that sentiment is visible in the charges against Shrem and Faiella. In one online interaction, Shrem tried to assure Faiella he was being discreet.
"The art of hiding is making people think you are someone else," he wrote.
 


Faiella replied: "You must understand that the people that we pay taxes to have a long reach and I like to stay away from that."
(Reporting by Emily Flitter in New York; Additional reporting by Nate Raymond in New York and Brett Wolf in St. Louis; Editing by Leslie Adler)




 





 Link: http://ca.news.yahoo.com/two-bitcoin-exchange-operators-charged-money-laundering-scheme-162424352--finance.html




Wednesday, January 15, 2014

Sustainable Business: How to make money and do good.





Harish Manwani joined Unilever as a management trainee in 1976; he is now the company's chief operating officer.

Why you should listen to him:

Harish Manwani is a Unilever man through and through. Having joined the company in 1976, he imagined that his time would be taken up with selling soap and soup. Not so, his then-boss told him. "You're here to change lives." It sounded far-fetched, but as the years went on and as he moved through the ranks of the corporation, Manwani began to understand his mentor's wisdom. Those words remain close to his heart even in his current role as the company's chief operating officer.

Now based in Singapore, Manwani graduated from Mumbai University and has a master's degree in management studies; he also attended the advanced management program at the Harvard Business School. He is the non-executive chairman of Hindustan Lever and a member of the executive board of the Indian School of Business.
"Harish Manwani is a strong believer in leading by vision. “A vision is not about setting targets, but about changing behaviours and motivating people to go the extra mile,” says Manwani. “A good leader must have the ability to define a compelling destination combined with a sharp operational focus on the ‘here and now’. That is key to delivering long-term success.” Yet, Manwani admits that he had done little long-term career planning, choosing instead to focus his full efforts on whatever tasks he was assigned at the time."
HQ Asia


 

Harish Manwani on the Web













 Link: http://www.ted.com/talks/harish_manwani_profit_s_not_always_the_point.html




m

Thursday, January 9, 2014

Justin Bieber makes $50 million a year, have a nice morning.


 

Marketing at its finest...  He must have made Elvis's lifetime earnings already...

.........................................................

Justin Bieber’s Manager Is Rich, Kind of a Genius



Lizzie Widdicombe’s New Yorker profile of Justin Bieber’s 31-year-old manager Scooter Braun has absolutely everything you want in a celebrity piece!
• There are great one liners! (“That skinny kid you just met is the most Googled person on the planet by like two hundred million hits.”)
• There are really fun details! (Most of Braun’s shirts come from Disney because “it’s non threatening.”)
• There is Bieber gossip! (“Bored, Bieber started a game, playfully jabbing everyone in the crotch with his fist.”)

Also, Justin Bieber makes $50 million a year, have a nice morning.



Link: http://thebillfold.com/2012/08/justin-biebers-manager-is-rich-kind-of-a-genius/



Wednesday, January 8, 2014

Federal prosecutors could be doing more to go after SAC Capital's billionaire founder Steve Cohen.


Did Frontline Go Too Far?

The influential documentary series argues federal prosecutors could be doing more to go after SAC Capital's billionaire founder Steve Cohen.
'Frontline subtly argues federal prosecutors could be doing more to go after SAC’s billionaire founder Steve Cohen'  
 
 
 
 

Friday, January 3, 2014

Company of Interest for the New Year: Gannertt Company

  1. GCI - Gannett Co., Inc. (NYSE)

    finance.yahoo.com
    • Gannett Co., Inc.
     
    29.580.00 (0.00%)
    Thu, Jan 2, 2014, 4:01PM EST - U.S. Markets open in 7 hrs.
    After Hours29.58 0.00 (0.00%)
    Delayed Quote
    • Open 29.55
    • High 29.69
    • Low 29.27
    • 52 Wk. High 29.87
    • 52 Wk. Low 18.38
    • Mkt. Cap 6.7411B




    1. www.gannett.com 
      The corporate website for Gannett, a media and marketing solutions company



    1. en.wikipedia.org/wiki/Gannett   Cached
      Gannett Company, Inc. is a publicly traded media holding company headquartered in Tysons Corner, Virginia, near McLean in Greater Washington DC It is the largest U.S. ...
    2. gannettblog.blogspot.com   Cached
      An independent journal about the Gannett Co. and the news industry's digital transition




    1. gannettoid.com   Cached
      Gannettoid.com serves as a collection of stories, links and other Web sites about Gannett Company, Inc., the media company that owns USA Today, 84 other daily ...
       
       
       ................................................

     Company

    Gannett is a media and marketing solutions company with a diverse portfolio of broadcast, digital, mobile and publishing companies.

    Gannett provides consumers easy access to the things that matter most to them – any way and anywhere.

    Gannett’s portfolio of trusted brands helps business customers connect with these highly engaged audiences through its industry-leading marketing services, customized solutions and national-to-local-to-personal reach.

    As Gannett builds on its valuable local brands and strong journalism, it also is expanding its mobile and digital businesses. It is a digital leader with a portfolio that includes a network of hundreds of local and national media organization web sites that reach 52 million unique users monthly; CareerBuilder.com, the nation’s top employment site which is expanding rapidly internationally and is already in 18 countries outside the U.S.; and top brands such as USATODAY.com; and USA TODAY Sports Media Group’s USA TODAY High School Sports; action sports network BNQT; MMAJunkie.com; and Big Lead Sports.

    USA TODAY, too, continues to be a leader in the mobile space, with more than 16 million total app downloads, including its iPad, iPhone and Android apps. Gannett Broadcasting is helping to lead the development of Digital Mobile TV.

    At the same time, the company’s digital marketing companies offer innovative marketing solutions for any audience. PointRoll, an industry leader in rich media advertising solutions and technology, powers more than 50 percent of all rich media campaigns online and serves more than 150 billion ad impressions each year. ShopLocal is a leading provider of online marketing solutions that connect retailers with shoppers through innovative and effective marketing, enabling more than 100 of the nation’s top retailers to deliver localized promotions directly to shoppers.

    The company’s 82 U.S. daily newspapers, including USA TODAY, reach 11.6 million readers every weekday and 12 million readers every Sunday, providing important news and information from their customers’ neighborhoods and around the globe. USA TODAY, the nation's No. 1 newspaper in print circulation, and USATODAY.com reach a combined 6.6 million readers daily.

    The Broadcasting Division’s 23 TV stations reach 21 million households, covering 18.2 percent of the U.S. population. Through its Captivate subsidiary, the Broadcasting Division delivers news, information and advertising to a highly desirable audience demographic on 9,500 video screens located in elevators of office towers and select hotel lobbies in 25 major cities across North America.

    Newsquest is one of the U.K.’s leading regional community news providers and its digital portfolio of newspaper and online-only brands attracts nearly 7.5 million unique users each month. It has a portfolio of 17 daily paid-for newspapers and more than 200 weekly newspapers, magazines and trade publications. Newsquest owns a successful online publisher called s1, which is a leading recruitment site in Scotland.


    Source: http://www.gannett.com/article/99999999/WHOWEARE/100427016 




Wednesday, January 1, 2014

The case for philosophers in boardrooms


  Financial Times

The case for putting philosophers into company boardrooms - FT.com

From a distance, it does not seem as if philosophy and business would have anything to say to one another. Businesses are concerned with meeting strict targets under time pressure, maximising revenue...
The case for philosophers in boardrooms