Over the years and as a frugal and lapsed accountant who deliberately gave away his considerable steadily and honestly-accumulated capital some years ago, then started to rebuild it only to succumb to a legalised scam and have a mistakenly-trusted business partner covertly syphon it away (impoverishing me and my young family), there are several scams that I have
successfully avoided and/or advised friends colleagues to avoid. These include pyramid schemes, get-rich-quick schemes and junk bonds and one of them would have to be Bitcoins.
Before any Bitcoin advocates rush to throw up their hands in horror at such (to them) heresy/blasphemy committed against their pet religio-political ideology or Thing-That-Might/Does-Make-Them-Speculatively-Rich, I would point to the conceit that Bitcoin is a currency or potentially a replacement currency
There are two points of clarification that may need to be made to this:
- For a thing to adequately fulfill the role of a currency, it would necessarily be relatively stable.
- "Speculation" is generally a euphemism for "gambling", which both rely on a potential lack of stability and neither term fits the economic definition of "investment".
First off, I am absolutely
in favour of an open/free and competitive market
and the idea of inventing a stable and feasible market-driven "currency" independent of and as an alternative to the official currency manipulated/maintained/controlled by The Man, or inventing even (say) a fiduciary instrument - e.g., carbon credits, sub-prime mortgages - but which is independent of and alternative to the fiduciary instruments manipulated/maintained/controlled by The Man and that is thus not subject to the self-serving whims/control of The Man or associated or other scams. Of course, carbon credits and sub-prime mortgages could not meet that latter criterion.
Here, "The Man" is a loose term for "The Establishment" or the prevailing Establishment's sanctioned/authorised entrenched financial manipulators - i.e., large speculators, government treasuries, or officially-approved regulators, banks and finance houses - which latter group are especially privileged/protected and said to be "too big to fail"
and which thus tend to be bailed out at egregiously excessive cost to the taxpayer and with seemingly regular monotony whenever they are on the cusp of failure and usually before they do
actually fail. (In an open/free and competitive
market, bank failure would be theoretically natural/tenable and could be a natural outcome of a lack of proper prudential management.)
Sadly, events have demonstrated pretty conclusively that, though Bitcoin seems
to fall outside of the domain of the Establishment's sanctioned entrenched financial manipulators, it nevertheless is highly unstable and wide open for use in speculation or fraudulent manipulation/scams - as this recent example seems to illustrate:
(Copied below sans
AlphaBay taken down by law enforcement across 3 countries, WSJ says
tags: Law & Disorder, alexandre cazes, alphabay, Silk Road
AlphaBay, one of the largest Tor-hidden drug websites that sprang up in the wake of Silk Road, has been shuttered for good after a series of law enforcement raids and arrests.
The site mysteriously went dark earlier this month. Some users on Reddit suspected an "exit scam," in which AlphaBay's founders had shuttered the site and absconded with piles of bitcoins.
According to The Wall Street Journal, which reported the news on Thursday, police in the United States, Canada, and Thailand collaborated to arrest Alexandre Cazes, who allegedly was the head of the online operation. The Canadian citizen was arrested on July 5 in Thailand, the same day that two raids on residences in Quebec, Canada, were executed. On Wednesday, Cazes was found dead, hanged in his Thai jail cell.
The Bangkok Post, citing Thai police sources, reported that Cazes had been living in Thailand for about eight years. Thai authorities also impounded "four Lamborghini cars and three houses worth about 400 million baht ($11.7 million) in total."
Cazes' name does not appear in a search of federal court records, but if any charges do exist, they may still be sealed.
Ross Ulbricht, the young Texan who was convicted of creating and operating Silk Road, was given a double life sentence—which was upheld earlier this year on appeal. Ulbricht was also known as "Dread Pirate Roberts."
The Department of Justice did not immediately respond to Ars' request for comment.
Presumably, Bitcoin has been found by some in the criminal fraternity as an attractive covert/illegal medium of exchange in crimes/scams and which can be relatively easily laundered into "legitimate money". (The same could seem to to be true, to some extent, of carbon credits and sub-prime mortgages.)