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Bitcoin

Bitcoin, released to the world in 2009 by a person or people called Satoshi Nakamoto, is not backed by a central bank or a government and is seen as an alternative payment system. In February 2013, Bitcoin went into the mainstream as a monetary crisis threatened to bankrupt Cyprus, seen as a safer bet. Early adopters of Bitcoin have been richly rewarded as the price has soared – in one case, a young Norwegian bought a house from an $850,000 windfall on a US$22 investment.

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DIGITAL CURRENCIES

Bitcoin firm Hong Kong Crypto Exchange mum on backers' identities

PUBLISHED : Sunday, 02 February, 2014, 4:23am
UPDATED : Sunday, 02 February, 2014, 9:34am

Hong Kong's latest bitcoin exchange is set to become the city's best funded even amid questions about the identities of its backers.

A refusal by those running Hong Kong Crypto Exchange to name the local people who have invested US$2 million in the business has reignited concerns about criminal use of the digital currency.

The city's third bitcoin exchange cited non-disclosure agreements for its refusal to reveal its owners' identities.

"It is no secret nowadays there are several large exchanges in the world. However, all of them experience difficulties working with fiat currencies," said the company's chairman and CEO, Pheng Cheah. "Our exchange won't have these shortcomings."

After the arrest last week of bitcoin promoter Charlie Shrem, charged by US prosecutors with conspiracy to launder money, the Customs and Excise Department warned currency-transfer businesses to ensure they had proper safeguards in place to prevent money laundering and terrorism financing.

"You should assess the extent to which your services are vulnerable to ML/TF [money laundering and terrorism finance] abuse," it said in a circular released by the Money Service Supervision Bureau. "This issue is especially relevant where emerging technological developments may facilitate anonymity."

“Anonymity of the investors may not be conducive to building trust,” said Charles Mok, lawmaker representing the information technology sector. “But then again, even who initiated bitcoin itself is a secret, so how much does it further matter that the investors of an exchange is anonymous? It may or may not matter much. Those who want to play will continue to play. Those who don’t trust it to begin with will not.”

Zennon Kapron, head of mainland-based financial research firm Kapronasia, said the deal was “indicative of the opportunities that are available for exchanges that look at the Asia market.” He added it was not uncommon for investors to seek anonymity in these kinds of deals.

It seems investor interest in bitcoin exchanges remains even after a crackdown by the People's Bank of China late last year. The move by the PBOC saw the price of bitcoin fall more than 35 per cent to 4,900 yuan (HK$6,200) from its peak of 7,588 yuan.

Not all investors in bitcoin companies are keeping their identities secret.

Coinbase said in December it had raised US$25 million from Silicon Valley venture capital firm Andreessen Horowitz, an early investor in Facebook and Twitter.

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paulgillis
The math may make sense, but it remains a money laundering scam.
daily
Bitcoin is a scam, but it just uses a lot of hype to cover up the background money laundering and pyramid scheme it is building up..............for those of you who are pouring your money into this scam, you will lose it all sooner or later.
 
 
 
 
 

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