# Last edited on 2014-05-29 13:44:47 by stolfilocal
# NOT POSTED

[quote author=dreamspark link=topic=178336.msg6748692#msg6748692 date=1400176759]
I don't get the relevance that has to your proclamation that SR bust had a lasting negative effect on price.[/quote]
I don't know if it had, but we can't know that yet.   People seem to blame the busting of SilkRoad for a 30-40% drop in price lasting from June to August 2013.  It is hard to tell whether there was any permanent effect, since that would have been overwhelmed by the Oct/Nov 2013 rally, which was obviously due to China and therefore hardly affected by the SilkRoad thing.

[quote author=dreamspark link=topic=178336.msg6759974#msg6759974 date=1400232952]
I don't disagree with you about the image but that doesn't directly relate to price.[/quote]
Let me say that I am not bothered much myself about the use of bitcoin for illegal drugs traffic. In fact I believe that the FBI is drooling about bitcoin, because they must find it much easier to catch the Ulbrichts and Shrems who use bitcoin than those luddite traffickers who use cash, or even bank transfers.  Imagine having all illegal payments made through a single "Bitcoin International Bank", recorded in [b]one[/b] database with a simple and well defined format, which can be monitored, whole and in real time, without having to show probable cause and obtain a warrant.

(I am far more bothered by the galaxy of scams that surrounds bitcoin, and especially by the tolerance that bitcoiners seem to have for scammers and sleazy guys.  Neo&Bee investors (and Coindesk) refused to admit that Brewster was a bad guy for weeks after he ran away.  Former MtGOX clients apparently don't care about the background of the Sunlot guys, and don't mind letting Gonzague and probably even Mark walk away free.  No one seems bothered by the endorsement that Roger Ver gave of MtGOX, or Antonopoulos gave of Neo&Bee.  The prevailing attitude seems to be "OK, it was a scam, let's forget it and move on, for bitcoin is much more than that."  Unless that attitude changes, bitcoin will be much more [b]of[/b] that.  But I digress.)

But the point is not what I think.  The association of bitcoin to illegal payments seems to be common out there.  That perception must have a negative impact on adoption, especially by reputable institutions, and on the attitude of governments.  To what extent, I don't know.

It is interesting however that both the EFF and the Wikimedia Foundation decided not to accept bitcoin donations (and yet Jimmy Wales is a fan of Ayn Rand, IIRC).  It may not be due to bitcoin's popular image as "the currency of crime"  (in the case of the EFF, the official explanation was that they do not want to appear to be endorsing any "product"), but that image certainly did not help. 

[quote author=dreamspark link=topic=178336.msg6759974#msg6759974 date=1400232952]
You say that it a negative feature for most else but why don't they see that as a negative feature of fiat? Or are we being hypocritical?[/quote]
Bitcoiners should please avoid these "so what, they too" responses, they are quite irritating.  "Bitcoins appealing to criminals, so what, cash appeals to them too."  "Bitcoin exchanges launder money, so what, banks launder money too."   "Bitcoins can be stolen, so what, credit cards can be stolen too." Yeah, and "He killed twenty people, so what, Hilter killed sixty million too."

But, in fact, bitcoin is definitely worse than those "competitors", considering its size:

  * From many posts in this forum, it is obvious that many enthusiasts love bitcoin [i]precisely[/i] because they see it (very naively, IMHO) as a way of making illegal payments, evading taxes, and hiding illegal money from the government.   The impact of the SilkRoad bust on price indicates that, at the time, illegal payments were a significant use of bitcoin.  In contrast, I have never heard of a drug bust having a detectable impact on the dollar's exchange rates, or on the use of credit cards.  

  * Ditto for money laundering: I have seen several posts suggesting that third world countries should be good markets for bitcoin "because they have many corrupt officials and politicians who need to move their bribes out of the country" -- and the posters' viewed that as a positive thing since it would help raise the price.

  * Logic and facts indicate that stealing bitcoins is [i]easier[/i] than stealing credit cards or cash.  While computer-savy people may be able to protect their keys fairly well, common users will inevitably expose themselves to the same situations that lead to credit card or password theft -- with the difference that bitcoin theft is immediate and irreversible, much less risky for the thief, and much harder to investigate.   Even without counting MtGOX, the amounts of bitcoins reported stolen last year are certainly more than the 100 million USD payments processed by BitPay.  They are MUCH more than the amount that banks would have "stolen" from BitPay customers if they had used credit cards instead.

Thank Bob one cannot kill with bitcoins.  Unless one counts [url=http://news.asiaone.com/news/singapore/cleaning-supervisor-who-found-body-dead-ceo-there-was-foul-smell]Autumn Radtke's mysterious "suicide"[/url].  And unless one uses bitcoins to hire professional killers, pay for terrorist attacks in "unfriendly" countries, buy assault rifles and machine guns, ... er ... let me take that "thank" back...    ;)  :P