Entries with tag bitcoin.

New Legal Defense Fund Raises Funds for Lawsuit by Man Named as Possible Bitcoin Creator

A website is raising money to enable Dorian Satoshi Nakamoto—a 65-year-old man that Newsweek magazine, in a March 2014 article, said appeared to be bitcoin’s creator—to possibly sue the publication. The website NewsweekLied—sponsored by Nakamoto’s attorneys at Kirschner & Associates—asks for contributions to be used for mounting a legal defense on his behalf, “to raise money to hold Newsweek accountable for [its] article.” He appears in a photograph on the site. The NewsweekLied website states Nakamoto and his family were “misquoted. In some cases, words were attributed to them that were never said.” Nakamoto specifically said that he didn’t create bitcoin. The website does not state what Newsweek would be sued for. So far, roughly $23,000 worth of Bitcoin has been donated by other supporters for Nakamoto’s personal use. Some Nakamoto supporters are skeptical about the motives behind this effort, implying Nakamoto’s attorney is spurring the effort. The article describes, in detail, the life story of the Temple City, California, man and features interviews with his family and others regarding the possibility this Nakamoto is the same Nakomoto who created bitcoin. (Tech Crunch)(CoinDesk)(Newsweek Lied)

US Agency Investigates Bitcoin Hardware Provider

The US Federal Trade Commission is asking a federal judge to grant a preliminary injunction against Butterfly Labs, which would place the Bitcoin-mining-hardware manufacturer in a court-appointed receivership and extend a temporary restraining order filed by the agency. The injunction alleges that Butterfly Labs used customer-ordered machines to mine bitcoins before shipping them, saying the practice was part of their testing, allowing the company to pocket Bitcoins that should have gone to its customers. The FTC says it is also investigating three of the company’s directors for spending company money on personal products and services while not fulfilling orders, thereby taking what amounts to interest-free loans from customers. Butterfly Labs is currently working under a temporary restraining order. The court previously allowed the FTC to seize Butterfly Labs’ assets and close its operations before the case goes to court. (Ars Technica)(CoinDesk)


PayPal Enabling Limited Bitcoin Payments

PayPal announced it is enabling specific retailers to accept Bitcoin through its payment service. It is working with three payments processors: BitPay, Coinbase, and GoCoin. The payments are being accepted on the PayPal Payments Hub. The companies have been working on this project for several months. Through the use of the service, merchants can use one or all three processors. Digital currency advocates say this could be an important stage in the mainstream adoption of Bitcoin. After the announcement, the value of Bitcoin on a US-based exchange rose from $395.29 to $450.00. PayPal notes it is moving carefully ahead with virtual currency transactions. “We’re proceeding gradually, supporting Bitcoin in some ways today and holding off on other ways until we see how things develop,” wrote Scott Ellison, senior director of corporate strategy, on the PayPal blog. No other virtual currencies will be accepted. The service is now only available to digital retailers based in North America. Some observers are hoping this collaboration signals the beginning of more of these types of partnerships. (BBC)(CoinDesk – 1)(CoinDesk – 2)

US-Based eTailers Increasingly Accept Bitcoin

More US-based online retailers—including Dish Network, Expedia, and Overstock.com—are allowing payments via bitcoin. Market analysts say the virtual currency is moving toward mainstream acceptance for online purchases, with full adoption occurring in about five years. Currently, market analysts note, consumers still prefer to use credit cards. Continuing volatility in the bitcoin exchange rate, which is unregulated, is also deterring consumer acceptance. However, merchants like using bitcoin to avoid credit-card fraud and transaction fees paid to credit-card companies. (Reuters)(Mashable)

US Venture Capitalist Wins Seized Bitcoins

Venture capitalist Tim Draper submitted the winning bid in a US Marshals Service auction of bitcoins seized from the Silk Road, a controversial underground website allegedly involved in drug dealing. Draper paid $18 million for 30,000 bitcoins that formerly belonged to Silk Road, which the FBI shut down in 2013. More than 40 people participated in the recent auction. Draper will reportedly use the virtual currency in partnership with the Vaurum bitcoin exchange. (Reuters)(Tech Crunch)(Vaurum)

US Government Mistakenly Releases Bitcoin Auction List

The US Marshals Service accidentally sent an email containing a private list of people interested in bidding on government-seized bitcoins to all of the bidders who had sent queries in regarding the auction. The 27 June 2014 auction of 30,000 bitcoins (worth $17.9 million)—which the US Federal Bureau of Investigation seized in an October 2013 raid related to the controversial Silk Road anonymous marketplace—was to have been anonymous, with bidders not knowing who their competitors are. The Marshals Service’s message to 40 potential bidders concerned new information about the auction. However, the agency carbon-copied, rather than blind carbon-copied, the recipient list, making all the names visible.  (BBC)(CoinDesk)(Tech Crunch)

US Court Approves Bitcoin Exchange’s Bankruptcy Proceedings

A US bankruptcy court has allowed Mt. Gox—which was once the world’s largest bitcoin exchange but which closed earlier this year amid confusion about missing money—to begin Chapter 15 bankruptcy proceedings in the United States. The company filed 9 March for Chapter 15 protection, which, for example, prevents US customers involved in a class action suit from seizing its assets. Mt. Gox shut down after it lost 850,000 bitcoins—750,000 belonging to customers—and subsequently found only 200,000 a digital wallet. The company is finalizing both a settlement with its US customers and the sale of its business. A federal court must approve the settlement, which would let US and Canadian customers divide the 200,000 bitcoins Mt. Gox found and share in a 16.5 percent stake in the company when and if it sells. In Japan, a court liquidated the company and appointed a trustee to investigate the missing bitcoin. The trustee says it is too early in the court proceedings to consider any offers. The US decision allows the Japanese trustee to examine witnesses, gather and review evidence, and oversee any US assets involved, such as computer servers. (Reuters)(Engadget)(CoinDesk)(Bloomberg)

Expedia Starts Accepting Bitcoins

Expedia has decided to take bitcoins for transactions. The travel website is accepting the virtual currency for US hotel bookings and may take it for other services in the future. Market watchers say this could be a significant step toward bitcoin’s mainstream acceptance. Emily Spaven, managing editor of bitcoin news site CoinDesk, told the BBC the move was “brilliant news” that “brings digital currency further into the consciousness of the mainstream.” Expedia plans to use bitcoin exchange Coinbase to process its transactions and will convert its bitcoins into US currency every 24 hours, according to Michael Gulmann, the travel company’s global vice president. This will help eliminate some problems associated with bitcoin’s exchange-rate volatility. (BBC)(Mashable)(Expedia)

Dish Network Begins Accepting Bitcoins for Payments

Satellite-services provider Dish Network has announced that it will let customers pay their bills with bitcoins starting 1 July 2014. It will use the services of bitcoin exchange Coinbase to process payments made via the virtual currency. “We always want to deliver choice and convenience for our customers and that includes the method they use to pay their bills,” said Dish executive vice president and chief operating officer Bernie Han . “Bitcoin is becoming a preferred way for some people to transact, and we want to accommodate those individuals.” Despite concerns from government officials and the financial sector about the virtual currency because of problems such as the recent closure of the world’s biggest bitcoin exchange, several online retailers and organizations such as Overstock.com, Zynga, and the Sacramento Kings US professional basketball team are accepting it for payment. (Reuters)(Wall Street Journal)

Company Conducts Industrial-Scale Bitcoin Mining

The process of bitcoin mining—the creation of new bitcoins—is intended to be computationally intensive to discourage counterfeiters from trying to manipulate the system. Some individuals have built custom computer systems for more efficient mining operations. It was only a matter of time, given the increased interest in and value of the virtual currency, that someone decided to scale up such an operation. Dave Carlson has taken this to another level by scaling up this process and creating MegaBigPower, which is now a major bitcoin-mining organization. CEO Carlson said his operation will soon account for between 7 and 10 percent of the world’s bitcoin-mining processing power. He plans to reach that goal with thousands of bitcoin-mining computing units, using 1.4 million BitFury bitcoin-mining chips managed by a tiny Raspberry Pi computer. The company spent between $3 million and $5 million for the system and is now generating between 7,000 and 8,000 bitcoin—worth between $3.1 million and $3.5 million—per month. The operation’s primary investor is the Polish nonprofit R&D organization BioInfoBank. MegaBigPower also rents capacity on its system to others interested in bitcoin mining. (SlashDot)(Ars Technica)

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