The Ten Most Anticipated Bitcoin Projects for 2012

By The Bitcoin Trader
Friday, December 30, 2011

http://www.thebitcointrader.com/2011/12/10-most-anticipated-bitcoin-projects.html

I'm not so sure that Satoshi Nakamoto could have anticipated the wave of projects that have been and continue to be inspired by his creation. At this very moment, one can only imagine the development progressing in secrecy among the hundreds, if not thousands of computer programmers, investors, financial types, marketing gurus, or otherwise, that have found their second wind thanks to the possibilities of Bitcoin.

Unfortunately, I'm not privy to the closely-guarded secrets behind most of Bitcoin's projects, however many there may be. Many developers, however, are more than happy to share their ongoing work with the community, enough to definitely get us excited about Bitcoin's prospects for next year. So, without further adieu, these are The 10 Most Anticipated Bitcoin Projects for 2012:

10) BitSynCom and the MeshNet

Though somewhat mysterious about their plans, BitSynCom recently announced a massive project to assist the growing effort to launch what can only be described as "the peoples' Internet." Called MeshNet, it would be a peer-to-peer version of the Internet, dependent on its users for owning and operating the supporting infrastructure.

BitSynCom hopes to integrate Bitcoin with MeshNet to act as a payment system to reward those who maintain the infrastructure and provide bandwidth, and to charge those who use it. The development time for such an ambitious project will likely extend well past 2012, but we may see it get legs next year, especially if SOPA comes to pass in its current form. For more information, you can watch an interview with Yifu Guo of BitSynCom, here.

9) The Bitcoin Bond

"JackH" first mentioned the concept of a Bitcoin Bond back on October 25th of this year. The idea is that a publicly traded entity could be used as a vehicle through which investors could buy a piece of the Bitcoin pie while not directly purchasing any Bitcoins. The Bitcoin buying would be the responsibility of an agent associated with the "company." It's an arrangement that would sound familiar to anyone who dabbles in gold and silver ETFs.

The main driver of the project is to mitigate the fragility of the current relationship between banks and Bitcoin exchanges, as there were several instances of banks suspending their accounts with Mt.Gox, Tradehill, and Intersango over the last few months (though it's been quiet as of late).

The latest hurdle facing "JackH" is the cost of developing the legal framework for the company, which was quoted at over 200,000 British Pounds. Yikes! Apparently Mr. H. does have interested investors, though their pockets aren't quite deep enough to come up with that chunk of change. He continues to look for cheaper lawyers...

8) Bitcoin Browser Extensions

Though several attempts have been made at a browser extension, none have really proven effective nor have caught on with Bitcoin users, and most of the development in this field came to a grinding halt when the bubble burst in June. At the moment, it does not appear that anyone in the community is working on an extension, but with the pending implementation of the URI scheme and release of a thin version of the Satoshi client, a browser extension would be the next logical step and would make Bitcoin incredibly user-friendly. Hopefully we'll see one develop in 2012.

7) Bitcoin Options and Futures Trading on the Major Exchanges

2011 will no doubt be remembered as the year that Bitcoinica took Bitcoin by storm. With leveraged trading, playing the Bitcoin markets went from tee-ball to the big leagues, seemingly overnight. 2012, however, will take things to a whole new level. Mt.Gox and Tradehill have both hinted at the fact that they will be unveiling futures and options markets as part of their development plan, with Mt.Gox possibly bringing the features online as early as next month when they are set to unveil... well, something.

6) ICBIT Stock Exchange

Giving Mt.Gox, Tradehill, and Bitcoinica a run for their money will be the ICBIT Stock Exchange. Currently in alpha testing, the exchange promises options and futures trading, as well as the ability to buy traditional stocks using Bitcoins, all of the above on margin, of course.

Having access to derivatives will help to smooth out the volatility that we currently see in Bitcoin trading, and will also give merchants and miners the ability to hedge their holdings (or future holdings). These are key components to establishing a respectable currency market, and will surely generate a lot of interest outside of the Bitcoin community.

5) Electrum Overlay Network

Still looking for an official name to distinguish itself from the Electrum client (I like Overbit, myself), the Electrum Overlay Network is looking to integrate many of the services that are currently found elsewhere, as well as some that do not already exist, and bring them under the umbrella of a single platform. Features will include:

• Client integration of BTC/fiat exchanges;
• Wallet storage for diskless or extremely low-resource clients;
• Server-side escrows (sending bitcoins to an email address);
• Integration of bitcoin laundry;
• Exchange calculators (to display the “fiat” equivalent value of BTC in clients);
• Firstbits support;
• Mining support for clients; and
• Various transport protocols (especially HTTP Push, which allows PHP websites to integrate easily with Bitcoin).

This feature-rich software will be extremely popular and likely catapult Electrum to the front of the client-race, though you never know what the next guy has in his back pocket. Speaking of which:

4) Bitcoin Client Upgrades

Though not scheduled for the 0.6 version of Bitcoin, Gavin Andresen has hinted several times at his increasingly urgent desire to release a thin version of the standard client. Motivated primarily by the poor first-time user experience that comes with the full blockchain download, Gavin's dev team will likely deliver a thin version of the client in 2012. The blockchain is already topping out at 1.2 GB, and we'd hate to see what it will look like by the end of next year. In fact, most of us would rather never see it again as long as we know the friendly miner community is keeping tabs on it. Please Gavin, make the blockchain go away!

Also sorely needed is the implementation of the Bitcoin URI scheme. Currently, most Bitcoin transactions happen through the copying and pasting of ugly-looking strings of numbers and letters (i.e. public keys) that have to be manually checked and re-checked before a transaction can take place. With the URI Scheme, the click of a link in a browser will automatically launch the client and incorporate the address into a transaction. It's much needed, and we hope to see it next year.

3) New Bitcoin Transaction Types

I touched on this topic with my post about Bitcoin 0.6, but it's important enough that it needs to be repeated. The upcoming version of Bitcoin, and there will no doubt be more than one iteration in 2012, will support new transaction types. Essentially, the new version will allow for transactions with multiple signatures, thus allowing for escrow-type contracts with third-parties involved.

Having the option for multiple signatures will also add a new layer of security to Bitcoin, where you will be able to require that your transactions be signed by two different private keys, stored in physically separated devices. This added level of security will stop potential hackers and wallet thieves in their tracks, and make credit cards look downright irresponsible. It's the reason why new transactions types are number three on our list.

2) Open-Transactions (OT)

Already in private alpha-testing on a live server, OT, the brain-child of Fellow Traveler, is going to be extremely important in 2012. Really, its relationship with Bitcoin only tells part of the story, but it's an important relationship nonetheless. Bitcoin is the oil lubricating an OT machine that will enable such a vast array of financial instruments and contracts that lawyers everywhere will beg for retirement packages before they are inevitably smacked in the face with pink-slips as their jobs are made redundant.

OT will allow for truly anonymous, off-the-blockchain, instantaneous transactions, thus silencing some of Bitcoin's harshest critics. This will be a capability so powerful that integration with TOR will almost be a necessity. Multi-asset trading and smart contracts will be OT's killer apps, though the power of OT will only be limited by the imagination.

1) Max Keiser and the LoveBitcoins.org Campaign

Announced at the European Bitcoin Conference, Max Keiser is teaming up with lovebitcoins.org with the goal of bringing 1,000,000 new users to Bitcoin in 2012.

In addition to his radio and web presence, Max (I'm assuming we're on a first-name basis) has his own segment on Russia Today called the Keiser Report, with a huge audience that is sympathetic to the Bitcoin cause.

Equally important here is the structured marketing organization starting to develop within the Bitcoin community that will be extremely important to promoting the technology in 2012.

---

2011 was a year of growing pains for Bitcoin. It was both loved and hated by the media and subject to a huge bubble that topped out with a market cap of over $200 million. Hackers and miscreants took shots at exchanges and Bitcoin users alike, yet the currency and the community proved their resilience.

Bitcoin is positioned better than ever to prove to the world its significance and utility. These incredible projects only hint at some of what's to come in 2012, which will no doubt be the year that Bitcoin comes of age.

Reprinted with permission.

Digital Currency Systems: Emerging B2B e-Commerce Alternative During Monetary Crisis in the United States

By Constance J. Wells, M.S. Aspen University Tuesday, February 8, 2011

From the Abstract:
Digital currency systems form the triumvirate nexus of government policies, money, and technology. Each has a global reach and responds to the needs of business and consumers. E-commerce depends on private and government financial institutions to enable payment transactions; the basis of e-commerce. As the United States financial crisis continues B2B enterprises may need to abandon traditional payment transaction systems and look to alternatives, in the form of Web based digital currency systems accessed via the Internet. The various types of digital currency systems generally fit into five categories: Barter Exchange Software Systems, Non-Bank Digital Currency Payment Systems, Digital Precious Metal Systems, Online Value Transfer Software Systems, and Online Stored Value Transaction Software Systems. Digital currency systems are not online banking. Digital currency systems use private electronic monies: electronic tokens, barter-exchange currencies, digital cash, and stored value e-cash vouchers. We explore the history of money against a backdrop of banking and government policies that cause cyclic monetary crisis's, how these current digital systems operate, how business can thereby benefit in their use, and why digital currency systems are such an underutilized service in the United States.

Digital Currency Systems: Emerging B2B e-Commerce Alternative During Monetary Crisis in the United States

View more documents from cjwells

Why Bitcoin is a Foundational Change That Won’t Go Away and Could Change Everything

The following bitcoin article was posted at the P2P Foundation website on November 26, 2011:
Why Bitcoin is a Foundational Change That Won’t Go Away and Could Change Everything Reprinted with permission from ID3.org.

Air Guitars and Bitcoin Regulation

By Jon Matonis

No one really sends or receives bitcoin. They merely transfer their ownership and specific control rights to the block chain on the giant public ledger in the cloud. It's like an air guitar. The bitcoin itself exists because we all say that it exists.

The same can be said of bitcoin's exchange value – it has value because we all say that it has value. That is both its weakness and its brilliance. Its intangibility prevents its confiscation. Where are your bitcoins Mr. Anarchist? Well sir, they are right over there stacked next to my new air guitar. What, you don't see them? I swear that they are there. I don't think governments will ever declare that they can see them too! Because if governments did see them, then bitcoin would be imputed with tremendous legal monetary value and they don't want to do that. Governments will want to diminish the credibility of bitcoin – not enhance it.

Now, to the exchanges. This is where the enforcement and regulations will hit first. Trading bitcoin in and out of national currencies is currently necessary because many transactions still have to be settled in that manner. Of course, this will adjust over time as more and more bitcoin value can remain in the bitcoin ecosystem for necessary daily transactions. But in the meantime, regulation is increasingly possible in this area due to exchanges requiring a certain degree of jurisdictional presence and centralization. As with buying and selling air guitars on eBay, regulators can exert influence because there is a centralized point of exchange. It matters not what is being exchanged.

Regulatory Bias With Some in the Bitcoin Community

"We are working with the government to make sure indeed the long arm of the government can reach Bitcoin."
--Jeff Garzik, Bitcoin Developer

"Regulation would allow the proper authorities to find and charge those who use bitcoins for illegal activities." 
--Amir Taaki, Co-founder of Bitcoin Consultancy
 
"Norman is pushing to bring Bitcoin away from its roots and closer to a traditional currency — he is reaching out to regulators, looking to get legislation to oversee the system."
--CNBC on Donald Norman, Co-founder of Bitcoin Consultancy 

These are the big three bitcoin regulatory proponents within the bitcoin community. There are certainly many more outside of the community. Now, let me see if I can summarize their rationale because these quotes are not isolated incidents and they are not taken out of context. I believe that the rationale is twofold: (1) a reaction to the anonymous online drug company Silk Road tainting the fledgling currency; and (2) a belief that bitcoin exchanges given a regulatory blessing will be in a position of strength for customers exchanging in and out of national currencies.

Both of these rationales are misguided, especially when bootstrapping a decentralized P2P cryptocurrency. Bitcoin was designed from the outset to route around centralized, authoritarian interference. Bitcoin's designer(s) anticipated regulatory termination and asset confiscation because bitcoin itself is a direct challenge to the privileged money monopoly of the sovereign. The issue is not whether bitcoin as a digital currency embodies libertarian political and economic beliefs – it was simply designed to survive. However, it is supremely naive and daft to think that a government will not soon erect laws and regulations to prevent anonymous and untraceable transactions. Additionally, government tends to tax that which it regulates and a sanctioned bitcoin will soon be transformed into an 'approved' and useless digital currency.

Bitcoin exchanges are constantly under attack in various parts around the globe and even with partially-regulated exchanges, laws can always be modified to accomplish the aims of the State. The solution is to create decentralized exchanges and to promote business models and closed-loop paradigms that make fitting into the current institutional structure irrelevant. It is a perpetually losing battle to seek minor legal victories within the confines of an arbitrary, subjective court system.

In differentiating between the fear of punishing coders and the fear of punishing the consumers and merchants that openly choose to transact in bitcoin, James Westlock summed it up nicely in his comment to the "Bitcoin and Agorism" article:

"Everyone here understands that a Bitcoin exchange is nothing to do with Bitcoin clients and the source code that is compiled into them. The imbeciles who run exchanges in police states like the USA will be scrupulously avoided by anyone with a brain cell, and those who set up exchanges in free(er) countries will reap the benefit. Anyone developing a Bitcoin client cannot be charged with conspiracy with regard to the uses that the client is put to, in this case exchanges. The client is neutral, just as browsers are neutral. You can use a browser to commit a crime, but culpability for that criminal act cannot be passed to the people who code the browser (Mozilla, Google, Apple)."

To be sure, David Norman and Amir Taaki have many more pro-regulation references and citations available at their website. For instance, Taaki gives a radio interview with the Katherine Albrecht Show in the U.S. Then, reporting in the Independent, Stephen Foley quotes David Norman on the hackers that brought down the largest bitcoin exchange:

"In the UK, supporters of Bitcoin made an urgent appeal to the Financial Services Authority to regulate the largest London-based exchange, so as to reassure people that using Bitcoin is safe. 'Unregulated businesses don't usual cry out for regulation,' said Donald Norman, co-founder of the exchange Britcoin. 'But because we are unusual, and because we are dealing with people's money, and because of all the scary stories around Bitcoin, we would like nothing more than to have a government authority looking into our accounts – especially now.'"

In order to gain legitimacy for a decentralized P2P cryptocurrency that comes with user-defined anonymity and user-defined traceability, the Statist apologists have gone out of their way to seek clear and concise guidelines from the government on what will and will not be permitted with respect to bitcoin activity. They may soon get their wish. 

UK Financial Services Authority on Bitcoin Regulation

A response purporting to be from the FSA appeared recently in the Bitcoin Forum. In reading the well-referenced text, it appears obvious that bitcoin itself cannot be regulated as money but that exchangers would fall under the guidelines of FSA regulation because they are deposit takers and holding balances in national money before and after the bitcoin exchange takes place. A bitcoin service that simply provided a matching service, such as bitcoin-otc, where buyers and sellers settled on their own would not therefore fall under the regulation.

This is important because of various claims circulating that there is a coordinated effort on the part of EU-based financial institutions to freeze or impede bank accounts that are acting as agents for bitcoin exchanges or bank accounts of bitcoin exchanges themselves. In August 2011, the French bank CIC froze MtGox client funds and closed the bank account paving the way for a court case and final decision on October 18th, 2011. Then on October 21st, 2011, MtGox released this statement:

"While Bitcoin at a European level is so far not directly impacted by this decision, the Bank de France (France's central bank) has confirmed that because of European banking rules, monetary transfers (deposits and withdrawals) through a single entity are subject to financial regulation and therefore can only be performed by licensed financial institutions such as banks or Payment Service companies (the European Equivalent to a Money Service Business). This decision has forced us to find other payment processing partners within Europe that will allow us to quickly resume all EUR transactions for our European customers soon."

Seeking legal opinions and regulatory clarification will only result in more disappointments. Therefore, in order to obtain the ruling that the bitcoin regulation proponents seek, bitcoin exchanges and bitcoin merchant applications will have to be adapted to support the enforcement of AML rules regarding money service businesses and identity verification for prepaid access products, such as the recent FinCEN regulatory changes from the United States.

In the future, we are likely to see regulations and enforcement against the bitcoin exchange infrastructure as well as restrictions on bitcoin transactions at the large online and offline merchants subject to establishment transactional reporting requirements. Both enforcement avenues will be deployed in an effort to undermine the usefulness and acceptance of bitcoin, because quite frankly that will be the only option available to authorities. 

Cryptocurrencies are Not Virtual Goods

Vili Lehdonvirta works as a researcher at the Network Society research programme at Helsinki Institute for Information Technology in Finland and he is Visiting Scholar at the Interfaculty Initiative for Information Studies at the University of Tokyo. His research examines the social and economic impact of new information technologies, especially online games, social networks, virtual currencies, and virtual taxation.

He believes that the bitcoin currency goes way too far in providing user-defined anonymity and user-defined transaction traceability. Although he doesn't mention how the transition to a digital cash society can justifiably deny the very same attributes enjoyed with physical paper cash today, he seems to promote his own "ideal" vision of how the future cashless society should be constructed. This is the most dangerous type of thinking when discussing a cashless society because we are at a critical nexus that will define our relationship with money in the cyberspace frontier. Either we respect individual financial privacy or we restrict it and pave the way for an even more frightening and suffocating vision of the future.

Quoted on the Bitcoin Forum,Vili had this to say:

"I am fascinated by Bitcoin, and I also think I have something of value to contribute to the Bitcoin community. The first is that as a researcher, I have studied payment and digital currency design and user adoption issues, and I think this is an area where the Bitcoin ecosystem could do better. The second is that as a long-time member of Electronic Frontier Finland, I have spent a lot of time thinking and publicly debating about privacy and digital freedom issues. I am worried that Bitcoin is a step too far as it leaves no possibility for even democratic governments to enforce their laws. This is a topic I would love to debate with the community and hear opposing views. I think the end result could be a better understanding for me, but also a better understanding for the Bitcoin community on how to live in harmony with democratic authority."

In the co-authored 2010 landmark paper, "A New Frontier in Digital Content Policy: Case Studies in the Regulation of Virtual Goods and Artificial Scarcity", Vili Lehdonvirta states:

"The law has commenced its long course to recognize digital goods as a form of property. One finds it in court decisions concerning the interpretation of criminal law and related damages. The behavior of gamers and other online users has, both in quantity and quality, exceeded the limits of contract law (Fairfield 2008). Other areas of law, including but not limited to those of criminal law, law of damages, defamation, and law of property, will slowly step into play. But the natural inertia of law can sometimes be a good thing in creating the rules that shape behavior (Bohannan 1965)."

For the most part, I respect Vili Lehdonvirta's academic work on virtual goods ownership, but he harbors confused thoughts on the broader acceptance of bitcoin through dilution of its most beneficial properties, because he mistakenly extends the notion of virtual goods legal recognition to virtual currency legal recognition. While this might be appropriate for a virtual currency that evolved out of a virtual commodity within a proprietary gaming environment, it is wholly inappropriate for a decentralized P2P cryptocurrency that does not depend upon physical property rights for its valuation. 

Lawyers' Take On Bitcoin Regulation

Just as the economics profession, the legal profession is still struggling to catch up with bitcoin. I expect much more detailed legal research in the coming months. One of the lawyers in the forefront, John William Nelson, had this to say in his article, "Extending real-world laws to virtual worlds is a terrible idea":

"Government regulation, either directly or indirectly by forcing common law theory into a virtual world setting, will destroy the ability of virtual worlds to create these fundamental characteristics. The game conceit—the imaginative construct upon which the world is based—will, as Dr. Bartle says, 'evaporates upon contact with . . . reality.' The world will no longer be free to evolve—its evolution will be constrained by the laws injected into its sphere. The world’s support for the hero’s journey will be conditional upon the rules and regulations of laws from the outside—laws from the real world."

In a follow-up piece, "Bitcoin Isn't a Security", Nelson also concludes that bitcoin in-and-of-itself is not a security that can be regulated under U.S. federal securities law:

"But if currency can be a security, then Bitcoin is a security because it’s a type of currency, right?

Wrong. Bitcoin is not really a type of currency, at least not of the type recognized as securities. No entity or assets back up Bitcoin value. Bitcoin value is entirely virtual—a Bitcoin is only worth what another person thinks its worth. This is different than currency issued by countries.

A country’s currency is backed by that country’s government. This backing can either be by fiat (government regulation or law) or by commodity (such as the gold standard the U.S. used to use). Some compare Bitcoin’s value to the value of fiat money, because like fiat money it is not backed by a commodity, but this is where the similarities between Bitcoin and fiat money end.

Bitcoin is backed by no entity, no commodity, no organization. Bitcoin value is not based on government regulation or law mandating its use in a country. Similarly, it is not backed by a whole bunch of gold sitting in Fort Knox."

In answering the question of whether bitcoin investors should worry about securities regulations or laws, Nelson emphasizes that securities law is generally broad enough to capture any enterprise where investment for profit is involved, because a common economic scheme exists where a profit is expected based on the efforts of a third party. In "Bitcoin Isn't a Security", Nelson states:

"Bitcoin investors should absolutely worry about securities laws. The securities definitions outlined above might not apply to Bitcoins themselves, but they are flexible enough to apply to Bitcoin exchanges that convert a Bitcoin to real-world currencies. Securities law might even apply to exchanges converting Bitcoin to other virtual currencies such as Lindens."

Ultimately, laws erected to protect the State's coveted monopoly over the issuance of money will not be slayed through a minor technicality nor will bitcoin suddenly be blessed by a newly-converted regulatory regime. At Yale Law School, Reuben Grinberg writes in "Bitcoin: An Innovative Alternative Digital Currency":

"Most importantly, Bitcoin currently operates in a legal grey area. The federal government’s supposed monopoly on issuing currency is somewhat narrow and statutes that impose that monopoly do not seem to apply to Bitcoin due to its digital nature. However, a bitcoin may be a 'security' within the meaning of the federal securities laws, subjecting bitcoins to a vast regime of regulations, including general antifraud rules. Furthermore, other legal issues that have not been analyzed in this paper are probably significant, including tax evasion, banking without a charter,  state escheat statutes, and money laundering."

The great promise of a nonpolitical bitcoin lies in what its decentralized nature immune to shutdown actually enables – the ability to maintain financial privacy and to transact with entities that may be despised by the government.

This article was also reprinted by the Ludwig von Mises Institute of Canada and Center for a Stateless Society. 

For further reading:
"Why the quoted price of Bitcoin doesn’t matter", Blogdial, October 17, 2011
"WikiLeaks and the protect-ip Act: A New Public-Private Threat to the Internet Commons", Yochai Benkler, September 15, 2011
"Precursors to Bitcoin legislation emerge", Blogdial, September 2, 2011
"On the virtual money?", Charis Palmer, Banking Review, August 7, 2011
"Bitcoins are Baseball Cards", Blogdial, August 3, 2011
"Bitcoin: A Bit Too Far?", Edwin Jacobs, Journal of Internet Banking and Commerce, August 2011
"Innovation and Legal Panic—Bitcoin", Joseph Skocilich, June 27, 2011
"Is Bitcoin Legal?", TechnoLlama, June 16, 2011
"Bitcoin exchanges offer anti- money-laundering aid", Reuters, June 15, 2011
"The Coming Attack On Bitcoin And How To Survive It", Anthony Freeman, June 7, 2011
"Money Transmitter Legislation and Bitcoin’s Legal Status", Bitcoin Money, June 2, 2011

Switchpoker Adds Bitcoin as Deposit and Withdrawal Method

Press Release
via Marketwire
Tuesday, November 22, 2011

http://www.marketwire.com/press-release/switchpokercom-adds-controversial-virtual-currency-bitcoin-as-deposit-withdrawal-method-1589809.htm

World's First Real Money Poker Site for Apple Mobile Devices is First to Offer Revolutionary Online Virtual Currency Bitcoin
 
DUBLIN, IRELAND (Marketwire) -- Switchpoker.com, the world's first real money online poker site compatible with the iPhone, iPad, and iPod Touch, today announces it is the first real money poker site to offer the revolutionary virtual currency Bitcoin as a deposit and payment method.

Bitcoin is a distributed currency that operates without any central point (such as a bank) and without any governmental control. It is very much like gold is in the offline world. Bitcoins can be exchanged from one person to another directly, anonymously and without fees. 

It has proved controversial due to its decentralized nature and the inability of governments to track its use. It has already attracted the negative attention of the Chinese government, the CIA, the US government and many lobby groups around the world. 

Conor McCarthy, spokesman for Switchpoker.com, said, "The advantage of the Bitcoin currency is that it has the ability to remove all payment processing related barriers of entry for poker and gambling sites around the world. It would allow any person to play for real money completely anonymously. 

"Players will be able to now send us funds directly without a 3rd party being privy to the transactions, and we will be able to send funds directly back to the user. It also means that people without a Skrill or Neteller account will be able to play. Players can get Bitcoins on sites such as Bitcoin247.com"

Switchpoker.com, launched in October 2010, offers a simple web-based solution to online poker players who wish to play their favourite games on the move - no download is required, simply visit Switchpoker.com using your mobile Apple device, sign up for an account and start playing immediately.

Switchpoker.com can be played by anyone over 18-years-old with an iPhone, iPad, iPod Touch or using standard web browsers including Internet Explorer 8, Internet Explorer 9, Firefox, Chrome, Safari or Opera.

Switchpoker.com is not currently available to U.S. residents.

About Switchpoker.com

Switchpoker.com is the world's first real money online poker site for use with iPhone, iPad, and iPod Touch mobile devices. The software company which developed the platform used by Switch Poker was formed in Ireland in 2010. 

Contact Information:
Poker Media Consulting
Brendan Murray
+353863057469
Brendan.murray@pokermediaconsulting.com
www.Switchpoker.com 

Why Facebook Never Built P2P Credits Payments

I have always maintained that a 'true' virtual currency will have at least three attributes: two-way convertibility, floating exchange rate, and privacy (or anonymity). Any currency without those attributes is merely an extension of the existing payment structure or a surrogate currency like a glorified coupon. There are some strong legal reasons for companies electing not to support those attributes, including regulation as a US-based licensed money service business and strict AML (anti-money laundering) guidelines. In writing for TechCrunch, Josh Constine explains why Facebook doesn't allow its Facebook Credits virtual currency to be used for person-to-person payments:

"But why hasn’t Facebook built its own way for friends to send money to each other using its virtual currency Credits? Because of significant fraud risks and its focus on making Credits work better for virtual goods purchases where it earns 30%."

"The primary reason Credits can only be spent in games and apps, not sent to other users, is fraud. There are several ways for users to earn Credits instead of paying for them, such as completing on-site offers, or making off-site purchases that are incentivized with Credits rewards through companies like ifeelgoods. If users could transfer Credits to someone else, the occupation of 'Credits Miner' would emerge. These people would earn Credits any way they could and sell them to others for more than they cost to earn but less than Facebook sells them for. This would essentially create a secondary market for Credits and undermine Facebook’s ability to make money on them."

Mining for 'credits' is not necessarily a bad thing and it can tend to increase the overall demand for the nonpolitical currency unit. The so-called fraud (or unfair profit) can always be addressed by floating, rather than fixing, the exchange rate for Credits in the way that Linden Labs has done for the economy of Second Life. Constine correctly hints that the close partnership between PayPal and Facebook is what prevents Facebook from entering the payments business directly:

"To be competitive, Facebook would only be able to take a few percent on transactions, and still it wouldn’t have the base of merchants PayPal cultivated through eBay. Instead, Facebook is focusing on Credits as its platform’s mandatory virtual goods payment processor for developers, where it earns its juicy 30% cut. That business is growing thanks to gaming giants like Zynga, so there’s no need to move into a risky sector such as P2P payments that’s outside its core competencies and dominated by incumbents."

While I believe that to be true for the moment, if Facebook were to address the fraud issue and the legal and regulatory issues of two-way convertibility, it would have an enormous opportunity that PayPal would not -- the ability to create currency at will and earn seigniorage.

For further reading:
"Virtual Currencies, Real Potential", Keith Button, Bank Technology News, November 1, 2011

Alan Szepieniec Presents Bitcoin at Polish Mises Institute

In a step ahead of their U.S. namesake, the Polish Ludwig von Mises Institute hosted Alan Szepieniec to present bitcoin during the 2011 Summer Seminar in Warsaw.



Some of the more recent Mises Institute discussion surrounding the decentralized cryptocurrency bitcoin and its Austrian detractors can be found here and here.

Another notable video presentation was given at DEFCON 19: "Hacking the Global Economy with GPUs or How I Learned to Stop Worrying and Love Bitcoin".

Also, watch Jeffrey Paul presenting Financing The Revolution @ Chaos Communication Camp.