Hacker News Reader

Comment by mtgx | Hacker News Reader

I'm not arguing over what they're doing, the guy was asking for it, but it seems someone at a high level asked for more regulation and attention on the Bitcoin ecosystem.

View on HN

As was demonstrated, Ponzi schemes are already illegal, regardless of denomination.

No new laws or regulations required.

99% of the time in the USA, blatant fuckery is already illegal six ways from Sunday. The last thing we need are more laws.

Are they? What about in video games? Eve Online had a gigantic ponzi scheme where players stole vast amounts of in-game currency. Is that illegal? I'm not being snarky, I genuinely don't understand when it is and is not illegal.

AFAIK EVE has a TOS saying that everything that happens in the game is fictional and that ISK is not real money. Essentially all players have waived their right to complain, although it might be possible for a court to overrule that.

I think plenty of Bitcoiners were trying to have it both ways, telling the IRS and SEC that Bitcoin is not real money while cashing out their schemes on MtGox at the same time. As with any license to steal, this was too good to be true.

But there are plenty of black market sites where you can convert video game currency to and from cash. It's an extra step, but it's trivial to do. There are even sites that aggregate video game black markets and show the best conversion rates and most trusted services.

Does Bitcoin make it easier to get away with a Ponzi scheme?

If you're some kind of anonymous money-laundering genius perhaps.

Smithers! Have that bozo start up the Tor reactor!

I'm a little bit sad, because this was one of the funnier things I've said in my life.

what happened was his forum passthru cheerleaders that got scammed when his ponzi popped ran screaming to every authority they could and finally somebody at the SEC noticed. Note these same people all trollish extreme libertarians that denounced all regulation until it affected them and they immediately deferred to authority

Doubt it. Pirateat40 was threatening to move anyone who considered legal action to the back of the queue or even drop them altogether, and his cheerleaders seemed to buy into that for the most part.

If memory serves me he tried this stalling tactic for a month or two then just disappeared and even his cheerleaders had to admit it was a scam. Then they found some linkedin info and went after old companies he worked at for info, who were more than happy to tell them what a chronic liar and general weirdo he was to work with. Then the crying to regulators at the SEC began

Most of the PPT operators promoted and profited off of pirate's scam, and should face legal action alongside pirate.

PPT operators did not have an incentive to go after pirate, unless they had also invested significant personal holdings in BS&T, because:

1) They were investing other peoples' money and taking a fee off the top

2) They could face investigation themselves if they went to the authorities.

People wanting to discredit bitcoin would have left this scheme running and would not do anything to prosecute the people involved.

That would make people worried about buying bitcoin because, simplistically, "Bitcoin = scams".

My first thought at this story was that the action serves to legitimise bitcoin as a means of exchange. If the Ponzi scheme had been peanut-denominated, would the SEC have taken action?

Reply on news.ycombinator.com