Russian Bank “My Bank” freezes cash withdrawals day after Russian Central Bank warns on Bitcoin

According to a report on Zero Hedge, “My Bank,” one of Russia’s top 2oo lenders by assets, has suspended all cash withdrawals.


The lockdown is expected to last for a week.

This news follows the recent statement by the Russian Central Bank warning citizens against the speculative and legal risks of Bitcoin.

The Russian Ruble is experiencing downward pressure from the current “risk-off” environment afflicting emerging market economies. It’s possible this currency situation is responsible for the bank freeze.

MyBank shuts down cash withdrawls to prevent a bank run?

My Bank shuts down cash withdrawls to prevent a bank run?

This story, together with the looming problems in the Chinese shadow-banking sector as well as HSBC’s recent bottlenecking of withdrawals and Lloyd’s ATM-withdrawal “glitch,” are all raising red flags regarding liquidity flows in the fiat financial system.

The IMF has threatened 10% wealth taxes and the German Central Bank recently proposed “one-time” levies on struggling Euro members. Even Canada’s Central Bank has proposed a bail-in regime. Cyprus is seemingly to be the template for future “resolutions” of Europe’s banking crisis. Even Canada’s

The global economic outlook has begun to sour in 2014 as the wild money printing experiments of central banks reach their limits. With the real economy sluggish and all efforts at meaningful structural reform blocked by the very financial agencies central to the problem, the seizure of private wealth is likely to be the system’s last resort.

Alternative forms of wealth like Bitcoin and precious metals, which offer people protection against wealth confiscation, are increasingly frowned upon by desperate governments.

While fiat cash remains a necessary evil for the majority of transactions, bank saving accounts represent an inflation-underperforming and increasingly exposed store of value. Very few bank depositors realise that, under current financial laws across many nations, their deposts are viewed as unsecured loans made to financial companies. As global stock markets appear toppy and bonds, the traditional “safe harbour” investment, bleed credibility due to government debt expanding beyond the mathematical possibility of repayment, good investment opportunities are scarce.

While it remains to be seen how Bitcoin price will fare in such an environment, it’s doing well so far despite negative news. Any further banking fiascos are likely to bring a fresh influx of Bitcoin entrants.

source: http://www.cryptocoinsnews.com/2014/01/28/russian-bank-freezes-cash-withdrawals-day-russian-central-bank-warns-bitcoin/

Russian Bank “My Bank” freezes cash withdrawals day after Russian Central Bank warns on Bitcoin

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New Bitcoin Features Revealed by Core Developer Mike Hearn

In a video released by IamSatoshi on YouTube, Bitcoin core developer Mike Hearn has revealed a few different new features that are going to be pushed onto the Bitcoin protocol this year.


There are many different upgrades that need to be made to the protocol to keep it secure, cheap, and stable, and the core developers have been working on a variety of different issues over the past few years. As the Bitcoin network continues to grow, it becomes more important to deal with the kinds of issues that could affect the basic integrity of the Bitcoin protocol. Here are some of the upgrades that Mike Hearn talked about in his presentation at the Coinscrum Networking Evening in London:

Bitcoin Wallets Will Be Standardized

While all Bitcoin wallets are able to talk to each other through the Bitcoin network, there are still some compatibility issues that can pop up from time to time. For example, if you’re trying to export a wallet from one Bitcoin client, it may not work when you try to import it into another. The Bitcoin developers are going to standardize the import and export processes to deal with these kinds of issues in the future. Hearn also discussed the importance of implementing these standards before the upcoming release of the TREZOR hardware wallets.

Attachments on Bitcoin Transactions

The first attachment mentioned by Hearn is a refund address for customers who are purchasing a good or service. Sometimes you don’t want to receive a refund at your original sending address, so this should prevent more lost bitcoins in the future. You will also be able to attach memos or messages to transactions, and receipts will also be implemented to offer some form of proof-of-purchase to Bitcoin users.

Transaction Fees Will Float

The current Bitcoin protocol has a minimum transaction fee, and that transaction fee is priced in bitcoins. This means that it has gradually become more expensive over time. You may have noticed that those nearly-free Bitcoin transactions are not so cheap these days. With floating fees, the market will be able to determine the appropriate transaction fee attached to each Bitcoin payment. Hearn also briefly mentioned the idea of the receiver paying the transaction fee rather than the sender.

Routing Traffic Through Tor

Hearn has written about the current issues when it comes to Bitcoin privacy, and it seems like he’s ready to tackle this lingering elephant in the room. It’s definitely important to prevent the prying eyes of government from seeing which individuals are behind certain Bitcoin transactions, but this kind of upgrade is also needed for general security from hackers and other bad actors. Everything about a Bitcoin transaction should be encrypted, and IP addresses should be masked as often as possible. There are some issues with providing “perfect” privacy with Bitcoin, but Hearn talks about some possible solutions near the end of his presentation.

If you’re interested in the implementation of more secure and anonymous transactions on the Bitcoin payment network, then you’ll definitely want to watch the whole video. Hearn goes into detail about the problems of preventing Sybil attacks when traffic becomes anonymous. After all, how do you know if you’re really talking to different users of the Bitcoin network if there are no true identifiers for the users? While other altcoins are attempting to implement exotic features that can grab your attention right away, the core Bitcoin developers are still focusing on the basic features of a secure payment network. These are the features that make the Bitcoin network more valuable than any of the other cryptocurrencies at this time.

Coinkite Simplified Bitcoin Merchant Integration

Coinkite has made it astonishingly easy to accept and pay using Bitcoins in stores. They have created a system that uses the ordinary merchant terminals, that accepts VISA and Mastercard transaction, to include Bitcoin and Litecoin transactions. It takes probably a few more seconds to pay with Bitcoin or Litecoin on one of the merchant terminals, but Coinkite is into something here. They could manage to lower the “adoption wall” for using Bitcoin as personal payment method.

Coinkite makes Bitcoin Purchases so Simple

Coinkite makes Bitcoin Purchases so Simple

We have earlier discussed that PayPal might start using Bitcoin in some way or the other. PayPal, Google, and VISA have been experimenting with merchant terminals that are using Near Field Communication (NFC) via your smartphone to accept payments and pay for products. This might be the next step for service like Coinkite. To make it even more simple than they have managed now.

View the great video from Coinkite below:

My Bitcoin Concern

After viewing this video I got one concern. A concern that we might be witnessing in action now. Since Overstock.com and Tigerdirect started accepting Bitcoin as a payment source, we have seen a big dip and sell-off of Bitcoins as Gordon Geeko wrote about this morning. Even though we have great news from the Bitcoin community everyday, it seems like the price is turning downwards. The concern I have is the following: If big companies like Overstock.com and Tigerdirect immediately sell all their Bitcoins to convert them into USD, we will most likely have a bigger outflow of USD from Bitcoins than vica versa. More money might be pouring out of Bitcoin than in.

source: http://www.cryptocoinsnews.com/2014/01/24/4-new-bitcoin-features-revealed-mike-hearn/ & http://www.cryptocoinsnews.com/2014/01/24/coinkite-makes-purchases-simple/

New Bitcoin Features Revealed by Core Developer Mike Hearn

Wells Fargo Hosts “Virtual Currency: Viability, Compliance, & Direction”

Last week, here at CCN we reported on Wells Fargo calling a Bitcoin Summit to discuss “Rules of Engagement” for banks and Bitcoin.


This original private summit was held on January 14th, 2014 and was headed by Jim Richards, the Vice President in charge of Wells Fargo’s financial crimes risk management division. Presumably, at the January 14th summit, Wells Fargo and other banking officials saw a greater need for wider dialogue that included the public.

According to this flyer released by Wells Fargo yesterday, Wells Fargo and Buckley Sandler LLP are hosting a Bitcoin convention on January 28th, 2014 in New York City. The public event, titled “Virtual Currency: Viability, Compliance, & Direction” is limited to 60 seats all of which have since been filled. The lucky 60 participants will get to listen to five panelists speak for 10-15 minutes each and then participate in an audience Question & Answer session. The panelists include Margo Tank of Buckley Sandler LLP, Albert Wenger of Union Square Ventures, Jeremy Allaire of Circle Internet, Seetha Ramachandran of the United States Department of Justice, and Fred Ehrsam of Coinbase. The event will be moderated by Wells Fargo’s Jim Richards.

The event has very specific stated goals:

Our panel of experts will weigh in on market trends, investment opportunities, compliance imperatives, and interoperability with traditional fiat currencies. What industries will be disrupted? Which will be enhanced? Particular attention will be given to regulatory compliance, risk management, and policy frameworks.

Whether Wells Fargo officials genuinely are seeking more educated opinions from Bitcoin-involved companies or preparing swift top-down banking regulations behind the veneer of public engagement, remains to be seen.

Wells Fargo and Bitcoin in the past

Wells Fargo, specifically Jim Richards, likely first came in contact with Bitcoin when a joint operation by multiple federal agencies seized 5.5 million USD from a Wells Fargo account owned by Mark Karpeles of Mt. Gox back in early 2013. Money that may or may not have been tied to the infamous Silk Road. From arguably the worst possible introduction to Bitcoin imaginable, Wells Fargo is now positioning itself as a forward-thinking, but still monstrously huge, bank of the people.

Wells Fargo and Bitcoin in the future

Given the long list of pro-Bitcoin speakers represented at Wells Fargo’s event, I have high hopes for this upcoming summit. Even Wells Fargo explicitly allowing businesses that handle Bitcoin to bank with them will have a long resounding effect on Bitcoin and the Bitcoin market exchange rate. Wells Fargo, according to market capitalization, is the largest bank in the United States and happens to be headquartered in San Francisco, an ideal location to capitalize on Silicon Valley’s Bitcoin Infatuation, as INC calls it. The good news is that Wells Fargo clearly recognizes the potential of Bitcoin and does not want to be left behind as the world financial system upgrades. This is in contrast to the anti-Bitcoin stance that some other banks have taken and I hope that any guidance that Wells Fargo comes up for their own branches will be emulated by banks everywhere.

GHash.IO Preventing Accumulation of 51% of all Bitcoin Hashing Power

If you haven’t been living under a rock recently, then you have probably heard about the concern of CEX.io/GHash.IO reaching critical mass and possessing 51% of the total hashrate of the Bitcoin network. Which if came to pass could potentially cause problems for Bitcoin in general. I will not go into what a 51% attack is here, but it is definitely worth learning about if you are at all interested in the future of Bitcoin.

CEX.io Cloud Mining

Well now they have answered our fearful cries, and have put out a press release which explains their intentions of mitigating such a threat. The following is from the release:

GHash.IO, the worlds largest and most powerful mining pool, has entered 2014 with overall hashing power of over 40%, making it the #1 pool currently in the Bitcoin network.

The pool has gained significant hashing power due to the 0% pool fee, merged mining of alt coins, excellent real-time data presentation as well as quality 24/7/365 support service.

The hashing power of GHash.IO consists of:

• ~45% BitFury ASIC based miners

• ~55% independent miners

Although the increase of hash-power in the pool is considered to be a good thing, reaching 51% of all hashing power is serious threat to the bitcoin community. GHash.IO will take all necessary precautions to prevent reaching 51% of all hashing power, in order to maintain stability of the bitcoin network.

We have put a plan in place to see that 51% of all hashing power, will not be maintained by Ghash.IO by executing the following actions:

• We will temporarily stop accepting new independent mining facilities to the Ghash.IO pool.

• We will implement a feature, allowing CEX.IO users to mine bitcoins from other pools. So when they purchase GH/s they can put it towards any pool they choose.

We will not be implementing a pool fee, as we believe the pool has to remain free.

GHash.IO does not have any intentions to execute a 51% attack, as it will do serious damage to the Bitcoin community, of which we are part of. On the contrary, our plans are to expand the bitcoin community as well as utilise the hashing power to develop a greater bitcoin economic structure. If something happened to Bitcoin as a whole it could risk our investments in physical hardware, damage those who love Bitcoin and we see no benefit from having 51% stake in mining.

source: http://www.cryptocoinsnews.com/2014/01/24/wells-fargo-hosts-virtual-currency-viability-compliance-direction/ & http://www.cryptonerd.co/

Wells Fargo Hosts “Virtual Currency: Viability, Compliance, & Direction”