Category Archives: Uncategorized

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Why Bitcoin is Better Than Gold

Category : Uncategorized

Bitcoin (sometimes called "digital gold") has been more stable than gold for the last twenty-four days according to this Wall Street Journal article. The article points out that:

Some point to the drop (sic. drop in volatility) as a sign that investor perception of bitcoin is drawing closer to gold as a safe store of value.

So it appears Bitcoin may be finally catching on in the mainstream (though it has already performed as an alternative safe haven to a limited degree in some previously collapsing economies such as Cypress, Greece and Argentina). But as the global Bitcoin exchange infrastructure and liquidity have improved tremendously since those crises, Bitcoin now has practically instant global liquidity. Bitcoin's ability to settle accounts globally in minutes compared to physical gold needing a physical, expensive and risky shipment to do the same makes it a hands down winner in my opinion and that gap will only widen as Bitcoin becomes even more mainstream. 

The phrase "safe haven" is used to describe the flow of stored value from a perceived risky type of money into a perceived safer one. Perhaps one of the best resources to investigate the risks associated with current money systems is Jim Rickards. Author of two best sellers with dire predictions on the current money system, Rickards says something in this video with Greg Hunter I never heard him admit before. Rickards has always talked about IMF Special Drawing Rights being a candidate to replace the current fiat currencies of the sovereign countries. In other words, Special Drawing Rights are being proposed as a global fiat money system. What Rickards says in this interview is that he doesn't believe that the general public will fall for the trick again (the "trick" being the ability to create money out of thin air). What he ends up predicting is a return to a gold-backed currency and spends quite a bit of time speculating about the price that gold would need to be pegged to in order to avoid massive inflation or deflation. 

Bitcoin has no such pricing problem as it is an instantly self-adjusting and global market already in place. Rickards' proposed solution of pricing gold by governments totally ignores free market principles. With wide-spread belief that the governments already manipulate the gold price, he seems to believe that they will forget government price fixing schemes done with gold?  Another problem with Rickards proposals is when he suggests a type of "fractional reserve" gold backing of a currency where the government only needs to back a percentage of the printed money. I would think the now enlightened public would see through that scam and realize nothing would prevent a government from exceeding the legislated backing requirements. Governments could "cheat" at will, print as much fiat as they wanted and would capitulate when a "bank run" occurred when the public rushed the banks to get their gold. In other words, Rickards seems to be proposing a return to the mistakes of the past. Rickards also derides digital currency's potential problem of being hacked or lost through hardware failure which seems to indicate a certain level of ignorance on his part of how to prevent hacking ( perhaps a generational issue shared with Hillary Clinton) and how to backup critical data. But with all his misgivings about these potential losses he proposes a limited gold-backed currency so that it could retain the advantages of being digital. His proposal surely falls far short of the already established accountability and security of Bitcoin.

But back to the Wall Street Journal article … suppose Bitcoin is, indeed, on its way to becoming an alternative to gold? A visit to the World Bitcoin Network's Bitcoin Price Model and an adjustment to the gold setting there results in a Bitcoin price of an astounding $ 33,710.30 if Bitcoin is chosen as an alternative to just 10% of the current gold market! Ten percent is NOT that a large a market share to be beyond possibility especially if we consider that the demand for "safe havens" may be increasing. As it does increase Bitcoin simply could become the "safe haven" of choice among the new entrants and Bitcoin's market share would keep increasing. Here is the screenshot of the results of setting Bitcoin at a level of 10% of that of gold…

Screenshot from 2016-04-19 14:12:16



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The Gold VS. Bitcoin Debate

Category : Uncategorized


I often approach a discussion about Bitcoin by trying to learn where the other party is in their understanding of economic principles. The debate about what constitutes 'good money" goes all the way back to Aristotle (if not earlier) and it is safe to assume that the listener has not fallen as deep into the rabbit hole of economic theory as I have. During my three years of quite significant involvement with Bitcoin I've been exposed to many presentations comparing Bitcoin to fiat money (i.e. cash), credit cards, remittances (i.e. Western Union et. al.) and, of course, gold.

One of the most used ideas defending gold is that it is tangible and that you can hold it in your hand. While a part of me sees the wisdom of thta position I also see a looming pitfall in that it cannot be transferred easily nor inexpensively. This article goes further dealing with that difficulty than I ever have and concludes it (sic. gold) is essentially an abosolete relic from another age when it comes to being used as currency. The writer got plenty of flaming comments from gold lovers and the fact that gold is tangible seems to be a major theme among them. I found the comments as interesting as the article as they show a large variance in the understanding of the commenters when it comes to all the economic, historical and technological issues. The thought occurred to me that we may have to add scienctific knowledge into the mix because the idea of Bitcoin and digital currencies need of using "electrons" came up as a detriment but gold is as dependent on electrons as Bitcoin as is life itself. I left a comment there myself.

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Justice Department Disingenuous About Apple and Terrorism

Category : Uncategorized

It would seem that the U.S. Justice Department has been very far from honest when it represents that anti-terrorism is the reason they want Apple to create a "backdoor" into the I-phone. According this Wall Street Journal article there are twelve other cases that the Justice Department  is pursuing against Apple and in each one they are attempting to use the archaic 18th-century law called the All Writs Act to compel Apple to comply.

The letter, written last week from an Apple lawyer to a federal judge, lists the locations of those phone cases: Four in Illinois, three in New York, two in California, two in Ohio, and one in Massachusetts.

The problem regarding the Justice Department's hones representation of the situation to the American people is that NONE of the twelve cases involve national security. This is obviously a case where one of the highest regulatory agencies in the country stooped to the level of "crying wolf" for other reasons, as yet unknown. Their behavior warrants an investigation into the workings of the Justice Department itself. Are their motives the results of corruption? Do its leaders have stock options on Apple's competitors? Have they bet against Aplle shares (called selling them "short")? I struggle for a legitimate reason for such behavior.

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About The “Network”?

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The website is just one website within a co-operative network of websites but is, itself, a network of websites by virtue of using the WordPress MS (multisite) platform. WordPress MS enables users to get their own website/blog as a subdomain under the main site (like To get yours simply register.

Or, you can register and get a blog at any of our other WordPress MS sites:

Each node and “sub node” in the network (whether they be a WordPress MS site, a regular WordPress installation that uses our plugin or a PHP driven website) hosts our web directory API which creates a fully populated (with categories,links, titles, descriptions etc.) Yellow Pages style web directory on the site.

This network of interconnected Yellow Page style web directories enables a web site looking to advertise themselves to register at just one site, add their link information and description and have that listing dispersed among the entire network. The number of sites the listing is displayed on will increase, too, when new websites join the network and they, too, start displaying the ads.

What incentive do we provide a web site operator to install our API? First, nodes receive permanent, perpetual income from the advertising sales that their node generates. Since an advertiser gets their listing displayed in the entire network, and since that advertiser is in a competitive bidding situation for their listing position, the amount of income they receive is market driven. Second, since every advertiser owns and operates a website they are potentially a new node and if that happens then the site where they registered at originally gets permanent, perpetual override commissions on all of the sales the recruited site generates.

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What Is An “AdCoin”?

We use the term “AdCoin” to describe the value held in our customers’ and members’ accounts which originated from a Bitcoin deposit and that also preserves and backs that value 100% with Bitcoin because they (sic. AdCoin) are redeemable for Bitcoin at a fixed one-for-one exchange rate.

Why don’t we just call them Bitcoin then? There are a few reasons, among them is that it helps train users about and reinforce the adage about Bitcoin that “if you don’t control the keys you don’t own the Bitcoin”. For the sake of clarity and accountability we change the name of this new asset that the user has control over to “AdCoin” instead of using the name of the former asset they no longer have control over (i.e. Bitcoin).

AdCoin is NOT an altcoin despite the fact we use the word “coin” in its name. We use the word “coin” mostly to keep the user reminded that they are all redeemable 100% for BitCoin. There are concepts used around Bitcoin developer community such as “sidechains” and “tokens” which perhaps come closer to describing what an AdCoin is but the differences between them all are subtle and probably of little interest to our casual user.

To help differentiate our concept we regularly substitute either of the names “ad credit” or “advertising credit” for AdCoin. The three (AdCoin, ad credit, advertising credit) are synonymous and are ALL backed 100% with Bitcoin on a one-for-one exchange rate.

So … at the end of it all … AdCoin are really just the name sometimes used for account ledger entry values.

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Bitcoin Is A Black Box To Many Government And Tax Regulators

Category : Uncategorized

Earlier this week, the European Court of Justice decided to exempt bitcoin transactions from Value Added Tax (VAT). The IRS in the US made its ruling on Bitcoin way back in March of 2014. The European ruling has been heralded as good news for Bitcoin while the IRS ruling was not so welcomed.

The point is that governments across the globe have still not reached any type of consensus as to what, exactly is Bitcoin and how to treat it. And all this confusion in governments is happening when the introduction of Bitcoin was over 6 years ago.

That is because there has never been anything like Bitcoin before. The governance of current financial assets evolved when those assets were first, commodities such as gold or silver and later became debts recorded on paper. The computer but even more the Internet made the debt and paper model untenable. Only 3% of US currency is represented as paper “dollars” meaning only 3% of the money issued has any unique identifier attached to it (i.e. the serial number of the Federal Reserve Notes). The remaining 97% of currency has no such unique identifiers and, so, can be created ad infinitum.

Trying to make a mathematically and technology superior system such as Bitcoin match up with such a corrupt and irrational system as what the world governments now operate is an impossible task for regulators.

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