
The World's Biggest Wealth Manager Won't Touch Bitcoin - pdog
https://www.bloomberg.com/news/articles/2017-11-17/ubs-shuns-bitcoin-allocations-due-to-threat-of-crypto-crackdown
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Snackchez
>“All it would take would be one terrorist incident in the U.S. funded by
bitcoin for the U.S. regulator to much more seriously step in and take action,
he said. “That’s a risk, an unquantifiable risk, bitcoin has that another
currency doesn’t."

You can't make this up... or maybe I'm not understanding something. So, what's
currently funding terrorist attacks?

~~~
nxsynonym
I don't understand the comment either.

It's not like terrorist groups are currently un-funded. Cash is still king
around illegal activities of all kinds. Why is using bitcoin for illegal
activity any different than untraceable cash?

~~~
iamthirsty
Your points are valid, but I think you're misunderstanding his point. If a
terrorist attack happened that was funded via Bitcoin, and could've _only_
been funded via Bitcoin (including a false-flag) the governments would throw
the book at it. This could be terrorist groups sending BTC to legit US
citizens who purchase things (like weapons) legally and then use them in an
attack, &c.

~~~
mikeash
The "could've only been funded via Bitcoin" part isn't even necessary. The US
government is kind of crazy when it comes to terrorism. Any connection between
Bitcoin and terrorism that gets a lot of public attention is likely to result
in major legal problems. It doesn't matter whether or not the fear is well
founded or whether Bitcoin's role was incidental. Look at how much pressure
there is to crack down on encryption in general, and that would have far
wider-reaching consequences than regulating a cryptocurrency only a tiny
percentage of people actually use.

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jwilliams
I'm glad to see this, but I don't think the content is particularly on point
(or compelling really).

A large amount of Bitcoin reporting at the moment is grossly irresponsible.
This "Bitcoin will be $1M each" is fueling bad decision making on the part of
the ordinary punter.

Right now there is a major civil war in the Bitcoin camp (BTC vs BCH). It's
playing out as we speak. Whatever your horse in that race, it's extremely
volatile. Not only that, there are other tokens, shady ICOs, exchanges with
suspect resilience.

It's also impossible that your on-the-street investor can be informed enough
to make a good choice. This is really concerning.

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sebleon
Makes sense - government could instantly prevent BTC from gaining mainstream
adoption as a currency. Unclear how price would move if BTC was only used for
store-of-value only.

In Venezuela, people go to jail under treason laws if they get caught mining.
[1]

[1] [https://www.cnbc.com/2017/08/30/venezuela-is-one-of-the-
worl...](https://www.cnbc.com/2017/08/30/venezuela-is-one-of-the-worlds-most-
dangerous-places-to-mine-bitcoin.html)

------
XR0CSWV3h3kZWg
> Bitcoin has also not reached the critical mass to be considered a viable
> currency to invest in, UBS’s Mark Haefele said in an interview. The total
> sum of all cryptocurrencies is “not even the size of some of the smaller
> currencies" that UBS would allocate to, he said.

> “All it would take would be one terrorist incident in the U.S. funded by
> bitcoin for the U.S. regulator to much more seriously step in and take
> action, he said. “That’s a risk, an unquantifiable risk, bitcoin has that
> another currency doesn’t."

These two taken together seem to paint two very different pictures for
bitcoin.

1) Bitcoin makes it past the point where a couple singular bad acts pushes
governments to crush it. Bitcoin sheds almost all of the value that was there
as speculation. Value potentially crashes all the way down to ~1USD, prices
before mtgox trading really started. Bitcoin continues to run, more and more
over encrypted channels or TOR. Mining is prosecuted and only done in some
states, or clandestinely (see mining in Venezuela). Bitcoin continues to be
used on the dark markets of the internet.

2) Bitcoin is adopted by wallstreet, action against bitcoin is prevented and
tempered by lobbyists with deep pockets. Price increases dramatically.

Either future is amazing to me. Either gritty cyberpunk or vanilla sci-fi.
Glad to see this happen in my lifetime.

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tomelders
If you want some sort of idea about how little UBS understands modern banking
and wealth management, take a look at UBS Smart Wealth.

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kown223
It is a fair point but you can't buy bitcoin these days without kyc, not to
say the IP trace, if they can break tor/proxies and access exchanges records
they can "follow the bitcoins", but then again how much funding you need, in
EU recently there were quite a few attacks where they just rented a big truck
and ran over people, also the bomb in the airport, they made it from some
cheap chemicals, and then took a cab.

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Kiro
> Still, CME Group Inc., the world’s largest exchange owner, has said it plans
> to introduce bitcoin futures by the end of the year, citing pent-up demand
> from clients. That pushes bitcoin closer to the mainstream by making it
> easier to trade without the hassles of owning the currency directly.

What's the difference between that and CFDs on eToro?

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pdog
_> How do you know when to get out of a bitcoin investment?_

That's the thing. When Bitcoin succeeds, you won't have to get out of the
investment.

~~~
imustbeevil
If the best case scenario is Bitcoin hits $1,000,000 per coin and never moves
again, why would anyone ever put more money into it?

The only value Bitcoin has is appreciation. If it ever becomes stable it will
necessarily be worthless.

~~~
corporateslave6
this isnt true, when countries have massive instability and currency
manipulation (see Zimbabwe), people can buy bitcoin as an alternative store of
value.

~~~
grandalf
To some extent, even stable currencies suffer from significant manipulation by
governments. This is not a tinfoil hat idea, it's generally why non-corrupt
central banking helps achieve social stability.

But central banking is a large hammer, and so even in the US there are many
uses of currency where Bitcoin shines. Also, over time no central bank has
managed to avoid some form of corruption (this is concerning both for fiat and
centralization-prone cryptocurrencies like Bitcoin).

But the factors that lead to corrupt central banks are not primarily monetary,
they are social/societal, causing those banks to bend to the whims of some
interests while ignoring others.

The interesting thing to observe will be how/whether Bitcoin can adapt its
broader organizational structure to make it less vulnerable to these forces of
"bad" centralization. Also, if trends continue, the risk-takers of today who
own Bitcoin may well be the wealthy influencers of tomorrow and may not take
kindly to some of the sensible changes.

There are many, many ways in which Bitcoin is far superior to the typical fiat
+ central bank system, though, most notably its international nature. Even if
Bitcoin's ability to avoid problems is only 90% as effective as the most
effective fiat systems, that is a tremendous improvement for most of the
people living on Earth.

~~~
AnimalMuppet
One of the things the better fiat currencies have is stability of value.
Bitcoin (at least so far) has failed rather dramatically at that. It's been
mostly up so far, which makes many people willing (even eager) to accept the
lack of stability, but it definitely hasn't been stable.

~~~
grandalf
Very true. It's interesting to think of what you describe as a side-effect of
the design decision (by Satoshi) to "bootstrap" the currency by strongly
incentivizing speculative mining.

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PatientTrades
The key aspect of Bitcoin is that buyers/sellers can operate anonymously. Once
governments regulate Bitcoin and makes the anonymous nature illegal, Bitcoin
will crash and be essentially useless.

~~~
AnimalMuppet
No, it will just be illegal. It will still be useful for those who are willing
to be illegal.

The trick for the government will not be creating regulations or prohibitions.
The trick will be enforcement.

