Major Banks and Credit Cards Freaking Out Over Bitcoin – Shut Down TradeHill Exchange

Looks like the fascist looting class finally wised up about the threat Bitcoin poses to their monopoly privilege of debt/money creation.

From BetaBeat.com:

Established banks and payments processors are skittish about the cryptocurrency Bitcoin, it would seem, prompting Canadian e-payments service Paxum to drop its Bitcoin clients last week.

Paxum, an e-commerce payments solution popular with adult web sites, started working with Bitcoin exchanges more than a year ago. Paxum hooked up with leading Bitcoin exchange Mt. Gox in December 2010, major Bitcoin exchange Tradehill in July 2011, and more recently with BitInstant, a service that speeds up Bitcoin transactions by fronting customers the credit, and others.

But on Friday afternoon, the operators of Paxum’s Bitcoin-related accounts received an email with the subject line “Bitcoin termination.” Paxum’s banking partners, which include MasterCard, had called off the Bitcoin party.

Paxum pulling the plug ended up forcing the TradeHill exchange out of business:

Effective immediately TradeHill will be shutting down trading / deposits and returning all client funds. Due to increasing regulation TradeHill can not operate in it’s current capacity without proper money transmission licensing. Combined with multiple bank account closures and Paxum’s decision to close all Bitcoin business accounts, we have deemed the best course of action is to halt trading and pursue licensing while raising funds. SEPA transfers for our Euro customers have been enabled.

TradeHill’s banking partners seized a hundred grand of their funds without notice and without reason.  TradeHill is currently seeking relief through the court system, but I suspect they are going to get crapped on by the powers-that-be.

Mt. Gox is based in Japan, so I think the fascist oligarchs are going to have a more difficult time derailing that exchange.  But it doesn’t really matter one way or the other, because should Mt. Gox get knocked off line, another exchange provider in a different country will simply step up to take its place.  (I would like to add that Intersango has requested that former TradeHill customers check them out.  They are an exchange operated by Bitcoin developers.)

Further, Bitcoin prices in US Dollars can be calculated by proxy.  For example, if we know what the Pound Sterling is worth in comparison to the US Dollar, and we know what Bitcoin prices are worth in comparison to Pound Sterling, its a simple calculation to arrive at what Bitcoin prices are worth in terms of dollars.   This information allows people to purchase Bitcoins without any US Dollar exchange in operation at all.  People could simply buy them on message boards using money packs, paypal, cash, etc.. etc.. There are dozens of ways to get Bitcoins that don’t involve going through a major exchange.

While it is unfortunate that TradeHill was looted by fascist thugs and forced to shut down by criminal banking enterprises, at least we can say they are clearly scared of what Bitcoin represents.

Freedom.

  • http://profiles.google.com/justindkeith Justin Keith

    People really need to start working on decentralized exchanges (yes I know Bitcoin OTC technically qualifies), but I’m thinking more in terms of web-of-trust; something like Ripple Pay running on Bitcoin.