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PayPal's history suggests that the problem of Bitcoin fraud will only get worse as the electronic currency gains momentum.
February 27 -
Don't think of it just as currency or a new set of payment rails. To get a full sense of Bitcoin and its implications for banking, you have to think bigger than that.
February 25 -
The Consumer Financial Protection Bureau has taken a different -- and more comical -- approach in getting the word out about its new mortgage rules, including an appearance on The Daily Show With Jon Stewart.
January 10
WASHINGTON Comedy Central's Jon Stewart had some fun at the expense of Bitcoin and big banks Thursday night, suggesting pejoratively how the digital currency could take a page from the textbook of more established financial institutions.
Stewart did his take on the collapse of the Bitcoin exchange Mt. Gox, which went offline amid the apparent loss of over 740,000 bitcoins and suggestions of fraud.
"What is Mt. Gox, other than the place in a Dr. Seuss book where a Fox and a Drox share a Home in a Box?" he said on The Daily Show with Jon Stewart.
Stewart was relentless in badgering Bitcoin, suggesting maybe the exchange's lost money could be found in the Trash directory of its computer desktop. He compared the virtual currency to once-popular digital pets that owners could keep on their keychain.
Bitcoin "only exists online. It is the tamagotchi of currency," he said. "That reminds me: I should feed mine. I got him 12 years ago. ... I wonder how he's doing."
He later acknowledged the real acronym for the Mt. Gox exchange is "Magic: The Gathering Online eXchange", in reference to the exchange's original purpose of being a marketplace to trade cards from the Magic: The Gathering game.
"It started out as a place to trade Magic cards? So did my basement. Does that mean my basement is now a currency exchange?" Stewart said.
The comedian joked that Mt. Gox's demise is counter to how more mainstream institutions such as Credit Suisse and Goldman Sachs handle their dubious episodes.
"Listen, Bitcoin exchange, you've got a lot to learn about being a financial player. You don't just commit brazen fraud in one fell swoop. You institutionalize and normalize systemic fraud," Stewart said.
He pointed to recent reports of Credit Suisse allegedly going to great lengths to help wealthy Americans hide money from the Internal Revenue Service overseas.
"Your brazen Bitcoin fraud means that you will spend your days hunted down by every international high-tech law enforcement agency known to man," Stewart said. "Meanwhile, if you had institutionalized your corruption, this would be the penalty you'd face." The program then showed footage of Credit Suisse CEO Brady Dougan simply reading testimony before a Senate committee.
Stewart added that Bitcoin-related businesses should also look to how Goldman Sachs is making waves. The show referred to reports of the investment bank's uranium positions. "Goldman Sachs is going to have a nuclear weapon before Iran!" he said.
Footage also included scenes of big protests in Denmark, where citizens are opposed to Goldman's investment in Dong Energy, a state-owned utility. In contrast, the program then showed only two protesters demonstrating against the Mt. Gox losses.
"You know you've made it as a corporation when the majority of a country is willing to brave sub-zero temperatures to keep you out of its country when you haven't even done anything yet," Stewart said. "Are you there yet, Bitcoin?"
