Tuesday, February 14, 2017

Bitcoin exchanges miss important technology

U.K. Banks Shun Bitcoin
A dozen or more U.K. brokerages and bitcoin exchanges have suffered over the past three to four years as banking facilities have become unavailable. Some have closed or resorted to awkward arrangements.
Britcoin, which became rebranded as Intersango, started in 2011. It faced problems with U.K. bank transfers before eventually closing. An August 2012 update noted that bridging the gap between bitcoin and the conventional banking system was costly on account of technical issues, missing transfers, and accounts frozen and closed without warning.
In 2014, Bit121 had a promising start, but banks withdrew their support and the exchange closed.
In Bitcoin We Trust suffered the same fate. It resorted to using postal orders before giving up.
Coinfloor, one of the only U.K. exchanges still operating, uses SWIFT transfers, which incur hefty costs and delays. The minimum transfer is £1,000 (c.$1,250).
Banks are required by law to offer currency insurance backed by  the taxpayer.  It is socialism for the wealthy courtesy of monotenarians.

Bitcoin exchanges need S&L functionality if they want to move beyond central bank hedging.  Share the currency risk, become  a shadow bank.

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