GoldMoney’s James Turk has released an interview with Félix Moreno de la Cova discussing currency competition and the pros and cons of Bitcoin and digital gold currencies.

Félix explains the working mechanisms behind Bitcoin, which is a digital currency. He talks about the decentralised Bitcoin protocol, which is the DNA of Bitcoin and assures that bitcoins will not be double-spent. He states that Bitcoin can’t be shut down unless the whole internet gets shut down.

They discuss the differences, but also the similarities between Bitcoin and digital gold currencies. James Turk points out that using tangible assets as money eliminates counterparty and payment risk. Félix states, that the amount of minable bitcoins is limited similar to the amount of gold.

Furthermore they talk about the security of Bitcoin exchanges and the difference between money and currency. Both endorse the idea of bringing competition to currencies and developing new ways to transact more efficiently.

  1. Anything of value can be stolen.  I read recently that a Bitcoin intermediary had his computer hacked and $250,000 of bitcoins stolen. These belonged to customers.  He admitted that he was responsible for the theft when he left his firewall open for a short time while doing routine maintenance.  This window allowed a thief to hack his ‘bank’ 
    I also read that the software code for bitcoins was hacked by blunt force work.  That is not confirmed.

  2. AGXIIK,

    I asked Turk’s people directly for an explanation why he does business with the banks he often blasts as corrupt and laden withn counterparty risk. This is the reply I got back.

    “Thank you for taking the time to contact us to express your concerns.

    We presently hold bank accounts with The Royal Bank of Scotland International, HSBC, Lloyds TSB and Barclays Bank. Should concerns arise about one of these banks, we would therefore have the option to move funds between these accounts.

    The bank accounts where we hold customer funds are not intended for use as a long-term savings alternative. Rather, they are designed to give more flexibility in managing currency and precious metal balances in customers GoldMoney Holdings.”

    Should concerns arise on RBS, HSBC and Barclays? WOW. Just let that sink it. Uh, like massive govt bailouts, LIEbor, not to mention involvement in the suppression and shorting of PMs? I didnt even bother to respond.

    I will not longer speak favorably about Turk and Goldmoney. Im beginning to question Sprott  too as Ive done some digging there too. 

  3. That is some good intel you got B of P.  I guess it’s difficult to find a bank that’s honest but when a large firm that represents one of the largest of its type in  a particular industry does business with a bank like RBS, a bank that’s been hacked, cracked, smacked and sacked, it makes one wonder.  HSBC seems to be a criminal empire with little resemblance to anything other than a drug laundering extention of the central government and one that also oversees one of the largest ETFs  GLD I think.  JPM runs the other PM ETF.  Barclay’s is ground zero for LIBOR manipulation.  Lloyds and TBS–don’t know about them.
    My concern is that any large firm that allies itself with a mega bank is either setting itself up to be fleeced if the bank runs into trouble, is a pawn in the bank’s larger game or conplicit in illegal going’s ons like JPM and MFG.  Frankly, I don’t fully trust bank  except the Bank of ME.  And that when I’m sober.  haha

  4. I’m in complete agreement with you, AGXIIK if you’re not holding it in your hand, it is likely to disappear into the ethereal or, stolen through inflation. Knowing the game is totally rigged makes the decision to stack the smack a real ‘no-brainer’. Also, my lack of understanding on just why these silver experts would support the use of a system that is such an obvious gateway to theft, has created enough cognitive dissonance to throw a flag. How can you trust these guys again?

    • Agreed.  If we think that we have trouble with banking manipulation now, just wait until a digital monetary system is put in place.  That will make the wholesale theft of customer money about 3 orders of magnitude easier.  Anything that can be abused will be abused and digital money is no exception to this rule.
      I strongly advise anyone who has not read it to do an Internet search for “Howard Buffet gold speech”.  It is a fantastic speech that explains why gold money and personal liberty are connected.  It is usually found as a PDF file that can be downloaded.

  5. bravo, doc, excellent interview!
    but i see some ignorant replies here.
    the issue with the theft at bitfloor, that agxiik alluded to, is a bitfloor problem, not a bitcoin problem. bitfloor is one particlar bitcoin dealer. bitfloor had a major security lapse. would you say that gold and silver shouldn’t be trusted just because you hear a piece of news that a gold dealer had left his vault unlocked and someone came and stole the gold?
    bitcoin, as an algorithm, is completely solid, and is a wonderful piece of technology.
    i wouldn’t use bitcoin as a store of wealth, like i would with silver, but it is extremely useful as a payment gateway, and one that has the ability to bypass government restrictions. the government can shut down banks by killing their SWIFT access, but they have no way to shut down bitcoin, as it is not centralized.
    as far as the strange comments above regarding james turk and goldmoney, above, turk is a brilliant man and a steadfast advocate of gold, why disparage him? the reply goldmoney gave makes perfect sense – a company like gold money does need bank accounts with major banks to acommodate incoming payments whereby customers send in their fiat money to them in order to buy gold.
    and i completely agree with turk’s comments to felix moreno, healthy competition between currencies is a good thing.


    • How can you not see the probable raids by highly motivated hackers all over the planet? Big banks have had their customer accounts hacked, big retail accounts have had info stolen, all done with “secure” systems. While the idea of using this bitcoin to pay some bills sounds nice, it’s just more digits driven by a current that are manipulated by mans devices. Turk and company know this, as do others that want you to believe its a good thing. I don’t buy it for a minute. Bad sophistry for profit.

    • @AB, yes, people will try to steal bitcoins, just like they will try to steal gold bars, and rob banks.
      so, what’s your point? refrain from ever carrying out any transactions of any kind, ever?
      the risks are small if you have proper security.
      the point of bitcoin is not to “pay some bills” as you put it.
      it’s about having a currency that is non-centralized, that government can’t print more of when they feel like it.
      it is anonymous, and free from government interference and controls.
      turk and others want you to believe it’s a good thing, because IT IS a good thing!
      any new technology that allows you to circumvent government control and increases your digital freedom, is definitely a plus.
      how do you not see that?

    • @reflector – My point is simple, all governments are tied to some form of fiat. For intelligent, capable, compassionate people to believe these money junkies will relinquish authority or, power is, IMHO, naive. The hook has been set by TPTB, this fight is going to be ugly AND, with them being in control I want my coins in my pocket where I can exchange them for what actually will pay for stuff. I stack to preserve value. Transferring this value to any electronic system is, not only subject to fraud and manipulation but, another method for these money junkies to steal some more. Now, if or, when(I can only hope)we actually drive these money changers from the temple and, destroy this debt based system, I would be “all in” for bitcoin. Until then I’ll stack and exchange for fiat when needed.

  6. I trust James Turk and GM.  James Turk and GM have been staunch advocates of commodity based (honest) money and transparency in the PM market for as long as I can remember (ie. they have supported GATA since their inception).

    By suggesting that GM being less-than-trustworthy because they do business with the big banks is akin to saying all their (the banks) customers must also be guilty-by-association. (The US government has murdered a million people in Iraq thus far, does this mean that all Americans are sociopathic killers?) It sounds almost as if many of the members on this board live in the outback and have little experience with international/mature businesses.  Do you really expect a company like GM to use your local credit union as their conduit for money transfers?  Companies like GM have little choice but to do business with the likes of RBS because these international banks provide the necessary accessibility and “credibility” (insofar as they are well recognized) to service GM’s international clientele.  And besides, GM is only using these banks to transfer money internationally, these banks do not store GM’s PMs.  

  7. I prefer something physical that has intrinsic value as money and not Bitcoin. Bitcoin is digital so anyone can hack the system and get Bitcoins. Also what if there is an internet shutdown? All the savings will be lost and physical gold and silver doesn’t have that problem. But, Bitcoin is a very nice way to avoid government’s regulations while doing online transactions.

    • please read up on bitcoin, what you say is NOT true: “Bitcoin is digital so anyone can hack the system and get Bitcoins.”
      if you believe this, then please provide a method how anyone can “hack the system” to get bitcoins.
      a second point i would make, is that you don’t understand the value of bitcoin.
      it is extremely useful as a non-centralized payment gateway.
      it is not necessarily a store of wealth like silver is, but it doesn’t need to be, that’s not its purpose.
      different tools for different jobs.

  8. The very best thing about BitCoin is that it is a voluntary payment system.  Anyone who likes the idea of BitCoin is free to make use of it.  Those who do not care for the idea are just as free not to use it.  Choice is good.  🙂

  9. It seems a lot of people here are confused about bitcoin, saying it can be digitally stolen. It can be stolen just like any other asset, including your physical gold or silver, or your “digital” money in the bank by hacker. You can store your bitcoin money just like your gold and silver on a USB key (you can make copies of your “wallet” for extra security as well). So bitcoin is no different any other currency and is open to the same faults.

    Bitcoin cannot be manipulated, as it does not have a central authority or a way to “inject” fak emoney into the pool and you cannot hack “math” upon which the bitcoin protocol is built.

    The fact someone got their computer hacked and their bitcoin stolen is his fault, and not the fault of the bitcoin network, this is no different than someone hacking your computer and using your online banking to steal your money.

    Nothing about the bitcoin protocol it itself has ever been cracked / stolen / hacked / tampered with / manipulated / or cheated. 

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