The Empire Strikes Back – At Bitcoin

Guest Contributor John Rolls

One of the uncertainties with cryptocurrencies has always been how governments would react once bitcoin and its kin got big enough to actually threaten the monopolies of national fiat currencies.

That day seemed to be approaching as cryptocurrencies’ aggregate market cap blew through $100 billion and the pipeline of new bitcoin wannabes (initial coin offerings, or ICOs) swelled into the hundreds. Even – in a classic sign of a bubble top — Paris Hilton got involved:


Hotel Heiress Paris Hilton Is the Latest Celebrity to Promote an ICO

(Coin Desk) – Celebrity heiress and reality TV star Paris Hilton has taken to Twitter to announce her participation in a token sale, or ICO.

Called Lydian, the venture claims the project is developing “blockchain driven technologies to reduce ad fraud and to maximize the effectiveness of ad marketing expenditures.” The idea has been floated by a number of projects of late, including efforts backed by advertising industry participants.

In the tweet, Hilton wrote:

Looking forward to participating in the new @LydianCoinLtd Token! #ThisIsNotAnAd #CryptoCurrency #BitCoin #ETH #BlockChain  — Paris Hilton (@ParisHilton) September 3, 2017

And lately governments have indeed begun to defend their turf. The US Internal Revenue Service decided that since cryptocurrencies were clearly not money (only the dollar is money!) they must be commodities, which means every transaction creates a taxable gain or loss. In August the IRS drove the point home by unveiling software that can track supposedly anonymous crypto transactions:

The IRS Has Special Software to Find Bitcoin Tax Cheats

(Fortune) – One benefit of using bitcoin is the digital currency can be anonymous—its owners can move money around the world without revealing who they are. Well, in theory at least. In reality, bitcoin is less secret than people think.

The latest reminder of this comes via a report that the Internal Revenue Service is using software to unmask bitcoin users who have failed to report profits. According to a contract unearthed by the Daily Beast, the IRS is paying a company called Chainalysis to help identify the owners of digital “wallets” that users employ to store their bitcoins.

In a letter to the IRS, the co-founder of Chainalysis says the company has information on 25 percent of all bitcoin addresses and that it deploys millions of tags to help track and identify transactions.

The decision by the IRS to license the software of Chainalysis, which is based in Switzerland with an office in New York, appears to be part of the agency’s larger campaign to target digital currency users who have failed to pay tax.

As Fortune reported earlier this year, the IRS claims only 802 people declared a capital gain or loss related to bitcoin in 2015. This is significant since the price of bitcoin soared from around $13 to over $1100 between 2013 and 2015, and hundreds of thousands (like millions) of Americans bought and sold digital currency during this time—in other words, there are many people who face bitcoin-related tax trouble, and the IRS is tracking some of them down.

Then China decided it had had enough of the dot-com-like tsunami of new digital currencies pouring into its economy, and banned future releases, crashing the price of most extant cryptocurrencies.

China Halts Initial Coin Offerings

(Bloomberg) – Bitcoin tumbled the most since July after China’s central bank said initial coin offerings are illegal and asked all related fundraising activity to be halted immediately, issuing the strongest regulatory challenge so far to the burgeoning market for digital token sales.

The People’s Bank of China said on its website Monday that it had completed investigations into ICOs, and will strictly punish offerings in the future while penalizing legal violations in ones already completed. The regulator said that those who have already raised money must provide refunds, though it didn’t specify how the money would be paid back to investors.

It also said digital token financing and trading platforms are prohibited from doing conversions of coins with fiat currencies. Digital tokens can’t be used as currency on the market and banks are forbidden from offering services to initial coin offerings.

“This is somewhat in step with, maybe not to the same extent, what we’re starting to see in other jurisdictions — the short story is we all know regulations are coming,” said Jehan Chu, managing partner at Kenetic Capital Ltd. in Hong Kong, which invests in and advises on token sales. “China, due to its size and as one of the most speculative IPO markets, needed to take a firmer action.”

Bitcoin tumbled as much as 11.4 percent, the most since July, to $4,326.75. The ethereum cryptocurrency was down more than 16 percent Monday, according to data from Coindesk.

And apparently there’s more coming:

ICO crackdown may just be the start: China is reportedly planning tighter cryptocurrency rules

(CNBC) – China is poised to further tighten rules on virtual currencies after regulators on Monday banned virtual coin fundraising schemes, Chinese financial news outlet Yicai reported, citing sources.

China banned and deemed illegal the practice of raising funds through launches of token-based digital currencies, targeting so-called initial coin offerings (ICO) in a market that has exploded since the start of the year.

Yicai’s report late Monday cited a source close to decision-makers as saying the announcement on the ban was just the start of further follow-up regulations of virtual currencies.

The above raises two big questions. First, how will cryptocurrencies fare in a world of increasingly strict and complex regulations? Second, what kinds of assets stand to benefit if cryptocurrencies cease to function as “digital gold”?

The first question is a tough one, because it involves the interplay of governments, revolutionary tech and free markets, which means pretty much anything is possible. The second, though, is easier: If digital gold falters, real gold wins:

Mobius Foresees Cryptocurrency Crackdown Sparking a Rush to Gold

(Bloomberg) – Mark Mobius is sensing danger in the explosive growth of cryptocurrencies.

Governments will begin clamping down on digital currencies because of their use in illicit financing, with terrorist groups to drug dealers contributing to their rise, Mobius, executive chairman at Templeton Emerging Markets Group, said in an interview in Hong Kong Monday.

“Cryptocurrencies are beginning to get out of control and it’s going to attract the attention of governments around the world,” Mobius said. “You’re going to get a reversion back to gold because people are going to wonder, can I really trust these currencies?”

Mobius isn’t the only one voicing concern. Bank of America Merrill Lynch was cautious around bitcoin in July, saying there were a lot of obstacles, such as theft and hacking risks, that make it unlikely it will gain the status of pledgeable collateral.

“People need a means of exchange and they need to trust that,” said Mobius, who was interviewed before China’s announcement. “Right now the trust is good — with bitcoin people are buying and selling it, they think it’s a reasonable market — but there will come a day when government crackdowns come in and you begin to see the currency come down.”


See more articles by John Rolls





Ending Will Be Financial Collapse Where Credit Stops- Bill Holter (Video)

by N.Morgan

The price of gold and silver have experienced an uptick in value recently.

Financial writer Bill Holter, a precious metals broker, says price is irrelevant to the average investor.

It is possession that is most important now.

Holter explains, “I think the streets are going to be completely cleaned of gold and silver, and they are going to go ‘no offer.’

There will be bid, bid, bid and higher, higher, higher, and there won’t be any for sale.

Gold and silver will go into hiding until new currencies come out that can be trusted. I think that’s where we’re headed.

You should buy it now because it’s available. At some point in time, it’s not going to be available, and you are either going to have it or you won’t.

The price won’t matter. You will count your wealth in ounces.”

In closing, Holter states, “The timing on this is who knows? September or October or next year, I don’t know. I do know what the ending is.

The ending is a financial collapse where credit stops and people figure out the asset they hold is someone else’s liability. . . .

Why not have an asset with no liability, which is gold and silver.”




Rothschilds Buy Up All of the Gold Signalling World Banking Collapse? (Video)

(N.Morgan) Jacob Rothschild has recently announced his intentions to buy up all remaining gold to replace stock market and currency exposure, due to the world’s central banks being “out of control”, signalling what could be the biggest financial crisis since the Lehman Brothers crash in 2008.

The biggest bank in Germany is on the verge of collapse which is set to send massive reverberations throughout the EU, the US and around the world. The predicted global banking collapse seems even more imminent as the Rothschild’s signal more warning signs by buying up gold.

FreeThoughtProject reports: The prospect of a cataclysmic global banking collapse of this nature has not been seen since the implosion of Lehman Brothers in 2008, and subsequent fallout in the global banking world.

But these events haven’t taken place in a vacuum, as earlier this year savvy international investor Lord Jacob Rothschild, during a semi-annual address to RIT Capital Partners, announced that they are reducing stock market and currency exposure and increasing their gold holdings, warning that the world is now in “uncharted waters” and the consequences are “impossible” to predict.
Rothschild stated:

“The six months under review have seen central bankers continuing what is surely the greatest experiment in monetary policy in the history of the world.

We are therefore in uncharted waters and it is impossible to predict the unintended consequences of very low-interest rates, with some 30% of global government debt at negative yields, combined with quantitative easing on a massive scale.”

The collapse of Deutsche Bank would most likely begin a cascade of Western banking institutions falling like dominos (which could include Barclays in London and CitiGroup in the U.S.). This according to the same expert who valued Lehman’s worth at its collapse, Deutsche Bank’s current value of $1 trillion dollars is significantly more than Lehman Brothers’ valuation during their collapse in 2008.

The contagion from a collapse of this magnitude could potentially trigger a systemic banking collapse the likes of which the world has never experienced. The EU would almost certainly disintegrate upon a collapse of this magnitude, as Deutsche Bank is the largest bank in Germany — which is essentially the financial heart and soul of the EU.

When Jacob Rothschild made the decision that he is buying gold it is because the central banks are out of control, you begin to understand the scope and magnitude of what is transpiring, as his family has been in de facto control of the world’s central banks for centuries.

Deutsche Bank shares have fallen sharply on the news that German Chancellor Angela Merkel won’t bail out the struggling bank, with shares falling by as much as six percent in early week trading, turning in their worst performance since 1992. Since just January, the bank’s shares have lost over 52 percent of their value.

Merkel has also refused to provide state financial assistance to Deutsche Bank in its legal battle with the U.S. Department of Justice. The chancellor made her position clear during talks with Deutsche CEO John Cryan, according to Focus magazine. The German-based lender may be fined up to $14 billion over its mortgage-backed securities business before the 2008 global crisis.

The German Chancellor also noted that Deutsche Bank will not be getting a bailout from the European Central Bank – the lender of last resort for European banks.

Revealing the truly dangerous threat the German megabank poses to the international banking system, a report from the International Monetary Fund in June implied that Deutsche Bank was a systemic risk to the global financial system.

Many fear that in the wake of Merkel’s refusal to bail out Deutsche Bank, Germany may now be considering a bail-in instead?

According to Investopedia:

A bail-in is rescuing a financial institution on the brink of failure by making its creditors and depositors take a loss on their holdings. A bail-in is the opposite of a bailout, which involves the rescue of a financial institution by external parties, typically governments using taxpayers money. Typically, bail-outs have been far more common than bail-ins, but in recent years after massive bailouts, some governments now require the investors and depositors in the bank to take a loss before taxpayers.

Essentially, this entails the bank stealing deposited funds, with virtually no recourse for those individuals who have their savings stolen.

It’s not at all beyond the realm of possibility, as it has happened before in very recent history. To keep the bank solvent, the Bank of Cyprus took almost 40 percent of depositor’s funds – leaving customers with essentially nothing they could do about having their money stolen. Assets were frozen and ATM machines were not refilled.

Perhaps this explains why in mid-August Germans were told by their government to stockpile 10 days worth of water, and five days worth of food in case of a “national emergency” hitting the country, with the Czech Republic following suit and making a similar announcement within days of the German warning.

Deutsche Bank’s unbelievably risky portfolio and its exposure to the derivative markets, which stands at over $40 trillion dollars, would undoubtedly cause exponentially more damage than the Lehman Brothers collapse did back in 2008, which precipitated the Great Recession of 2008.

This risk of failure has now gotten so threatening that a number of funds that clear derivatives trades with Deutsche Bank AG have withdrawn excess cash and positions held at the lender, according to Bloomberg.

While the vast majority of the banks, more than 200 derivatives-clearing clients have made no changes, the hedge funds run on cash highlights serious concern. The paranoia of an imminent collapse spread to the US on Thursday, as 10 hedge funds that are Deutsche Bank clients have decided to withdraw cash and listed derivatives positions from the bank, according to a Bloomberg News report.

Millennium Partners, Capula Investment Management and Rokos Capital Management are among about 10 hedge funds that have cut their exposure, said a person familiar with the situation who declined to be identified talking about confidential client matters.

The hedge funds use Deutsche Bank to clear their listed derivatives transactions because they are not members of clearinghouses. Millennium, Capula and Rokos declined to comment when contacted by phone or e-mail.

Highlighting the contagion banking effect, news that some hedge funds were pulling positions and excess collateral from Deutsche Bank caused shares of U.S. banks to quickly reverse early gains, according to Bloomberg.

Just as Lehman Brothers disingenuously claimed they were financially solvent as the upcoming financial storm brewed in 2008, only to file for bankruptcy, Deutsche Bank has attempted to allay investor concerns by claiming that their financial fundamentals are sound. One would be wise to be very suspicious of any statements made by a failing banking institution.

When the government warnings start, you can be assured that it’s already too late, as the availability of supplies in the case of emergency would be severely constrained after a warning due to the large number of people attempting to procure an extremely limited amount of supplies.

Will Germany become the powder keg that implodes the global economy? Only time will tell, but all signs point to a very similar situation to 2008 — but without central banks having much recourse, as negative interest rates and quantitative easing were some of the last arrows in the quiver being used to prop up the global economy.

What is certain is that an ounce of prevention, ahead of any potential collapse, is the most viable solution for those looking to safeguard themselves and their families. The key is to stock up on food, water and other necessities in advance of the actual crisis fully manifesting. A minimal amount of effort put into preparing early for the side effects of a major economic disaster could be the difference between surviving the crisis, or not, for your family.




See all stories by N. Morgan

The “Buy Gold” Signal Strongest Seen in 16 Years (Video)

(N.Morgan) Alan Greenspan once said: “When gold is accepted as the medium of exchange by most or all nations, an unhampered free international gold standard serves to foster a world-wide division of labor and the broadest international trade. Even though the units of exchange (the dollar, the pound, the franc, etc.) differ from country to country, when all are defined in terms of gold the economies of the different countries act as one-so long as there are no restraints on trade or on the movement of capital.”  From Gold And Economic Freedom,” 1966

Anyone actively involved in the financial markets during Greenspan’s tenure as Chairman of the Federal Reserve would be surprised to see that comment above coming from Greenspan.

He was known as the king of the printing press until his successor, Ben Bernanke took over the role of chief money and credit creator.

The Daily Coin stated it best: “While it might not show up in the Fed’s “M” accounts, which are various measures of the “money supply,” Greenspan’s Fed shepherded in an era of unprecedented growth in systemic debt – private and Government – and unprecedented decline in credit standards. By the end of Greenspan’s reign of monetary terror, anyone with no more than two nickels to rub together could qualify for a credit card or mortgage.”

The graph above illustrates the total debt outstanding system-wide in the U.S. during Greenspan’s Fed.

The level debt increased over 400%. GDP?

The real GDP is said to have grown about 85%, but this metric is overstated by the amount that the Government underestimates the true inflation rate and by faked changes to the GDP calculation for purposes of political expediency.

In this latest episode of the Shadow of Truth, the guys discuss the manipulation of gold, directly and targeted fake news reports about gold that are intended to kill people’s interest in buying gold.

Their analysis explains how gold is giving one of its strongest “buy” signals in the last 16 years:


Surprise: Ukraine Admits Its Gold Is Gone: “There Is Almost No Gold Left In The Central Bank Vault”



(N.Morgan) In March when the IMF reported that Ukraine’s official gold holdings as of the end of February, so just as the State Department-facilitated coup against former president Victor Yanukovich was concluding, amounted to 42.3 tons.The price of gold reached an absolute historical maximum – gram gold selling at 665 Ukrainian Hryvnia.

Incidentally, since the beginning of the year, gold has risen in price in Ukraine almost doubled. Moreover, rumors that the international reserves of the Ukraine were only horns and legs, were true. And it confirmed the most reliable source. “In the vaults of the NBU is almost no gold. There is a small amount of gold bullion, but it is literally 1% of the gold reserves,” – the recognized head of the NBU Valery Gontareva. What happened to the gold reserves of Ukraine.


Another country whose gold has been pillaged by unscrupulous govt officials and organizations, bent of destroying the world’s economy.







Ukraine goldjpg_0










More Stories Contributed By N. Morgan



Ah Ha! Ukraine’s Gold Reserves Sent To NY Federal Reserve

(N.Morgan) So far this has been unsubstantiated, but a report out of Russia claims that Ukraine’s gold reserves were sent to The Federal Reserve in New York. For safe keeping? Why on earth would the Ukraine trust the Fed with their gold, when our gold and Germany’s gold is missing? A very curious item.



From the source:

Tonight, around at 2:00 am, an unregistered transport plane took off took off from Boryspil airport. According to Boryspil staff, prior to the plane’s appearance, four trucks and two cargo minibuses arrived at the airport all with their license plates missing. Fifteen people in black uniforms, masks and body armor stepped out, some armed with machine guns. These people loaded the plane with more than forty heavy boxes.

After this, several mysterious men arrived and also entered the plane. The loading was carried out in a hurry. After unloading, the plateless cars immediately left the runway, and the plane took off on an emergency basis. Airport officials who saw this mysterious “special operation” immediately notified the administration of the airport, which however strongly advised them “not to meddle in other people’s business.”

Later, the editors were called by one of the senior officials of the former Ministry of Income and Fees, who reported that, according to him, tonight on the orders of one of the “new leaders” of Ukraine, all the gold reserves of the Ukraine were taken to the United States.







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The Elite’s Secret Global Accounts Of Gold Wealth: Karen Hudes (Video)

(N.Morgan) The elite have stashed their gold wealth, in preparation fro the dollar losing its worth. They know gold/silver will be the only feasible currency, until the come up with the One World Govt currency. In the video below, the World Bank whistleblower Karen Hudes, details how global accounts of gold are located in several banks around the world and administered by people uninterested in fixing global debt. We take a look down the rabbit hole with Hudes in this Buzzsaw interview clip hosted by Sean Stone.




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Fed’s Dirty Little Secret: “The Gold Isn’t There… Exists As Paper IOU’s” (Video)

(N.Morgan) It’s not so much of a secret anymore. As I’ve stated in past articles, I knew that Fort Knox was more than likely empty and now the Fed has admitted as much. The Dollar has o backing now and is in essence, worthless.

According to Paul Craig Roberts:

Former Assistant Treasury Secretary Paul Craig Roberts is making some bold new claims about the Federal Reserve and its official government gold holdings. Dr. Roberts contends…

“They don’t have any more gold. That’s why they can only give Germany 5 tons of the 1,500 tons it’s holding.  In fact, when Germany asked for this delivery last year, the Fed said no. But it said we will give you back 300 tons . … So, they said we will give you back 20% of what you trusted us to keep for you over the next seven years, but they are not even able to do that.”

Dr. Roberts goes on to say… “The stocks of gold at the Bank of England seem to be disappearing. The stocks of many of the gold trusts, such as GLD, are being looted … all of this gold is disappearing into Asian markets. The entire West is being drained of gold.”


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Where Is The Gold ? (Video)

(N.Morgan) Many have wondered if Fort Knox was empty. Germany was unable to get their share of the gold America was suppose to be holding for them. The big question is, where did the gold go? Who has it? Did The Fed sell the gold unbeknownst to the American people and the world abroad?

Were we sold out by our govt again and The Federal Reserve? Without gold, the Dollar is worthless. Our economy was conceived on the gold standard and now the gold’s gone. So, is the Dollar now worthless?


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