Producer of physical Bitcoins forced to give up

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by Björn Schöpe

January 2, 2014 – Bitcoin is a virtual currency. Some people, though, mint coins which keep the digital information and permit to touch this kind of money and to store it physically. The US authorities, however, do not approve of this business.

For years Mike Caldwell has produced physical bitcoin coins in his one-man company Casascius. An expert minted these coins on his behalf and attached the private key which permits to have access to the virtual bitcoins under a tamper-proof hologram strip. For a fee of 50 dollars per coin Caldwell shipped the coins via post.
According to the US finance department FINCEN this non-declared business is about transmitting money. Mike Caldwell does not think so. His clients pay in virtual bitcoins he dispatches them physical ones, he does not accept dollars. For that reason he believes that he only changes the medium, and that he produces also for collectors. However, as a consequence of the letter he received from FINCEN he closed his business since he does not want to tangle with them. Neither does any of his colleagues, since he is not the only one to produce physical bitcoins. Yet. Other men in a similar position let know that they would close their activities too if they were to receive notices from FINCEN.

Since some time many states, and the USA in particular, apparently felt uncomfortable with the success of Bitcoin because they feared for their currency monopoly. Although Bitcoin is in no way bound to physical units this recent development has been a strike for many bitcoin owners. And, of course, for the producers. The market of bitcoin collectors could only start to boom, though. Caldwell’s first series of bitcoin coins shows a misspelling and has become an intriguing object for collectors long ago. On Ebay you can find such coins paid for over 3,000 dollars. A rare issue (at least one coin out of 11,000) loaded with 1 Bitcoin equalling to some 1,000 dollars according to the seller, is offered for not more than £75,000 (US$ 122,300 or 88,800 euros)! It seems as if Caldwell had actually produced his bitcoins for a collector market gone wild. But this the authorities will never believe him, anyway.

You can read an article on the end of Casascius on Wired.

This is the official website of Casascius.

In online forums single series are being discussed intensively by collectors.

On Ebay there are quite absurdely high offers.

Some time ago we reported on the latest development of Bitcoin.