As Bitcoin surges, investors warn of Longmont-based TEH

Investors from around the globe are warning of a Longmont-based Bitcoin CEO who they allege defrauded them by claiming to be the victim of a cyberhack, potentially making off with hundreds of thousands of dollars.

When they find out that Coinbase and other companies don’t have the bitcoin to payout all their accounts there will be a crash. Folks think Coinbase is a bank. They are not. So, if there is a run, they will not be able to pay out. Fortunately for them, the price of bitcoin will tank and they may be able to buy it back cheaper as long as there is enough of it to go around.

There are two large reasons I have never pulled the trigger on bitcoin even though I always figured its value would go through the roof. First its hard to actually keep it on your own. If you get a wallet that wallet has to be safe from hacking. And the device is subject to hardware failure. Second the companies like Coinbase are not regulated. They are as good as their word. Several of their competitors have already folded. So, this is not the nice friendly insured and regulated bank or investment firm you are used to dealing with. And they have huge fees. Bitcoin had better be going up, because your expense to hold it sure is.

You don’t have to keep the wallet. You just encrypt the key and save it in drop box or as an attachment in your stored email. Or you use a key that you can remember, like a sentence from your favorite book. You can always recreate the wallet if you have the key.

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