It’s time to bring in the Bitcoin news good with the bad. A so-called crowd-funded “Assassination Market” run by a shifty wannabe political specter surfaced that takes bitcoins as bounty to kill government officials—but that hasn’t done much to dampen the great news coming out of this week’s Senatorial hearings about virtual currencies.

In fact—although a prime target of people who like Bitcoin—Chairman of the Federal Reserve Ben Bernanke was cautiously optimistic in a letter to the same hearings. And, to make matters even more interesting, the Senator from Kentucy went to Reddit to mull over questions that might become important when it comes to Bitcoin and the United States.

As for BTC value, China has been boosting investments in BTC value with a sudden surge from over the weekend giving the currency a wild ride right to the $900 high water mark in USD. That didn’t last long, however, although bidders seemed momentarily interested, the price quickly tumbled with a rapid sell off bringing it back down into the $500s and now it’s hovering around $600. While it’s obvious that the Chinese and China-based exchanges are huge drivers in this volatility it’s also apparent that the market has reached a whole new level.

This and more in today’s Bitcoin Weekly.

Assassinations crowd-funded with Bitcoin?

People may now recall that Silk Road was well known for being a haven for potential drug buys and other black market goods and that its founder, the Dread Pirate Roberts (one Ross William Ulbricht), was charged with murder-for-hire, but the so-called “Assassination Market” really takes the cake on criminality done with Bitcoin funding.

A man using the pseudonym Kuwabatake Sanjuro e-mailed security columnist Andy Greenberg at Forbes announcing the presence of this dark website offering BTC bounties for high publicity murders. Of course, the correspondence was encrypted.

The market itself doesn’t connect anyone with a would-be assassin; instead it allows anonymous donors to pitch Bitcoins into a bounty purse against particular government official targets. The crowd-funding aspect takes place as wallets fatten and should someone on the list meet an untimely demise, Sajuro says that with the proper proof the BTC bounty will be released to the killer.

So far whose made the kill-list? The rolls include such targets as NSA director Keith Alexander (10 BTC), President Barack Obama (40 BTC), Ben Bernanke, chairman of the Federal Reserve (124.14 BTC.) At the current USD average exchange rate per BTC Bernanke sits at about $70k, where as the President barely rates $20k.

In writing his article, Greenberg contacted the FBI and Secret Service about the site, but neither agency could comment.

Ben Bernanke gives his cautious blessing to Bitcoin

It only seemed fitting to quote the words of the man who has a $70k bounty on his head on a website crowd-founded by BTC talking about the virtual currency itself. Although people have been spending bitcoins to show their distaste for him, he showed little such disregard for the cryptocurrency itself when he wrote to senators who recently held hearings on digital coin.

While acknowledging that cryptocurrencies are outside the purview of entities such as the Federal Reserve, of which Bernanke is the chairman, but he added “there are also areas in which they may hold long-term promise, particularly if the innovations promote a faster, more secure and more efficient payment system.”

Read the full letter over at Quartz.

US Senator goes to Reddit to do his homework for BTC Senate hearings

Senator Jerry Moran (R-KS) goes to Reddit about Bitcoin hearings to ask /r/bitcoin what he should know when he went into the hearing and the community responds with resounding information and adulation.

Amid his questions at the hearing (see video above) he included looking at how regulation could encourage or stifle innovation involving bitcoins on US soil. Making it a very excellent question because as regulation rises around the use of cryptocurrencies and bitcoins; it could lend a chilling effect to the US economy itself as other countries seek to embrace Bitcoin.

The top-rated comment from /u/silvertiger urged the senator to seek to normalize regulation to pave the way for more BTC exchanges in the US:

Very impressed you took the time/effort to reach out to Reddit. I would like you to know that every day that goes by, the barrier created by the patchwork of 47 state-by-state money transmission licenses is causing the US to fall further and further behind in the global competition to build deep liquid markets for Bitcoin. US-based exchanges now account for only about 2% of global trade volume. Meanwhile, where are the new exchanges opening? China, Singapore, Canada, and elsewhere.

Others sought to use /u/bitcointip (a bot on Reddit that tips other users with bitcoins) to give the senator bitcoins—amidst jokes about bribery and thoughts that it might show some of the inner workings of the functionality of the cryptocurrency.

Many users expressed concerns that Bitcoin is perceived or portrayed as being primarily for illegal transactions. A dark misconception that could be instantly dispelled by reading almost any Bitcoin Weekly or list of merchants, ATMs, and institutions looking to use the currency do so because its practical and useful (the ghoulish “Assassination Market” aside as ghastly anomaly.) Not too long ago Bigpoint Games jumped on the BTC bandwagon, a virtual currency for virtual goods.

In 5 hours, almost 600 comments appeared thanking the senator, explaining Bitcoin-basics, and including hopes for such things as innovation, its practical applications as a currency, and heartfelt thanks that a member of the US legislature actually knows enough about the Internet to use Reddit as a resource.

Senate hearings themselves ended up being fairly positive

As boring as Senate hearings can get, the whole endeavor came out with most of the senators involved and speakers asking questions about how the Bitcoin protocol works, speaking with BTC luminaries, and seeking knowledge on how to best fit it into the current regulatory process of the United States.

The low point of the proceedings came about when Sen. Mark Kirk (IL-R) said, “I have been worried about Bitcoin some, because it’s so complicated it could facilitated illegal activity or terrorist activity.” (Video clip.) Of course, the point of the proceedings was to better elaborate on the complexities of cryptocurrencies and show how they work as practical financial tools with legitimate purposes as well as the illicit.

The high point really came when Tony Gallipi, co-founder and CEO of BitPay, took the floor and delivered a brilliant speech describing the innovation that Bitcoin represents and also some of the technical struggles it will face. He couched much of his speech in a description of Bitpay’s “credit card-like” model and how Bitcoin can be used to transact business.

The full hearing was long and dry, but had its ups and downs, you can catch up on the entire hour-and-a-half here.

Bitcoin Black Friday coming Nov 29

Bitcoin Friday was founded last year by Jon Homquist as an evangelistic event to get merchants to take bitcoin and to gather up customers to buy with bitcoin. In 2012, only 75 deals made it onto the rolls of Bitcoin Friday; this year with Bitcoin Black Friday 2013 the event is expecting almost 500 bitcoin-accepting merchants and likewise deals to be available for customers to buy from merchants, dealers, and services.

If you’re interested in those deals, head over to BitcoinBlackFriday.com and sign up.