4 ms·

In the US, buying anything with Bitcoin is a taxable event. You might get away with buying the odd coffee but I suspect buying large items like houses and cars

by erentz 9y ago

In the US, buying anything with Bitcoin is a taxable event. You might get away with buying the odd coffee but I suspect buying large items like houses and cars will start to attract attention if you didn’t report the capital gains for it.

kneel 9y ago
For now, the law is on a collision course with technology. Taxable events need to happen in fiat, there is too much incentive to obfuscate these events on blockchains. Transactions in cryptocurrencies will become increasingly hard to trace. I'm not sure governments know what they're up against.
- TeMPOraL 9y ago
  > I'm not sure governments know what they're up against. Oh, they know. Bunch of idealists who are also pretty bad programmers with delusions of understanding finance. Plus a lot of scammers, and even more gullible people who just want to get rich quickly. Nothing governments can't handle when they eventually start caring.
  - kahnpro 9y ago
    Yup. Everything old is new again. Governments aren't facing any new problems here... while crypto can be moved faster than cash, I suspect that in the end governments may end up with even tighter control of crypto than they ever had with cash.
    - kneel 9y ago
      >I suspect that in the end governments may end up with even tighter control of crypto than they ever had with cash. I'd LOVE to see a govt try to control cryptocurrencies, the thought is laughable.
    - garmaine 9y ago
      The whole point of bitcoin is that there is no mechanism by which government (or any other actor) could exert such control.
garmaine 9y ago
Laws can be changed.
- PeterisP 9y ago
  Sure, and I'd bet that they are going to be changed in the opposite direction than what you'd (presumably) want, to ensure that it's harder to use cryptocurrencies in an anonymous or tax-avoiding manner. For example, it seems that currently USA sellers are allowed to interpret sales in Bitcoin as "barter events" and not submit the usual cash payment form 8300 for such sales, but (as you say) laws can be changed and I expect that this won't be the case soon, and the changed laws would be likely to require any legitimate seller to report such transactions (for non-small amounts, like the form 8300 limit of $10000 USD) and refuse them at all if the buyer wishes to remain anonymous. All it takes is a tiny change in the laws, extending the sentence "Cash may also include cashier’s checks, bank drafts, traveler’s checks, and money orders" by adding a definition of cryptocurrency. It's not done yet simply because the gov't is slow to react. Anyone considering the future of cryptocurrencies should consider not only the current laws, but how the laws are likely to be changed to extend the current regulation principles to cover cryptocurrencies - the governments around the world have a rather clear and long-term consensus about the goals and principles of that regulation, and changes in technology simply mean that the written law will lag a few years while that consensus is (re-)implemented in laws covering the New Thing.

by erentz 9y ago

kneel 9y ago

For now, the law is on a collision course with technology. Taxable events need to happen in fiat, there is too much incentive to obfuscate these events on blockchains. Transactions in cryptocurrencies will become increasingly hard to trace. I'm not sure governments know what they're up against.

TeMPOraL 9y ago
> I'm not sure governments know what they're up against. Oh, they know. Bunch of idealists who are also pretty bad programmers with delusions of understanding finance. Plus a lot of scammers, and even more gullible people who just want to get rich quickly. Nothing governments can't handle when they eventually start caring.
- kahnpro 9y ago
  Yup. Everything old is new again. Governments aren't facing any new problems here... while crypto can be moved faster than cash, I suspect that in the end governments may end up with even tighter control of crypto than they ever had with cash.
  - kneel 9y ago
    >I suspect that in the end governments may end up with even tighter control of crypto than they ever had with cash. I'd LOVE to see a govt try to control cryptocurrencies, the thought is laughable.
  - garmaine 9y ago
    The whole point of bitcoin is that there is no mechanism by which government (or any other actor) could exert such control.

garmaine 9y ago

Laws can be changed.

PeterisP 9y ago
Sure, and I'd bet that they are going to be changed in the opposite direction than what you'd (presumably) want, to ensure that it's harder to use cryptocurrencies in an anonymous or tax-avoiding manner. For example, it seems that currently USA sellers are allowed to interpret sales in Bitcoin as "barter events" and not submit the usual cash payment form 8300 for such sales, but (as you say) laws can be changed and I expect that this won't be the case soon, and the changed laws would be likely to require any legitimate seller to report such transactions (for non-small amounts, like the form 8300 limit of $10000 USD) and refuse them at all if the buyer wishes to remain anonymous. All it takes is a tiny change in the laws, extending the sentence "Cash may also include cashier’s checks, bank drafts, traveler’s checks, and money orders" by adding a definition of cryptocurrency. It's not done yet simply because the gov't is slow to react. Anyone considering the future of cryptocurrencies should consider not only the current laws, but how the laws are likely to be changed to extend the current regulation principles to cover cryptocurrencies - the governments around the world have a rather clear and long-term consensus about the goals and principles of that regulation, and changes in technology simply mean that the written law will lag a few years while that consensus is (re-)implemented in laws covering the New Thing.