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The biggest argument against bitcoin, in my mind is this: Regulators really only get involved in allowing/prohibiting innovations very late in the game. I'm t
by stakhanov 8y ago
The biggest argument against bitcoin, in my mind is this:
Regulators really only get involved in allowing/prohibiting innovations very late in the game. I'm thinking of how Air BNB and Uber were allowed to grow really huge despite being blatantly in violation of a lot of laws in a lot of places (for example restrictions around subletting in contracts between tenants and landlords, regulations around running businesses that are hotels or taxis, etc). Only after they had gotten really big did regulators start to think about whether or not they like what's going on, and then they shut down large parts of the sharing economy.
For bitcoin there are only two scenarios in my mind: Either it dies right now for the problems it is facing right now (network externalities around lack of merchants/customers outside darknet/illegal stuff, volatility etc), or it overcomes those problems, gets really big, and is then killed by regulators.
For the most part the trend in regulation of financial services and financial reporting has been: erosion of banking secrecy (even Switzerland and tax havens in the Carribean are now sharing data with law enforcement), anti-money laundering regulation tightened (FATCA/CRS), increased requirements around creating transparency about ownership of legal entities in cross-border corporate structures (e.g. "persons of significant control" register introduced in the U.K. and many European countries), increased reporting obligations around cash transactions even for small businesses (parts of Europe are now mandating the introduction of electronic cash-registers capable of reporting on a transaction-by-transaction basis even for small businesses like a self-employed taxi driver), etc. etc.
Allowing bitcoin to happen would not fit into that regulatory trend AT ALL.
It's just that bitcoin isn't big enough yet for regulators to even be thinking about it. But it'll happen.
- deleted 8y ago[deleted]
- Ruphin 8y agoBitcoin and cryptocurrencies are an active issue for regulators right now. Statements have come out from several parties that confirm networks like Bitcoin and Ethereum are not securities. The SEC is actively shutting down ICO schemes that are deemed securities. Things are moving slowly because it's a complicated topic, but we are seeing more and more guidance from regulators like the SEC and others. AirBnB and Uber are doing pretty fine for companies that got killed by regulators.
- tim333 8y agoIt's fairly hard to buy Bitcoin or ETH for fiat without uploading your passport and then subsequent transactions are logged on the public blockchain so it's not that bad for the regulators.
- stakhanov 8y agoI did not say AirBnB and Uber "got killed" by regulators. I said that it had, at one point, reached a level that was clearly beyond what was within legal limits, and that afterwards "large parts" of that got shut down. BTW: This is a trend that is still ongoing and we have by no means reached the end of it, especially in Europe where there is a lot more regulation around who gets to be a taxi or a hotel (see Madrid taxi strike raising awareness about Uber's illegal role in the market there) The SEC ruling that bitcoin is not a security is not really saying anything much as there are many facets to it (should the law treat it as being somehow equivalent to cash? equivalent to transactions carried out by banks?). It's also not saying anything about this pesky little thing that Americans keep forgetting about called "the rest of the world" and even if bitcoin is not in voilation of any laws that exist now, that doesn't mean that new laws won't be brought in to outlaw bitcoin etc. etc.