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It's completely reasonable to tax investment earnings. That said, these regulations are concerning to me as a developer interested in actually building on block

It's completely reasonable to tax investment earnings. That said, these regulations are concerning to me as a developer interested in actually building on blockchain technology. At least from what I understand, just doing what's rapidly becoming run of the mill Web3 development is becoming extremely fraught territory for US citizens who want to comply with accounting and tax rules. It's an even bigger deterrent for students with limited ability to hire an accountant. It wouldn't have been good for the US to stifle the web 25 years ago and I don't think regulating blockchain tech worldwide will work any better than trying to restrict the export of PGP did. Talent will just leave.

metalliqaz 5y ago
Why can't you do run of the mill Web3 development without transferring >$10K ???
- christiansakai 5y ago
  You need to pay gas fees to transfer/execute smart contracts.
pradn 5y ago
It seems to me that the US government is doing this at the right time. We're not in the early stages of cryptocurrency. We've had 10 years for lots of new ideas to mature, and we're on the verge of the most promising of all - Etherium transitioning from PoW to PoS. I'd say this is somewhat late given the Bitcoin/Etherium's popularity among small investors with much to lose, immense greenhouse gas emissions, and facilitation of ransomware and dark markets. Any crytocurrency good enough to be useful will be large enough to have an ecosystem that complies with these rules. Our society regulates money exchange for a reason. It can be put to tremendous negative use - funding criminal activities, siphoning money from public investment, etc.
- noofen 5y ago
  > It can be put to tremendous negative use - funding criminal activities, siphoning money from public investment, etc. And just like fiat, these activities will continue in the shadows, while innovation is harmed by regulation.
- deleted 5y ago
  [deleted]
Daishiman 5y ago
I keep hearing about all these amazing crypto products, yet outside of this very specific scene, where curiously only the VCs and devs involved wax poetic about it, you can never seem to find a real customer talking about their experience. You either acknowledge that cryptocurrencies look close enough to currencies or securities and regulate them as such, or you promote them for illegal and ambiguously legal reasons for which there is little rationale for a commercial endeavor. Anything else is just basically letting people slowly reinvent the finance system, with all the inevitable pitfalls it will have. Yes, it's regulated, so are most industries that have substantial systemic risks. The web was an anomaly, but as its proponents and participants acquired more power in society, society sought to regulate the rougher edges (for better or worse).
- scsilver 5y ago
  Decentralized securities havfe a different flavor than traditional securities, I like whos in charge, Gensler, to determine how they are going to regulate them if they are considered securities.
- dataflow 5y ago
  > with all the inevitable pitfalls it will have Exhibit A (which I routinely get downvoted for mentioning on HN, as nobody likes to hear it): Ransomware
  - jandrese 5y ago
    Exhibit B: Drugs Sadly you can't buy your getaway car with Bitcoin anymore.
    - ludamad 5y ago
      My friend bought some weed. Some years later, it turned out that could have funded a down-payment if he held the BTC. I'm not sure he talks fondly of his user experience
- Barrin92 5y ago
  >"I keep hearing about all these amazing crypto products, yet outside of this very specific scene, where curiously only the VCs and devs involved wax poetic about it, you can never seem to find a real customer talking about their experience." because there is none. A paper[1] described this as 'Veblenian Entrepreneurship'. Being 'in crypto' isn't actually about producing any tangible goods or services, but consuming the 'crypto/entrepreneur' lifestyle. It's a way for people to LARP as technologists or entrepreneurs without actually producing anything of use to the general public at large. [1]https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3479042 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3479042
LiquidSky 5y ago
>It wouldn't have been good for the US to stifle the web 25 years ago Bitcoin was developed in 2008. The WWW opened to the general public in 1991. This would be the equivalent of the US government starting to regulate the web in 2004. Crypto enthusiasts like to pretend we're still in the early days to try and deal with the extremely embarrassing reality that almost a decade and a half on it's still utterly useless.
- atatatat 5y ago
  That's like saying webapps are useless because users go to the app store first.
matheusmoreira 5y ago
> It's completely reasonable to tax investment earnings. Why? Don't americans have access to tax-free investment accounts like Roth?
- uncomputation 5y ago
  They are only tax free if you are older than 60 and wait a 5 year holding period to prevent this exact evasion.

metalliqaz 5y ago

Why can't you do run of the mill Web3 development without transferring >$10K ???

christiansakai 5y ago
You need to pay gas fees to transfer/execute smart contracts.

pradn 5y ago

It seems to me that the US government is doing this at the right time. We're not in the early stages of cryptocurrency. We've had 10 years for lots of new ideas to mature, and we're on the verge of the most promising of all - Etherium transitioning from PoW to PoS. I'd say this is somewhat late given the Bitcoin/Etherium's popularity among small investors with much to lose, immense greenhouse gas emissions, and facilitation of ransomware and dark markets. Any crytocurrency good enough to be useful will be large enough to have an ecosystem that complies with these rules. Our society regulates money exchange for a reason. It can be put to tremendous negative use - funding criminal activities, siphoning money from public investment, etc.

noofen 5y ago
> It can be put to tremendous negative use - funding criminal activities, siphoning money from public investment, etc. And just like fiat, these activities will continue in the shadows, while innovation is harmed by regulation.
deleted 5y ago
[deleted]

Daishiman 5y ago

I keep hearing about all these amazing crypto products, yet outside of this very specific scene, where curiously only the VCs and devs involved wax poetic about it, you can never seem to find a real customer talking about their experience. You either acknowledge that cryptocurrencies look close enough to currencies or securities and regulate them as such, or you promote them for illegal and ambiguously legal reasons for which there is little rationale for a commercial endeavor. Anything else is just basically letting people slowly reinvent the finance system, with all the inevitable pitfalls it will have. Yes, it's regulated, so are most industries that have substantial systemic risks. The web was an anomaly, but as its proponents and participants acquired more power in society, society sought to regulate the rougher edges (for better or worse).

scsilver 5y ago
Decentralized securities havfe a different flavor than traditional securities, I like whos in charge, Gensler, to determine how they are going to regulate them if they are considered securities.
dataflow 5y ago
> with all the inevitable pitfalls it will have Exhibit A (which I routinely get downvoted for mentioning on HN, as nobody likes to hear it): Ransomware
- jandrese 5y ago
  Exhibit B: Drugs Sadly you can't buy your getaway car with Bitcoin anymore.
  - ludamad 5y ago
    My friend bought some weed. Some years later, it turned out that could have funded a down-payment if he held the BTC. I'm not sure he talks fondly of his user experience
Barrin92 5y ago
>"I keep hearing about all these amazing crypto products, yet outside of this very specific scene, where curiously only the VCs and devs involved wax poetic about it, you can never seem to find a real customer talking about their experience." because there is none. A paper[1] described this as 'Veblenian Entrepreneurship'. Being 'in crypto' isn't actually about producing any tangible goods or services, but consuming the 'crypto/entrepreneur' lifestyle. It's a way for people to LARP as technologists or entrepreneurs without actually producing anything of use to the general public at large. [1]https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3479042 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3479042

LiquidSky 5y ago

>It wouldn't have been good for the US to stifle the web 25 years ago Bitcoin was developed in 2008. The WWW opened to the general public in 1991. This would be the equivalent of the US government starting to regulate the web in 2004. Crypto enthusiasts like to pretend we're still in the early days to try and deal with the extremely embarrassing reality that almost a decade and a half on it's still utterly useless.

atatatat 5y ago
That's like saying webapps are useless because users go to the app store first.

matheusmoreira 5y ago

> It's completely reasonable to tax investment earnings. Why? Don't americans have access to tax-free investment accounts like Roth?

uncomputation 5y ago
They are only tax free if you are older than 60 and wait a 5 year holding period to prevent this exact evasion.