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I'm actually a little confused by the text. (source: https://twitter.com/jerrybrito/status/1423429377459736577 https://twitter.com/jerrybrito/status/1423429377

by vitus 5y ago

I'm actually a little confused by the text. (source: https://twitter.com/jerrybrito/status/1423429377459736577 https://twitter.com/jerrybrito/status/1423429377459736577) The exclusion is for "validating distributed ledger transactions through proof of work (mining)" -- is that meant to cover validation by any full Bitcoin node (e.g. random person who wants full control over transactions involving a personal wallet), or adding new transactions to the ledger via mining? (I guess, this basically comes down to what's meant by "validating through proof of work" -- the actual PoW is provided by the miner, but other full nodes are needed to validate the actual transaction.) Because to me, either the validators are affected (thereby significantly impacting the overall robustness of the network, which I would hope reduces its trustworthiness and therefore the currency's value as a result, as well as the ability for individuals to control their own wallets), or miners are affected directly.

Taek 5y ago
The text is "validating... through proof of work (mining)", which would seem to imply that it only protects miners. It does seem though like the author's of the text are missing a super important distinction, which is that proof of work mining is _not_ intended to be the main method through which blockchain transactions are validated. The participants in the network are all expected to validate the transactions themselves (independent of the miners). A mistake like this really suggests that the proposed regulation is not well thought out, and that it should probably be revisited after further education and discussion. Worth saying a million times: the massive uproar in the crypto industry this week is not because we don't want to be regulated. It's because these proposed regulations are: + massively over-reaching + proposed at the last minute + attached to a must-pass bill + given very little room for proper discourse
- SV_BubbleTime 5y ago
  > A mistake like this really suggests that the proposed regulation is not well thought out, and that it should probably be revisited after further education and discussion. What kind of sarcasm is most appropriate here? A coy shocked face or faux outrage?
- vitus 5y ago
  Right, that seems to be the consensus read. I guess my point is that even PoW systems won't be entirely unaffected (albeit not quite to the extent that PoS systems are), since validators are crucial to the integrity of the blockchain. To attempt to extend the electric car ban analogy: this feels like adding onerous/infeasible reporting requirements to pipeline operators (PoW validators) and power plants (PoS stakers), neither of whom know anything about the end customer refueling at the pump / charger station, but not the oil refineries (PoW miners). And yes, the reporting requirements would also be in place for the electric utility (PoS validators), which still doesn't know anything about the charger station's customers.
- SamPatt 5y ago
  It's also worth stating that crypto is already regulated. If people are avoiding taxes that's already illegal. This is an attempt to expand surviellance to make revenue collection easier for the state. Excuse me if I'm not thrilled about the state having even more information about our lives. I pay my taxes to avoid being jailed, but they're never satisfied until they have complete control over society.
- r00tanon 5y ago
  For the moment believing that this proposed amendment isn't just some tactic related to getting (or not getting) infrastructure legislation done... For many reasons this regulation would be unenforceable and/or impossible to comply with. How would a miner be able to fill out a 1099?
tboyd47 5y ago
I felt the same way about the text. In Bitcoin, it could either be interpreted as exempting both miners and node operators or neither. That is because the Bitcoin node software does both validation and mining, but the economic environment and network topology means typically people running the software will only do one of the two. Very strange turn of events.

by vitus 5y ago

Taek 5y ago

The text is "validating... through proof of work (mining)", which would seem to imply that it only protects miners. It does seem though like the author's of the text are missing a super important distinction, which is that proof of work mining is _not_ intended to be the main method through which blockchain transactions are validated. The participants in the network are all expected to validate the transactions themselves (independent of the miners). A mistake like this really suggests that the proposed regulation is not well thought out, and that it should probably be revisited after further education and discussion. Worth saying a million times: the massive uproar in the crypto industry this week is not because we don't want to be regulated. It's because these proposed regulations are: + massively over-reaching + proposed at the last minute + attached to a must-pass bill + given very little room for proper discourse

SV_BubbleTime 5y ago
> A mistake like this really suggests that the proposed regulation is not well thought out, and that it should probably be revisited after further education and discussion. What kind of sarcasm is most appropriate here? A coy shocked face or faux outrage?
vitus 5y ago
Right, that seems to be the consensus read. I guess my point is that even PoW systems won't be entirely unaffected (albeit not quite to the extent that PoS systems are), since validators are crucial to the integrity of the blockchain. To attempt to extend the electric car ban analogy: this feels like adding onerous/infeasible reporting requirements to pipeline operators (PoW validators) and power plants (PoS stakers), neither of whom know anything about the end customer refueling at the pump / charger station, but not the oil refineries (PoW miners). And yes, the reporting requirements would also be in place for the electric utility (PoS validators), which still doesn't know anything about the charger station's customers.
SamPatt 5y ago
It's also worth stating that crypto is already regulated. If people are avoiding taxes that's already illegal. This is an attempt to expand surviellance to make revenue collection easier for the state. Excuse me if I'm not thrilled about the state having even more information about our lives. I pay my taxes to avoid being jailed, but they're never satisfied until they have complete control over society.
r00tanon 5y ago
For the moment believing that this proposed amendment isn't just some tactic related to getting (or not getting) infrastructure legislation done... For many reasons this regulation would be unenforceable and/or impossible to comply with. How would a miner be able to fill out a 1099?

tboyd47 5y ago

I felt the same way about the text. In Bitcoin, it could either be interpreted as exempting both miners and node operators or neither. That is because the Bitcoin node software does both validation and mining, but the economic environment and network topology means typically people running the software will only do one of the two. Very strange turn of events.