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If decentralized means outside the ability of regulators to regulate, then is also needs to be “detached” in the sense that no money can exchange in or out. Any

If decentralized means outside the ability of regulators to regulate, then is also needs to be “detached” in the sense that no money can exchange in or out. Any company that accepts or disburses money (in a “currency”) as a component of its DeFi can be regulated. Basically, in-game currency.

3np 5y ago
> Any company that accepts or disburses money (in a “currency”) as a component of its DeFi can be regulated. That’s the point. If you run a business and take custody of customer funds you’re on the hook. With real decentralized solutions this is obsolete and legacy. AFAIK, simply accepting payment in cryptocurrency for goods and services does not make you a VASP under currently proposed legislation. It’s going to be interesting to see and decisive where different countries draw the line of what constitutes a VASP. > If decentralized means outside the ability of regulators to regulate, then is also needs to be “detached” in the sense that no money can exchange in or out I don’t see how that follows. You will have regulated VASPs requiring KYC/AML from their customers (much like banks etc In traditional finance). Then you have individuals doing peer-to-peer transactions. Those who transact between assets and yield profit will have to pay capital gains tax on that. (Unless by “money”/“currency” here you’re referring to fiat currency and not cryptocurrency? In that case yeah. But we have stablecoins. My argument is that the regulation and enforcement actually serves to accelerate the adoption, since touching fiat or working as a traditional company is becoming increasingly encumbered with red tape)
- quantified 5y ago
  Yes, I meant fiat currency (US dollars, etc.). I get that the point is to have a parallel currency of crypto. If I purchase a stablecoin with fiat, I’ve exchanged, there it is. If I earn my salary in crypto, pay for my groceries, and never exchange for fiat, then I’m fully detached.
  - 3np 5y ago
    I still don’t see how that follows for individuals. As long as you’re self-reporting and paying relevant taxes, you’re in the clear. Even if you use privacy-preserving technology to protect yourself from surveillance from private and foreign interests, you should still keep records that can be submitted as proof to tax authorities if required. (Maybe the approach of legislators and regulatory bodies will change; this is reflecting my understanding of recent developments)
    - quantified 5y ago
      My point was that the regulatory system connects to how money moves. The interfaces where money comes in and out are places that regulation easily touches. I rather doubt the SEC would care if money wasn’t involved (purely in-game currency).

3np 5y ago

> Any company that accepts or disburses money (in a “currency”) as a component of its DeFi can be regulated. That’s the point. If you run a business and take custody of customer funds you’re on the hook. With real decentralized solutions this is obsolete and legacy. AFAIK, simply accepting payment in cryptocurrency for goods and services does not make you a VASP under currently proposed legislation. It’s going to be interesting to see and decisive where different countries draw the line of what constitutes a VASP. > If decentralized means outside the ability of regulators to regulate, then is also needs to be “detached” in the sense that no money can exchange in or out I don’t see how that follows. You will have regulated VASPs requiring KYC/AML from their customers (much like banks etc In traditional finance). Then you have individuals doing peer-to-peer transactions. Those who transact between assets and yield profit will have to pay capital gains tax on that. (Unless by “money”/“currency” here you’re referring to fiat currency and not cryptocurrency? In that case yeah. But we have stablecoins. My argument is that the regulation and enforcement actually serves to accelerate the adoption, since touching fiat or working as a traditional company is becoming increasingly encumbered with red tape)

quantified 5y ago
Yes, I meant fiat currency (US dollars, etc.). I get that the point is to have a parallel currency of crypto. If I purchase a stablecoin with fiat, I’ve exchanged, there it is. If I earn my salary in crypto, pay for my groceries, and never exchange for fiat, then I’m fully detached.
- 3np 5y ago
  I still don’t see how that follows for individuals. As long as you’re self-reporting and paying relevant taxes, you’re in the clear. Even if you use privacy-preserving technology to protect yourself from surveillance from private and foreign interests, you should still keep records that can be submitted as proof to tax authorities if required. (Maybe the approach of legislators and regulatory bodies will change; this is reflecting my understanding of recent developments)
  - quantified 5y ago
    My point was that the regulatory system connects to how money moves. The interfaces where money comes in and out are places that regulation easily touches. I rather doubt the SEC would care if money wasn’t involved (purely in-game currency).