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I'm pretty sure that alternative currencies are illegal in the united states -- wasn't their a big fiasco with the FBI raiding the people making liberty dollars

I'm pretty sure that alternative currencies are illegal in the united states -- wasn't their a big fiasco with the FBI raiding the people making liberty dollars? I think this makes it illegal: http://www.law.cornell.edu/uscode/18/514.html http://www.law.cornell.edu/uscode/18/514.html Also, there may be tax issues. If you have an alternative currency and the us dollar is inflated do you have to pay capital gains taxes on the growth in value of the alternative currency? There are also probably issues with money laundering -- in other words I don't think we can say that they exist, without a caveat about the legal limbo in which they exist.

cchooper 18y ago
They're definitely not illegal, although certain forms are illegal. That law only covers attempts to create currencies that could be mistaken for US dollars. Other systems are illegal because they amount to an unregulated form of banking, or because they are used for laundering. For tax: it depends on the currency in question. Barter systems that use a currency to settle barter accounts are taxed as normal income. Systems such as Time Dollars are considered tax free because they are used for non-commercial activities (http://www.timebanks.org/faqs.htm#taxexempt http://www.timebanks.org/faqs.htm#taxexempt). In China, there exists at least one system that is considered tax-exempt, except when the currency is exchanged for real currency, in which case it is subject to tax.