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Unpopular opinion of the day: bitcoin is real money, and the government will regulate it and control it as such. In my opinion, the end-game is this: bitcoin a

by pnathan 13y ago

Unpopular opinion of the day: bitcoin is real money, and the government will regulate it and control it as such. In my opinion, the end-game is this: bitcoin addresses are taxable, with occasional tax agents spot-checking large accumulations of bitcoin to determine if said addresses fall within their jurisdiction. Bitcoin has the unusual ability to have a very tight trace on where a given virtual coin goes: that just makes the ability to watch the money easier.

rayiner 13y ago
I don't know why this should be unpopular, except among people who see the Internet as a new Wild West. The basic advantage of Bitcoin, that its controlled by an algorithm rather than a central bank, exists whether or not financial regulations apply to Bitcoin. Does it destroy the utility of a crypto currency for exchanges and processors to be required to detect e.g. money laundering?
- antitrust 13y ago
  > the Internet as a new Wild West I thought that idea died, was buried, exhumed, and reburied back in 1996.
  - rayiner 13y ago
    I don't think it's dead. I think a lot of people romanticize things like Bitcoin as being part of a world that's lawless relative to the real one. And as hackers, it's one where the lack of order favors them, just as the lack of order in the Wild West favored those with the most horses and guns.
    - _delirium 13y ago
      I'm not sure that analogy plays out well for hackers in the long term. Ultimately, the wild west was not won by cowboys with some horses and guns, but large-scale ranchers with title to hundreds of thousands of acres. The cowboys may still have movies made about them, but the likes of King Ranch came out on top economically.
      - wmf 13y ago
        Yeah, there are some fairly lawless places on Earth today and you don't see many people (other than rdl) moving there to make their fortune. People subconsciously prefer the rule of law but it's cool to romanticize Bitcoin data havens and whatnot.
        qu4z-2 13y ago
        In fairness, people might want laws about not being stabbed, while still being okay with not having laws about sharing information online.
      - scarecrowbob 13y ago
        I believe it is more correct to think of cowboys along the terms of freelancers and lifestyle business folks... people who don't need massive success, just freedom from having to be at a highly structured job from 9-5. Or at least that is the idea that I get from the many I know or have met. In that sense, the larger market "winners" like the king ranch aren't really a factor, except as their presence begins to foment regulations that must apply to every single person and begin to restructure the world into one where it is increasingly difficult to live outside of a corporate structure.... ie. they fence off formerly commonly held land.
    - antitrust 13y ago
      BRB, need horses and guns.
  - dylangs1030 13y ago
    Nope. A casual perusal of Hacker News and reddit will show this mentality is very much alive, and that people believe this is the only way the internet should be. Free, international waters where anything goes and there shouldn't be any government involvement.
  - pnathan 13y ago
    No, that meme lives. It just refashioned itself. Look carefully at HN + Reddit to see its traces.
- VMG 13y ago
  > Does it destroy the utility of a crypto currency for exchanges and processors to be required to detect e.g. money laundering? It introduces a mandatory third party (the government) to transactions where only two parties are intended. Such a virtual currency could be designed, and I don't believe it would be successful. The Bitcoin protocol allows two parties to transact without any outside interference. If governments can restrict using a protocol remains to be seen.
  - betterunix 13y ago
    "The Bitcoin protocol allows two parties to transact without any outside interference" ...other than the entire Bitcoin network, right? When last I checked the design of Bitcoin called for transactions to be checked by other Bitcoin users and then broadcast to the entire network. That is about as far as one can get from a two party transaction. If you want real two party transactions, you probably want this sort of thing: http://blog.koehntopp.de/uploads/chaum_fiat_naor_ecash.pdf http://blog.koehntopp.de/uploads/chaum_fiat_naor_ecash.pdf
    - Tehnix 13y ago
      the network doesn't interfere, they do nothing to the transactions. They are there to act as a safe-guard against double spending, among others, by "validating" them.
- revelation 13y ago
  It's the wild west, except not a single person ever died from it. It's a communications network. I'm all for treating it as the wild-west, self regulating thing it is. Applying this logic, mail is the old Wild West.
  - rayiner 13y ago
    Nobody has died in the Internet, but money has been stolen and commerce has been interfered with, and that was one of the major drivers behind the taming of the Wild West. Stage coach robberies and train holdups.
    - AnthonyMouse 13y ago
      I'm assuming the reason somebody downvoted you is the implicit assumption that saving fat cat bankers from middle class teenagers justifies turning the Internet into cable TV. I want to make the other point. You're claiming it was about commerce rather than loss of life and then using examples where there was often loss of life.
      - rayiner 13y ago
        That is the characterization, isn't it? Middle class teenagers versus fat cat bankers. But in reality it's often middle class teenagers or even organized Russian criminals against gullible old people who are susceptible to pishing tricks. 140 years ago, you might as well have been talking about middle class guys versus fat cat railroad companies. There was often loss of life during train robberies, but the economic disruption was a major component. People knew Jesse James for all the trains he robbed, not the people he killed.
    - hawleyal 13y ago
      lolwut
DougWebb 13y ago
A bitcoin address is just a container for some amount of BTC. Holding an amount of currency isn't taxable, and exchanging currency often isn't taxable either. (I'm generalizing across jurisdictions, but I think what I'm saying is true for most of them.) If you move money from one pocket to another, or one savings account to another (that you own), that's not taxable. Very many transfers between bitcoin addresses is just like that: the 'change' from a transfer goes to a new address owned by the same person. Even when the addresses are owned by two different people, the transfer often isn't taxable. You don't pay a tax when you pay a bill, but that's a currency transfer between two parties. Even when you buy something it isn't necessarily taxable; in many jurisdictions many products are sold tax-free based on either the type of product or where the buyer and/or seller are based. I don't think there's a way to enforce taxation on bitcoin that's not already being used to enforce cash sales taxes and cash income, despite the tracability of the coins, because the address owners may not be identifiable, and the nature of the transfer is definitely not identifiable from the blockchain.
- deleted 13y ago
  [deleted]
- Thiz 13y ago
  Great explanation. Ignore my ignorance in crypto stuff, so, what's stopping us from creating a hundred accounts in one computer and having a couple of bitcoins in each one of them? Or even spread in one hundred shared peer-to-peer bank services?
  - marcell 13y ago
    Nothing stops you from create hundreds or even millions of bitcoin addresses, which can act as "accounts." Edit: A bitcoin address is a 160-bit number. That number is associated with a public and private key. The only way you can spend bitcoins stored in an address is if you know the private key of that address. For more information, this video gives a fairly in depth explanation: http://www.youtube.com/watch?v=Lx9zgZCMqXE http://www.youtube.com/watch?v=Lx9zgZCMqXE
    - 13y ago
flyinglizard 13y ago
This is why I don't believe in BTC for the long term. It's not anywhere near anonymous. Those saying BTC has no inherent value (as opposed to gold, for example) are completely overlooking the fact that BTC is the only kind of exchange that can be used for illicit activities in a relatively untraceable manner (good luck buying stuff on SR using gold). Unfortunately, BTC is traceable if governments decide to spend the resources monitoring transactions, and I suspect this would be the primary motivator in the demise of BTC and a replacement with a more anonymous currency - the other motivator being that there's a huge financial upside for being an inventor or early adopter of a successful cryptocurrency, as BTC shown us.
- tazzy531 13y ago
  Isn't BTC's public ledger public? (https://blockchain.info/ https://blockchain.info/) While it's possible to generate a new wallet to mask who the user is, the transaction flow can be traceable. This seems easier to trace than the flow of money through our banking system.
  - mordae 13y ago
    Yes, the BTC can be traced, but they cannot be associated with physical people until they identify themselves. Your anonymity is limited by trustworthiness of the person selling you the coins and the person you are buying physical goods from.
- mtgx 13y ago
  There is this proposed extension for anonymity, but I don't think it's very likely it will be implemented: http://zerocoin.org/ http://zerocoin.org/
- necubi 13y ago
  People claiming BTC has no inherent value aren't talking about the general concept or code—they're referring to this particular blockchain.
- LekkoscPiwa 13y ago
  However, BTC is just a great example that might find followers who will make it hmmmm... more anonymous. Money has just two functions: (1) It has to maintain its value over time (2) People must accept it as means of setting payments BTC seems to meet both. It's not anonymous "enough", but I guess this could be fixed with another iteration. (another electronic currency). It would be great for the world to have more currencies than the monopolistic currencies enforced by the modern states (fiat currencies). Just to own something that doesn't have its monetary base doubled in 4 years, would be awesome! (USD base rose two times from 2008 to 2012).
mtgx 13y ago
I think in the short term at least, this is beneficial for Bitcoin, if it's recognized as money, and businesses and "normal" people start trusting to use it without fearing repercussions from the government, as long as they "follow the rules". This could lead to more centralized exchanges, which again is good in the short term - the more the merrier, so people can easily get Bitcoin with their dollars. But I think the end game for Bitcoin is to be a "real currency" that gets used everywhere and people get paid in it, to the point where a lot of people won't need to exchange to dollars necessarily. At that point you could start living entirely with Bitcoins, and you won't need centralized services anymore either. You can just use your own local wallet, whether it's on your PC, smartphone, or NFC ring. Tracking the transactions through services like Coinbase or Mtgox is obviously going to be trivial for the authorities, since they can just request the data tied to people's names. But it's going to be a lot harder to see them when you're using local wallets, unless the IRS is still receiving help from the NSA at that point, because you'll probably need something like the mass surveillance system of NSA tracking every transaction from the whole Internet, and using Big Data to identify who's buying what. But hopefully by then we'll fix the NSA "problem".
- Nursie 13y ago
  Local wallets is not a really accurate term - all BTC transactions go in the public ledger. It's kinda one of the flaws of bitcoin, there's no such thing as an offline transaction.
  - rak 13y ago
    I think the go is trying to distinguish between wallets associated with a known identity through exchanges/services and ones that are not.
- pnathan 13y ago
  Right now we're mid-game with btc. It appears that the implicit strategy by the authorities is to treat it as a functioning currency. Fine then; that is good for btc's long-term success. It also implies that the tax-man is coming. btc is not going to live as wildcat currency used by the fringe, untaxed and destroying economic supremacy (That is to say, I disagree with the idea that btc will destroy the economic system that some people favor). Also, the blockchain is 100% public. So if you can tie a btc address to a real person (perhaps via tax returns requiring you to declare your virtual currency addresses), then the entire pseudo-nymousness of btc goes out the door. Things to think about.
coinman 13y ago
In a way, bitcoin itself is not really a currency, or money, it's more like an idea for exchanging messages. Bitcoin is really a decentralized messaging system which relies on cryptography and proof-of-work to maintain integrity. Should exchanging messages in the form of "I owe you x amount" over a p2p network be regulated or be made illegal? However, The fact that it's used as a form of currency is just an interpretation of what Bitcoin is. There can be other interpretations for what bitcoin-type system can be used for, for example Namecoin is used for name registrations. The judge declared that bitcoin is money by making an interpretation. If anything, Bitcoin is just software. It will be very difficult to regulate. 1. Software using encryption is protected speech (http://en.wikipedia.org/wiki/Bernstein_v._United_States http://en.wikipedia.org/wiki/Bernstein_v._United_States). Regulating bitcoin as in bitcoin the software would be a form of censorship. 2. Bitcoin uses many of the standard principles of cryptography we already use in e-commerce. Banning cryptography would have enormous consequences for the economy of the internet in general. 3. Banning or regulating p2p would cause an uproar. 4. If buying bitcoins in exchange for dollars is really exchanging a string of bits for money, then if this is banned or regulated, would it also ban buying software or other digital goods for money? 5. The regulations can't be too broad, but can't be too narrow. Would the laws restrict only bitcoin as a currency or other applications of bitcoin as well? If too broad, then they will unintentionally restrict other uses of bitcoin too. If too narrow, a new system will pop up again.
- lutusp 13y ago
  > In a way, bitcoin itself is not really a currency, or money, it's more like an idea for exchanging messages. It's a way to convey messages, but the messages represent value in the same way that paper money does. If bitcoins can be exchanged for goods and services, then they represent the value of those goods and services, just like paper money. An electronic message describing a transaction involving dollars, or euros, or some other wealth representation, is just a message about a transaction. But a bitcoin is the wealth representation -- it doesn't require, or refer to, another medium of exchange. Your argument tries to deny the identity of bitcoins as currency, but that isn't so -- they're currency.
  - 13y ago
meowface 13y ago
I doubt they'd bother trying to tax transactions from one Bitcoin address to another. It'd be incredibly infeasible. They will probably start requiring that all vendors who exchange real world currency or commodities for Bitcoin pay taxes on all such trades, however. Which isn't all that unreasonable.
- rsynnott 13y ago
  It would seem far less infeasible than taxing cash transactions (far easier to trace), and cash transactions are certainly a thing of great interest to tax authorities.
nilved 13y ago
> Unpopular opinion of the day: bitcoin is real money, and the government will regulate it and control it as such. Which government?
- samstave 13y ago
  There is only one, the NSA
- tg3 13y ago
  Over time, likely all of them.
- lewispollard 13y ago
  Was just thinking that. Say the US govt does put regulations on Bitcoin, do those regulations apply to me in as a UK citizen?
darkchasma 13y ago
Of course it is. If at any point where you think you have created a technology that will be tax free, it will only remain so until it becomes economically viable for the governments to tax it. We only have to look to Mass. software tax to realize this is the case, even when the implementation doesn't make a lick of sense.
kaonashi 13y ago
Real money is a government IOU that can be redeemed to fulfill your tax obligation. Bitcoin fulfills neither of these. It's simply a receipt for wasted electricity.
tudorw 13y ago
I like paying tax, I use bitcoin for other reasons, who does not like to have schools and hospitals and the other things that come with taxes ?

by pnathan 13y ago

rayiner 13y ago

I don't know why this should be unpopular, except among people who see the Internet as a new Wild West. The basic advantage of Bitcoin, that its controlled by an algorithm rather than a central bank, exists whether or not financial regulations apply to Bitcoin. Does it destroy the utility of a crypto currency for exchanges and processors to be required to detect e.g. money laundering?

antitrust 13y ago
> the Internet as a new Wild West I thought that idea died, was buried, exhumed, and reburied back in 1996.
- rayiner 13y ago
  I don't think it's dead. I think a lot of people romanticize things like Bitcoin as being part of a world that's lawless relative to the real one. And as hackers, it's one where the lack of order favors them, just as the lack of order in the Wild West favored those with the most horses and guns.
  - _delirium 13y ago
    I'm not sure that analogy plays out well for hackers in the long term. Ultimately, the wild west was not won by cowboys with some horses and guns, but large-scale ranchers with title to hundreds of thousands of acres. The cowboys may still have movies made about them, but the likes of King Ranch came out on top economically.
    - wmf 13y ago
      Yeah, there are some fairly lawless places on Earth today and you don't see many people (other than rdl) moving there to make their fortune. People subconsciously prefer the rule of law but it's cool to romanticize Bitcoin data havens and whatnot.
      - qu4z-2 13y ago
        In fairness, people might want laws about not being stabbed, while still being okay with not having laws about sharing information online.
    - scarecrowbob 13y ago
      I believe it is more correct to think of cowboys along the terms of freelancers and lifestyle business folks... people who don't need massive success, just freedom from having to be at a highly structured job from 9-5. Or at least that is the idea that I get from the many I know or have met. In that sense, the larger market "winners" like the king ranch aren't really a factor, except as their presence begins to foment regulations that must apply to every single person and begin to restructure the world into one where it is increasingly difficult to live outside of a corporate structure.... ie. they fence off formerly commonly held land.
  - antitrust 13y ago
    BRB, need horses and guns.
- dylangs1030 13y ago
  Nope. A casual perusal of Hacker News and reddit will show this mentality is very much alive, and that people believe this is the only way the internet should be. Free, international waters where anything goes and there shouldn't be any government involvement.
- pnathan 13y ago
  No, that meme lives. It just refashioned itself. Look carefully at HN + Reddit to see its traces.
VMG 13y ago
> Does it destroy the utility of a crypto currency for exchanges and processors to be required to detect e.g. money laundering? It introduces a mandatory third party (the government) to transactions where only two parties are intended. Such a virtual currency could be designed, and I don't believe it would be successful. The Bitcoin protocol allows two parties to transact without any outside interference. If governments can restrict using a protocol remains to be seen.
- betterunix 13y ago
  "The Bitcoin protocol allows two parties to transact without any outside interference" ...other than the entire Bitcoin network, right? When last I checked the design of Bitcoin called for transactions to be checked by other Bitcoin users and then broadcast to the entire network. That is about as far as one can get from a two party transaction. If you want real two party transactions, you probably want this sort of thing: http://blog.koehntopp.de/uploads/chaum_fiat_naor_ecash.pdf http://blog.koehntopp.de/uploads/chaum_fiat_naor_ecash.pdf
  - Tehnix 13y ago
    the network doesn't interfere, they do nothing to the transactions. They are there to act as a safe-guard against double spending, among others, by "validating" them.
revelation 13y ago
It's the wild west, except not a single person ever died from it. It's a communications network. I'm all for treating it as the wild-west, self regulating thing it is. Applying this logic, mail is the old Wild West.
- rayiner 13y ago
  Nobody has died in the Internet, but money has been stolen and commerce has been interfered with, and that was one of the major drivers behind the taming of the Wild West. Stage coach robberies and train holdups.
  - AnthonyMouse 13y ago
    I'm assuming the reason somebody downvoted you is the implicit assumption that saving fat cat bankers from middle class teenagers justifies turning the Internet into cable TV. I want to make the other point. You're claiming it was about commerce rather than loss of life and then using examples where there was often loss of life.
    - rayiner 13y ago
      That is the characterization, isn't it? Middle class teenagers versus fat cat bankers. But in reality it's often middle class teenagers or even organized Russian criminals against gullible old people who are susceptible to pishing tricks. 140 years ago, you might as well have been talking about middle class guys versus fat cat railroad companies. There was often loss of life during train robberies, but the economic disruption was a major component. People knew Jesse James for all the trains he robbed, not the people he killed.
  - hawleyal 13y ago
    lolwut

DougWebb 13y ago

A bitcoin address is just a container for some amount of BTC. Holding an amount of currency isn't taxable, and exchanging currency often isn't taxable either. (I'm generalizing across jurisdictions, but I think what I'm saying is true for most of them.) If you move money from one pocket to another, or one savings account to another (that you own), that's not taxable. Very many transfers between bitcoin addresses is just like that: the 'change' from a transfer goes to a new address owned by the same person. Even when the addresses are owned by two different people, the transfer often isn't taxable. You don't pay a tax when you pay a bill, but that's a currency transfer between two parties. Even when you buy something it isn't necessarily taxable; in many jurisdictions many products are sold tax-free based on either the type of product or where the buyer and/or seller are based. I don't think there's a way to enforce taxation on bitcoin that's not already being used to enforce cash sales taxes and cash income, despite the tracability of the coins, because the address owners may not be identifiable, and the nature of the transfer is definitely not identifiable from the blockchain.

deleted 13y ago
[deleted]
Thiz 13y ago
Great explanation. Ignore my ignorance in crypto stuff, so, what's stopping us from creating a hundred accounts in one computer and having a couple of bitcoins in each one of them? Or even spread in one hundred shared peer-to-peer bank services?
- marcell 13y ago
  Nothing stops you from create hundreds or even millions of bitcoin addresses, which can act as "accounts." Edit: A bitcoin address is a 160-bit number. That number is associated with a public and private key. The only way you can spend bitcoins stored in an address is if you know the private key of that address. For more information, this video gives a fairly in depth explanation: http://www.youtube.com/watch?v=Lx9zgZCMqXE http://www.youtube.com/watch?v=Lx9zgZCMqXE
  - 13y ago

flyinglizard 13y ago

This is why I don't believe in BTC for the long term. It's not anywhere near anonymous. Those saying BTC has no inherent value (as opposed to gold, for example) are completely overlooking the fact that BTC is the only kind of exchange that can be used for illicit activities in a relatively untraceable manner (good luck buying stuff on SR using gold). Unfortunately, BTC is traceable if governments decide to spend the resources monitoring transactions, and I suspect this would be the primary motivator in the demise of BTC and a replacement with a more anonymous currency - the other motivator being that there's a huge financial upside for being an inventor or early adopter of a successful cryptocurrency, as BTC shown us.

tazzy531 13y ago
Isn't BTC's public ledger public? (https://blockchain.info/ https://blockchain.info/) While it's possible to generate a new wallet to mask who the user is, the transaction flow can be traceable. This seems easier to trace than the flow of money through our banking system.
- mordae 13y ago
  Yes, the BTC can be traced, but they cannot be associated with physical people until they identify themselves. Your anonymity is limited by trustworthiness of the person selling you the coins and the person you are buying physical goods from.
mtgx 13y ago
There is this proposed extension for anonymity, but I don't think it's very likely it will be implemented: http://zerocoin.org/ http://zerocoin.org/
necubi 13y ago
People claiming BTC has no inherent value aren't talking about the general concept or code—they're referring to this particular blockchain.
LekkoscPiwa 13y ago
However, BTC is just a great example that might find followers who will make it hmmmm... more anonymous. Money has just two functions: (1) It has to maintain its value over time (2) People must accept it as means of setting payments BTC seems to meet both. It's not anonymous "enough", but I guess this could be fixed with another iteration. (another electronic currency). It would be great for the world to have more currencies than the monopolistic currencies enforced by the modern states (fiat currencies). Just to own something that doesn't have its monetary base doubled in 4 years, would be awesome! (USD base rose two times from 2008 to 2012).

mtgx 13y ago

I think in the short term at least, this is beneficial for Bitcoin, if it's recognized as money, and businesses and "normal" people start trusting to use it without fearing repercussions from the government, as long as they "follow the rules". This could lead to more centralized exchanges, which again is good in the short term - the more the merrier, so people can easily get Bitcoin with their dollars. But I think the end game for Bitcoin is to be a "real currency" that gets used everywhere and people get paid in it, to the point where a lot of people won't need to exchange to dollars necessarily. At that point you could start living entirely with Bitcoins, and you won't need centralized services anymore either. You can just use your own local wallet, whether it's on your PC, smartphone, or NFC ring. Tracking the transactions through services like Coinbase or Mtgox is obviously going to be trivial for the authorities, since they can just request the data tied to people's names. But it's going to be a lot harder to see them when you're using local wallets, unless the IRS is still receiving help from the NSA at that point, because you'll probably need something like the mass surveillance system of NSA tracking every transaction from the whole Internet, and using Big Data to identify who's buying what. But hopefully by then we'll fix the NSA "problem".

Nursie 13y ago
Local wallets is not a really accurate term - all BTC transactions go in the public ledger. It's kinda one of the flaws of bitcoin, there's no such thing as an offline transaction.
- rak 13y ago
  I think the go is trying to distinguish between wallets associated with a known identity through exchanges/services and ones that are not.
pnathan 13y ago
Right now we're mid-game with btc. It appears that the implicit strategy by the authorities is to treat it as a functioning currency. Fine then; that is good for btc's long-term success. It also implies that the tax-man is coming. btc is not going to live as wildcat currency used by the fringe, untaxed and destroying economic supremacy (That is to say, I disagree with the idea that btc will destroy the economic system that some people favor). Also, the blockchain is 100% public. So if you can tie a btc address to a real person (perhaps via tax returns requiring you to declare your virtual currency addresses), then the entire pseudo-nymousness of btc goes out the door. Things to think about.

coinman 13y ago

In a way, bitcoin itself is not really a currency, or money, it's more like an idea for exchanging messages. Bitcoin is really a decentralized messaging system which relies on cryptography and proof-of-work to maintain integrity. Should exchanging messages in the form of "I owe you x amount" over a p2p network be regulated or be made illegal? However, The fact that it's used as a form of currency is just an interpretation of what Bitcoin is. There can be other interpretations for what bitcoin-type system can be used for, for example Namecoin is used for name registrations. The judge declared that bitcoin is money by making an interpretation. If anything, Bitcoin is just software. It will be very difficult to regulate. 1. Software using encryption is protected speech (http://en.wikipedia.org/wiki/Bernstein_v._United_States http://en.wikipedia.org/wiki/Bernstein_v._United_States). Regulating bitcoin as in bitcoin the software would be a form of censorship. 2. Bitcoin uses many of the standard principles of cryptography we already use in e-commerce. Banning cryptography would have enormous consequences for the economy of the internet in general. 3. Banning or regulating p2p would cause an uproar. 4. If buying bitcoins in exchange for dollars is really exchanging a string of bits for money, then if this is banned or regulated, would it also ban buying software or other digital goods for money? 5. The regulations can't be too broad, but can't be too narrow. Would the laws restrict only bitcoin as a currency or other applications of bitcoin as well? If too broad, then they will unintentionally restrict other uses of bitcoin too. If too narrow, a new system will pop up again.

lutusp 13y ago
> In a way, bitcoin itself is not really a currency, or money, it's more like an idea for exchanging messages. It's a way to convey messages, but the messages represent value in the same way that paper money does. If bitcoins can be exchanged for goods and services, then they represent the value of those goods and services, just like paper money. An electronic message describing a transaction involving dollars, or euros, or some other wealth representation, is just a message about a transaction. But a bitcoin is the wealth representation -- it doesn't require, or refer to, another medium of exchange. Your argument tries to deny the identity of bitcoins as currency, but that isn't so -- they're currency.
- 13y ago

meowface 13y ago

I doubt they'd bother trying to tax transactions from one Bitcoin address to another. It'd be incredibly infeasible. They will probably start requiring that all vendors who exchange real world currency or commodities for Bitcoin pay taxes on all such trades, however. Which isn't all that unreasonable.

rsynnott 13y ago
It would seem far less infeasible than taxing cash transactions (far easier to trace), and cash transactions are certainly a thing of great interest to tax authorities.

nilved 13y ago

> Unpopular opinion of the day: bitcoin is real money, and the government will regulate it and control it as such. Which government?

samstave 13y ago
There is only one, the NSA
tg3 13y ago
Over time, likely all of them.
lewispollard 13y ago
Was just thinking that. Say the US govt does put regulations on Bitcoin, do those regulations apply to me in as a UK citizen?

darkchasma 13y ago

Of course it is. If at any point where you think you have created a technology that will be tax free, it will only remain so until it becomes economically viable for the governments to tax it. We only have to look to Mass. software tax to realize this is the case, even when the implementation doesn't make a lick of sense.

kaonashi 13y ago

Real money is a government IOU that can be redeemed to fulfill your tax obligation. Bitcoin fulfills neither of these. It's simply a receipt for wasted electricity.

tudorw 13y ago

I like paying tax, I use bitcoin for other reasons, who does not like to have schools and hospitals and the other things that come with taxes ?