General question. Currently money laundering is illegal (concealing money gained from unlawful activity) [i] and the IRS already asks you specifically if you own assets [digital currency] [ii], so i am honestly curious what this would change. If you own bitcoin and are not disclosing this to the government [irs] of such assets you are already breaking federal law. This just adds charges? Or does this help fund the feds to form task forces? Lawyers I have consulted mention trusts to legally hide assets [iii]. help.
Currently, irs asks you if you have ownership on a foreign account, or finra or something asks you to declare money over 10k when you enter country. They also know your bank accounts by its centralized nature.
Now, if they ask you your wallets, not declaring could be considered unlawful if this bill passes.
Also technically, wince cryptocoins are commodities, or treated as such, you still need to declare them as a profit on tax forms. They didnt have a way to know so you could decide to not tell. You still can but the boundary gets blurry now - you can expect to be asked more about this during audits etc.
> "the IRS already asks you specifically if you own assets [digital currency] [ii]"
I don't see anywhere in [ii] where it specifically says that you have to disclose the mere ownership of personally-held bitcoins. That is just saying that you have treat bitcoin just like any other property.
Not only did she pretend to be incredulous about NSA spying, she put forward the bill to excuse most of it after completely redirecting the conversation to "metadata." Now Ajit Pai made it a partisan issue she's having screaming about being pro net neutrality but a few years back she co-sponsored the PIPA bill!
Worst of all she's considered to be basically impossible to replace. It would be very nice to see CA stop giving her money and put a significant challenger forward but it's probably not good ROI to attempt.
To the downvoters: Seriously it is. For example: Can you imagine what would happen if we allowed people to have bars? People are expected to DRIVE to a BAR and DRINK! Can you imagine what people would do then, if we legalized the existence of bars? People would drive home drunk!
Well, bank secrecy is as dead as governments can make it, for obvious reasons. However, for cryptocurrencies, it's mainly exchange interfaces with meatspace currencies that are hard to keep private.
If you use local wallets like Electrum, transact via Tor, mix thoroughly, and generally practice good OPSEC, your personas and their cryptocurrency can be as anonymous as you like. But only as long as you maintain compartmentalization from meatspace.
The United States has divided into a privileged class vs commoners:
1) PRIVILEGED CLASSES: Easy cheap to create Off-shore shell company legal entity. Hide ownership of your money. It will auto-shift to a new country if government tries to uncover ownership. Offshore laws make it illegal for bank workers to uncover identity
2) COMMONERS: FinCen dominates over commoners. Every transaction tracked. Prison if you have Bitcoin privacy. They can put you in prison if they claim two transactions were because you were trying to get privacy from government.
And currently, bitcoin is too hard to use for terrorists or most criminals. You have to be relatively sophisticated. Yah, you may have gotten your grandma a wallet, but that's not the same as mastering the level of opsec to fund a clandestine organization using cryptocurrencies...
And further, since every transaction is recorded forever in the blockchain if any future address is compromised, the entire network can be compromised instantaneously....
Bitcoin is really worse for terrorist financing than good old USD.
And we "lost" trillions of USD on Pallets in the Iraq and Afghanistan wars.
Good digital currency will be useful to terrorists just as a good internet is. But just as the internet creates a more connected and prosperous world that reduces conflict and terrorism overall, so will digital currency.
Also, it reduces the threats posed by governments against their own people. Government repression, like that seen in Venezuela or for a more extreme example, North Korea, can kill far more people than non-state terrorism, and tools that empower individuals help resist that.
I have no idea. But it's a great way to get relatively anonymous donations. At least, if you educate your donors to mix first. Also, properly mixed Bitcoin is great for anonymously leasing VPN services and servers, and for buying fake Facebook etc accounts, which are all useful for advocacy. And maybe black-market arms dealers accept Bitcoin now.
It’s it about bitcoin as Monero wouldn’t be a terrible idea though, another digital currency
But attempting financial sanctions as a way to deter use? That will be a waste of everyone’s time and money
One idea is if digital currencies get big enough then it will accelerate the insolvency of the state from its obligatory attempts to curb use. Far fetched now, less far fetched than a year ago
The text doesn't sound so much to me like it's criminalizing intentionally concealed ownership of cryptocurrency, as ownership of accounts at exchanges...say, by signing up for an exchange with a fake ID.
> A ‘prepaid access device’ means an electronic device or vehicle, such as a card, plate, code, number, electronic serial number, mobile identification number, personal identification number, or other instrument, that provides a portal to funds or the value of funds that have been paid in advance and can be retrievable and transferable at some point in the future.
To me that seems pretty clear they're targeting cryptocurrencies held outside of exchanges.
That’s irritating. I’ve signed up for a few exchanges with fictitious details, on the basis that their being hacked seems likely. Still declare to HMRC when necessary tho
How do you define "digital currency"? Under US legal tender laws BTC isn't money. You can incur capital gains when you exchange BTC for something over the basis you acquired it for, but you essentially gave smoothing of value away for something ephemeral.
What's the problem with being required to send a plaintext copy of every encrypted email to various government agencies around the world? It's not like that would ban using encrypted email.
> Income from investments is supposed to be reported to the IRS.
Bitcoin income has required disclosure since 2013, this bill seems to say that even bitcoin just sitting idle in an account need to be disclosed somehow, which is a MAJOR breach of privacy. This is like saying to someone "If you own a nice painting in your house you need to let us know about it" even if it generates no income.
They are basically saying "if you value your privacy you are a criminal, even if you aren't breaking any other laws" which should scare everyone.
One of the great things about bitcoin is it gives libertarianism a business model... and it's right out of SEK3's New Libertarian Manifesto--which was written in the 1970s-- SEK game theorized out what would happen with the Soviet Union, and proved to be correct 20 years later... now we are seeing the exact same game plan here in the USA with bitcoin and this law. But they are too late. Most likely outcome is this will get reversed or widely ignored.... but if they are successful, everyone smart will start leaving the country... or they will create an arab spring like response here, eroding respect for the government and police.
Gay rights couldn't be resisted in the age of the internet when everyone knew their cousin or that guy they went to work with was gay.... will be the same thing with bitcoin.
Question is, just how violent and authoritarian the tyrants in DC want to get.
So, if this is taken to mean ownership or control of cryptocurrency wallet, what does that imply?
What defines ownership? Access? If someone holds a key to a house that doesn't mean they own the house.
What defines control? If a key is destroyed, and no one else owns that key, is is control lost? What if the key is lost? Is control lost until the key is recovered?
Bitcoin was not and never will be anonymous if a user converts to fiat. There is always a way to trace a transaction through the blockchain, and from there to a fiat-Bitcoin exchange where you have an account tied to your bank.
Good, finally some concrete step by senate to stop block craze. Meh typical HN commenters "Taxes are great, except when its us who get taxed". The way I see its time to throw book at bitcoin holders, lets start putting Coinbase execs in prison.
[+] [-] ransom1538|8 years ago|reply
[i] https://www.law.cornell.edu/uscode/text/18/1956 [ii] https://www.irs.gov/newsroom/irs-virtual-currency-guidance [iii] https://www.wsj.com/articles/SB912140808262492000
[+] [-] tehlike|8 years ago|reply
Now, if they ask you your wallets, not declaring could be considered unlawful if this bill passes.
Also technically, wince cryptocoins are commodities, or treated as such, you still need to declare them as a profit on tax forms. They didnt have a way to know so you could decide to not tell. You still can but the boundary gets blurry now - you can expect to be asked more about this during audits etc.
[+] [-] em3rgent0rdr|8 years ago|reply
I don't see anywhere in [ii] where it specifically says that you have to disclose the mere ownership of personally-held bitcoins. That is just saying that you have treat bitcoin just like any other property.
[+] [-] chroem-|8 years ago|reply
[+] [-] tehwebguy|8 years ago|reply
Worst of all she's considered to be basically impossible to replace. It would be very nice to see CA stop giving her money and put a significant challenger forward but it's probably not good ROI to attempt.
[+] [-] rothbardrand|8 years ago|reply
To the downvoters: Seriously it is. For example: Can you imagine what would happen if we allowed people to have bars? People are expected to DRIVE to a BAR and DRINK! Can you imagine what people would do then, if we legalized the existence of bars? People would drive home drunk!
Banning bars is obviously the right thing to do!
[+] [-] 21|8 years ago|reply
To imagine that bitcoin could change that or not abide is foolishness.
* for poor people anyway, with poor meaning < $10 mil which affords you lawyers and offshore shell companies
[+] [-] mirimir|8 years ago|reply
If you use local wallets like Electrum, transact via Tor, mix thoroughly, and generally practice good OPSEC, your personas and their cryptocurrency can be as anonymous as you like. But only as long as you maintain compartmentalization from meatspace.
[+] [-] tehlike|8 years ago|reply
[+] [-] mkempe|8 years ago|reply
[+] [-] HashThis|8 years ago|reply
1) PRIVILEGED CLASSES: Easy cheap to create Off-shore shell company legal entity. Hide ownership of your money. It will auto-shift to a new country if government tries to uncover ownership. Offshore laws make it illegal for bank workers to uncover identity
2) COMMONERS: FinCen dominates over commoners. Every transaction tracked. Prison if you have Bitcoin privacy. They can put you in prison if they claim two transactions were because you were trying to get privacy from government.
[+] [-] multibit|8 years ago|reply
[+] [-] jgh|8 years ago|reply
[+] [-] fghtr|8 years ago|reply
[+] [-] tfha|8 years ago|reply
[+] [-] rothbardrand|8 years ago|reply
And currently, bitcoin is too hard to use for terrorists or most criminals. You have to be relatively sophisticated. Yah, you may have gotten your grandma a wallet, but that's not the same as mastering the level of opsec to fund a clandestine organization using cryptocurrencies...
And further, since every transaction is recorded forever in the blockchain if any future address is compromised, the entire network can be compromised instantaneously....
Bitcoin is really worse for terrorist financing than good old USD.
And we "lost" trillions of USD on Pallets in the Iraq and Afghanistan wars.
[+] [-] CryptoPunk|8 years ago|reply
Also, it reduces the threats posed by governments against their own people. Government repression, like that seen in Venezuela or for a more extreme example, North Korea, can kill far more people than non-state terrorism, and tools that empower individuals help resist that.
[+] [-] mirimir|8 years ago|reply
[+] [-] tanilama|8 years ago|reply
[+] [-] ringaroundthetx|8 years ago|reply
But attempting financial sanctions as a way to deter use? That will be a waste of everyone’s time and money
One idea is if digital currencies get big enough then it will accelerate the insolvency of the state from its obligatory attempts to curb use. Far fetched now, less far fetched than a year ago
[+] [-] DennisP|8 years ago|reply
[+] [-] moduspol|8 years ago|reply
https://news.bitcoin.com/proposed-u-s-legislation-may-crimin...
> A ‘prepaid access device’ means an electronic device or vehicle, such as a card, plate, code, number, electronic serial number, mobile identification number, personal identification number, or other instrument, that provides a portal to funds or the value of funds that have been paid in advance and can be retrievable and transferable at some point in the future.
To me that seems pretty clear they're targeting cryptocurrencies held outside of exchanges.
[+] [-] JoshTriplett|8 years ago|reply
[+] [-] psergeant|8 years ago|reply
[+] [-] em3rgent0rdr|8 years ago|reply
[+] [-] crb002|8 years ago|reply
[+] [-] mooman219|8 years ago|reply
[+] [-] TazeTSchnitzel|8 years ago|reply
[+] [-] JoshTriplett|8 years ago|reply
[+] [-] nlperguiy|8 years ago|reply
[+] [-] CryptoPunk|8 years ago|reply
[+] [-] rothbardrand|8 years ago|reply
[deleted]
[+] [-] grandalf|8 years ago|reply
Income from investments is supposed to be reported to the IRS. It’s silly that anyone would expect crypto currencies to be an exception.
This would be one of the few cases when the title should be updated.
[+] [-] drcode|8 years ago|reply
Bitcoin income has required disclosure since 2013, this bill seems to say that even bitcoin just sitting idle in an account need to be disclosed somehow, which is a MAJOR breach of privacy. This is like saying to someone "If you own a nice painting in your house you need to let us know about it" even if it generates no income.
They are basically saying "if you value your privacy you are a criminal, even if you aren't breaking any other laws" which should scare everyone.
[+] [-] rothbardrand|8 years ago|reply
Gay rights couldn't be resisted in the age of the internet when everyone knew their cousin or that guy they went to work with was gay.... will be the same thing with bitcoin.
Question is, just how violent and authoritarian the tyrants in DC want to get.
[+] [-] tehlike|8 years ago|reply
I agree on the "they are too late" point, but think of it this way: US already knew about your financials. This law doesn't change that.
[+] [-] notaboutdave|8 years ago|reply
[+] [-] nickysielicki|8 years ago|reply
[+] [-] chris_st|8 years ago|reply
[+] [-] unknown|8 years ago|reply
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[+] [-] bobbybreakdanc|8 years ago|reply
What defines ownership? Access? If someone holds a key to a house that doesn't mean they own the house.
What defines control? If a key is destroyed, and no one else owns that key, is is control lost? What if the key is lost? Is control lost until the key is recovered?
[+] [-] Simulacra|8 years ago|reply
[+] [-] estroz|8 years ago|reply
[+] [-] garmaine|8 years ago|reply
[+] [-] tehlike|8 years ago|reply
[+] [-] nickthemagicman|8 years ago|reply
[+] [-] zeep|8 years ago|reply
[+] [-] bitsane|8 years ago|reply