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Author Topic: IRS declares Bitcoin as property, not as currency  (Read 8137 times)
Seth King
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« on: March 25, 2014, 04:56:40 PM »

http://www.reddit.com/r/Bitcoin/comments/21c9fe/irs_declares_bitcoin_as_property_not_currency/

This doesn't surprise me at all. I fully expect the state to attack Bitcoin. Unfortunately, many Bitcoiners do not see this as an attack. But that's exactly what this is. This is going to destroy Bitcoin's utility as a currency and keep it as nothing more than a speculative asset, just like gold.

The state will continue to classify and pile on whatever red tape they need to to make Bitcoin as cumbersome, centralized, inefficient, and privacy-killing, as possible. That's fine, I suppose. I expect nothing less from them. What really bothers me is how many Bitcoiners are lining up to lick the boots of the state and jump through all of their hoops.

The state is not what's going to kill Bitcoin. It will be the obedient masses that will do it all for them.

There is very very very little bravery left in "Amercians." I'm afraid the will to disobey, stop paying taxes, and simply ignore all of the state's bullshit, is all but relegated to a minority of anarchists, which are already a small minority of people. So, a minority of a minority.

Feeling pretty down right now.  Cry
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Syock
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« Reply #1 on: March 25, 2014, 08:00:24 PM »

I don't think people in general report real income when they work in a cash industry.  I doubt bitcoin will be any different.   
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Seth King
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« Reply #2 on: March 25, 2014, 09:50:10 PM »

I don't think people in general report real income when they work in a cash industry.  I doubt bitcoin will be any different.   

This isn't about reporting real income. It's about capital gains. Also, this will spell doom for online businesses that do report everything.
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Syock
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« Reply #3 on: March 25, 2014, 10:57:36 PM »

I don't think people in general report real income when they work in a cash industry.  I doubt bitcoin will be any different.  

This isn't about reporting real income. It's about capital gains. Also, this will spell doom for online businesses that do report everything.

Capital gains are only reported when there is a transaction that is reported.   It would be like if they said there is capital gains on cash.  How would they enforce that?  If you don't deal with someone that reports, there is no record of anything.  
« Last Edit: March 26, 2014, 12:50:45 AM by Syock » Logged

Seth King
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« Reply #4 on: March 26, 2014, 01:22:51 AM »

All of the major corporations will report. Furthermore, if a person makes any sizable purchase such as houses or cars, it's a red flag. Sure, there will always be the underground economy, but this is going to make things much more difficult for the white market economy.

Again, I'm not lamenting the state's actions. I fully expect the worse from them. I'm lamenting all of the ditto heads that are happy to obey. That being said, every new bad law usually creates a few more disobedients and anarchists, so...
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« Reply #5 on: March 26, 2014, 05:35:37 AM »

This is bad news.

But from a philosophical standpoint, this news is ONLY as bad as the extent to which people will obey ridiculous laws.   Every anarchist involved with Bitcoin reduces the impact of this just a tiny bit more.

Yes, people and corporations will obey laws and report transactions (which is why it is bad), but if they didn't... this news is meaningless.     I'm hoping that the sheer difficulty and onerousness of even trying to obey this will make just a few people realize that taxation is bullshit.    This may be the first step for some people.

Yeah, I'm dreaming.  Silver lining and all that...

Besides, lets not forget that this bad news for people living in America has no impact to people discovering Bitcoin in other countries.   
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Syock
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« Reply #6 on: March 26, 2014, 12:12:25 PM »

Besides, lets not forget that this bad news for people living in America has no impact to people discovering Bitcoin in other countries.   

This has been an issue for me for some time.  It is my only issue with projects like the FSP.  It isn't the state government that is going to be the issue going forward.  it is the federal government that is the problem.  I suspect we may all be better off going somewhere else.   Even Canada looks quite viable in comparison. 
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Seth King
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« Reply #7 on: March 26, 2014, 03:10:10 PM »

This article pretty much wraps it up:

http://www.theatlantic.com/technology/archive/2014/03/why-bitcoin-can-no-longer-work-as-a-virtual-currency-in-1-paragraph/359648/

I've always believed since day 1 that Bitcoin is going to have a very long, arduous, uphill battle, but that ultimately it will win and possibly destroy the state in the process. It is clear to me that the state and Bitcoin cannot co-exist. We have a choice, freedom or slavery. Freedom will NOT come without disobedience. Period.
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Syock
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« Reply #8 on: March 26, 2014, 04:21:17 PM »

This article pretty much wraps it up:

http://www.theatlantic.com/technology/archive/2014/03/why-bitcoin-can-no-longer-work-as-a-virtual-currency-in-1-paragraph/359648/

I've always believed since day 1 that Bitcoin is going to have a very long, arduous, uphill battle, but that ultimately it will win and possibly destroy the state in the process. It is clear to me that the state and Bitcoin cannot co-exist. We have a choice, freedom or slavery. Freedom will NOT come without disobedience. Period.

I think the complicated nature of the way they want to regulate it will be their own downfall on enforcement.  The average person isn't going to try to determine if they should use LIFO or FIFO to apply to the 0.02 bitcoin that they spent at amazon.  They will just disregard reporting it. 
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Seth King
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« Reply #9 on: March 26, 2014, 05:43:01 PM »

This article pretty much wraps it up:

http://www.theatlantic.com/technology/archive/2014/03/why-bitcoin-can-no-longer-work-as-a-virtual-currency-in-1-paragraph/359648/

I've always believed since day 1 that Bitcoin is going to have a very long, arduous, uphill battle, but that ultimately it will win and possibly destroy the state in the process. It is clear to me that the state and Bitcoin cannot co-exist. We have a choice, freedom or slavery. Freedom will NOT come without disobedience. Period.

I think the complicated nature of the way they want to regulate it will be their own downfall on enforcement.  The average person isn't going to try to determine if they should use LIFO or FIFO to apply to the 0.02 bitcoin that they spent at amazon.  They will just disregard reporting it. 

I hope and suspect you may be right. One of the benefits of the younger, lazy, apathetic generation is their unwillingness to pay attention to what the rules are and follow them. Like Bittorrents.
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MAM
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« Reply #10 on: March 26, 2014, 06:38:58 PM »

I wonder if the Struggle will ever end...

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"A stone is heavy and the sand is weighty but a fool's wrath is heavier than them both"-Tuek

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Deciding on Lunch."-Davi Barker
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« Reply #11 on: March 26, 2014, 07:39:32 PM »

This won't kill bitcoin, but it could severely retard its utility (and therefore acceptance) in the United States.   But maybe Bitcoin was never going to succeed in the US anyway.   Maybe Bitcoin was never intended for the US.   The people who have the most to gain from cryptocurrencies aren't in first-world countries like the US.     I firmly believe that the countries who stand against this innovation by banning or slapping ridiculous regulations on it will regret it deeply... and soon.   Within our lifetimes kind of soon.   Within the decade kind of soon.   We'll be around to see the wailing and gnashing of teeth when some Asian or South American country becomes the new dawning economic superpower while the bitcoin infrastructure here in the US struggles for a foothold amid a tangle of regulation and taxation.    Good.   We will have the future we deserve, brought to us by the government that we tolerate.   

Meanwhile, I'm going to pursue what I consider the only proper course for an anarchist/agorist:  I'm going to ignore this.    What little Bitcoin business I do will continue with minimal (if any) changes.      I for damned sure won't be calculating capital gains on every goddamn transaction.  Oh, wow, I guess I'm an activist now!

   
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Seth King
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« Reply #12 on: March 26, 2014, 08:38:58 PM »

This won't kill bitcoin, but it could severely retard its utility (and therefore acceptance) in the United States.   But maybe Bitcoin was never going to succeed in the US anyway.   Maybe Bitcoin was never intended for the US.   The people who have the most to gain from cryptocurrencies aren't in first-world countries like the US.     I firmly believe that the countries who stand against this innovation by banning or slapping ridiculous regulations on it will regret it deeply... and soon.   Within our lifetimes kind of soon.   Within the decade kind of soon.   We'll be around to see the wailing and gnashing of teeth when some Asian or South American country becomes the new dawning economic superpower while the bitcoin infrastructure here in the US struggles for a foothold amid a tangle of regulation and taxation.    Good.   We will have the future we deserve, brought to us by the government that we tolerate.   

Meanwhile, I'm going to pursue what I consider the only proper course for an anarchist/agorist:  I'm going to ignore this.    What little Bitcoin business I do will continue with minimal (if any) changes.      I for damned sure won't be calculating capital gains on every goddamn transaction.  Oh, wow, I guess I'm an activist now!

   


Now if only I could get you to move to New Hampshire.  Wink
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