For example, Bitcoin enthusiasts seem to suggest that its
anonymity is an advantage. But, first, it is really not anonymous.
Second, even if it were, so is cash. And third, if I am making a
legitimate purchase, why does it need to be anonymous anyway?
Something just feels underhanded about that.
anonymity is an advantage. But, first, it is really not anonymous.
Second, even if it were, so is cash. And third, if I am making a
legitimate purchase, why does it need to be anonymous anyway?
Something just feels underhanded about that.
Correct Bitcoin is not anonymous. This has been shown in research papers.
Cash is being phased out by the bankrupt socialism that is going to tax+confiscate itself into the abyss.
And my concern is that while
Bitcoin has been an interesting and, yes, even somewhat
successful experiment thus far, its ultimate, inevitable failure might
set back crypto-currencies several years.
Bitcoin has been an interesting and, yes, even somewhat
successful experiment thus far, its ultimate, inevitable failure might
set back crypto-currencies several years.
Quote
And so there has been a big question mark, not just about
how you characterize virtual currencies for tax purposes but also
about when you have a taxable event in different kinds of
transactions. But we may be getting answers soon. In May 2013,
the General Accounting Office asked the IRS to provide some
guidance on the tax treatment of virtual currencies. It was reported
about six weeks ago that an IRS ruling should be out soon.
how you characterize virtual currencies for tax purposes but also
about when you have a taxable event in different kinds of
transactions. But we may be getting answers soon. In May 2013,
the General Accounting Office asked the IRS to provide some
guidance on the tax treatment of virtual currencies. It was reported
about six weeks ago that an IRS ruling should be out soon.
Wow! If the IRS rules each transaction must be logged for capital gains and/or income tax, then that could send Bitcoin tumbling in price because legal tender doesn't have that requirement.
This would cause many to note the masses won't want to do that bookkeeping just to buy a hamburger.
Quote
Dax Hansen: Over the last few weeks, the international responses
have become more unfriendly to virtual currencies. But most
international jurisdictions have generally taken a very hands-off
approach to bitcoin. For instance, in the EU, bitcoin transactions are
generally not regulated. You do not have to have the equivalent of
a money transfer license and you do not even have to have an anti-
money--laundering policy. So my view is that US regulations are
more intense and complicated to navigate than those that exist
internationally, especially given the state patchwork governing
virtual currencies in the US. It is just too hard to set up a
technology company focused on bitcoin here in the United States,
and it is easier to do it someplace overseas.
have become more unfriendly to virtual currencies. But most
international jurisdictions have generally taken a very hands-off
approach to bitcoin. For instance, in the EU, bitcoin transactions are
generally not regulated. You do not have to have the equivalent of
a money transfer license and you do not even have to have an anti-
money--laundering policy. So my view is that US regulations are
more intense and complicated to navigate than those that exist
internationally, especially given the state patchwork governing
virtual currencies in the US. It is just too hard to set up a
technology company focused on bitcoin here in the United States,
and it is easier to do it someplace overseas.
I believe European Bitcoiners are being fooled if they think that as the European economies collapse in the debt collapse, that the G20 is not going to cooperate to stop capital flight via Bitcoin.
The G20 has already announced it will cooperate with the NSA to track down all capital flight.
The EU is giving European Bitcoiners a long leash to hang themselves with.
The regulation will come because it must, otherwise Europeans can escape the coming tax+confiscations by running to Bitcoin.
See the reason anonymity will be so important?
Quote
Currently, retailers pay a percentage of purchase volume called the
merchant discount rate (MDR) in order to accept electronic forms
of payments. In the United States, the average MDR is about 2.5%
for offline retail payments and 3.0% for online retail payments
(though these fees vary widely by merchant size and type). Today,
the use of virtual currencies could theoretically eliminate these
fees as they do not rely on traditional banking/payment networks.
That said, Bitcoin gateway service providers such as BitPay and
Coinbase, which enable merchants to accept Bitcoin payments,
typically charge a fee of about 1%.
merchant discount rate (MDR) in order to accept electronic forms
of payments. In the United States, the average MDR is about 2.5%
for offline retail payments and 3.0% for online retail payments
(though these fees vary widely by merchant size and type). Today,
the use of virtual currencies could theoretically eliminate these
fees as they do not rely on traditional banking/payment networks.
That said, Bitcoin gateway service providers such as BitPay and
Coinbase, which enable merchants to accept Bitcoin payments,
typically charge a fee of about 1%.
I was a download software merchant in the past. I don't know if it has improved but in addition to the 3.5% MDR, I also paid 0.5% to the payment processor, and I had another couple of percent loses to chargebacks.
So the actual cost to most small internet merchants is 5+%.
That is significant. But again the consumers don't care.
Now if you can offer a significant discount for using Bitcoin, i.e. if the lack of chargebacks significantly lowers your cost of doing business, then consumers would care!
