Topic: Anonymity (Read 2495 times)

Good thread (except for the posts from the author of the OP which is myopic socialist illogic).

I discussed many of the points made in this thread in my own thread which also has links to past threads that discussed anonymity.

Coin taint (destruction of fungibility) is a critical flaw in Bitcoin.

CoinJoin and DarkWallets (Darkcoin nor anoncoin) don't solve this problem adequately in my opinion.

Yes - and empowering voiceless communities is what its all about for me also.

Having thought about the tax implications of BTC I don't think anonymous transactions would necessarily have the impact that I initially feared.

Income tax is the largest contributor to the coffers - income tax + VAT +National Insurance are the 3 largest contributors. Of these I can only see income tax as being problematic.
   But it turns out that of income tax raised , 90% is raised via Pay as You Earn (employee contributions). This would be unaffected (for tax raising purposes) wether BTC transactions were anonymous or not.
    Corporation tax would be affected by anon BTC - as would income from self employment. But these taxes are even at the moment a question of pot luck anyway. How much a firms profits and/or an individuals Schedule D income could be manipulated (using anonymity) to reduce tax I don't know - but maybe not as much as I intially thought. [edit:- a progressive consumption tax could be part of the solution here]
       Certainly most other taxes would/should be unaffected   ie. fuel duty + inheritance tax + CGT + local taxes (based on property or income) etc etc.


  Of course - the growing digital economy and its "intangible" products are another matter altogether - and would obviously be problematic with regard taxation.
   I guess if devs in the open source/hacker community aren't receiving remuneration then there's nothing to tax.

But how you gonna put food on the table if you aren't getting paid ?

anonymity breeds culture and vibrancy:

http://chrishateswriting.com/post/76431353368/the-anonymity-i-know

this drive to normalise and purify our activity leads to groupthink and acceptance of imposed limitations.

protecting the small guy is empowering voiceless communities.

for a deeper explanation of the ethos:

https://en.wikipedia.org/wiki/Hacker_ethic#The_hacker_ethics

I take the point about BTC potentially having a huge impact upon Governments monetary policy - and I'm all for this.

The problem I have is the impact BTC will have on Government fiscal policy.

I know some of you want to get rid of Government altogether - I don't personally. Decentralised government and a devolvement of power ? Yes, definitely. But I don't want to get rid of it altogether. What role will there be for Government when BTC transactions are anonymous and raising tax revenue becomes essentially a voluntary act - nay, an act of charity ?

  I happen to believe in the welfare state as outlined in the Beveridge Report http://www.sochealth.co.uk/public-health-and-wellbeing/beveridge-report/ - I also believe that a way out of this recession might be if the Government invested in the nations delapidated and Victorian infrastructure - God knows it needs it. Where would a Government find the money when they can't raise tax ?


ps. re.stolen BTC - ["If I pay for a product in BTC, and the product doesn't get delivered, then the fact that I paid to the correct address can be proven, and proving non-delivery is the same as in non-bitcoin transactions."   -  how will you manage this when the identities involved in the transaction have been anonymised ?]

This is not hard to implement.

If it has not already been mentioned, TIPS (aka Fedora) has just implemented coin mixing to be anonymous. Was launched this week.

Built into the latest TIPS 0.6 wallet.

The usual ways. If I pay for a product in BTC, and the product doesn't get delivered, then the fact that I paid to the correct address can be proven, and proving non-delivery is the same as in non-bitcoin transactions.

Let's imagine that he protocol required every bitcoin address to be registered to a verified real-world name. Completely non-anonymous. Then everyone could tell, from the block-chain, where you spent your money. They'd know which supermarkets you used, whether you frequented pubs and off-licences, how much you spent at the chemist, whether you paid for porn. They could infer a lot more, such as whether you likely had a mistress across town. It would be a massive invasion of privacy.

I doubt a public block-chain would be acceptable to most people if it weren't anonymous.

Taking the gov out of economy, where they should never be.

Cash is useful only for face-to-face transactions. There has to be trust in non-face-to-face transactions.

Banks offer some trust by moderating transactions that use currencies that cash is based on. The banks are benefited in two ways. They get their fees for moderating, and they regulate inflation through the the central banks, the Federal Reserve Bank, and the International Monetary fund. The banks are the thing that has made the world to grow as well as it has in the past. It is the greed of the individual bankers, who have exploited the flaws in the current banking system, that is bringing the fiat currencies down.

Anonymity is for one basic reason, only. It exists to do transacting without the danger of the banks and the governments intervening.

The banks are failing, though it can't be seen easily. The governments are based on the money of the banks that are failing - the governments are failing - and they don't like failure. Bitcoin threatens to bypass such things like income taxes and excise taxes through anonymity.

In the U.S., income taxes can be as high as more than 50% of earnings. Cutting this down to only 10% by having only 10% of the sales visible, is a great advantage for people, and a great detriment for banks and government.

So long as Bitcoin remains decentralised, it can only really apply pressure toward achieving a level playing field.  If it does work against the average citizen, it will be because the average citizen is currently enjoying an unfair advantage over some minority.

If Bitcoin were to significantly affect taxation (a huge if), it would benefit those that currently pay high taxes, and disadvantage those that receive benefits*.

*Taxation is a drag on the economy.  A good case can be made that those who would be immediately disadvantaged by reduced taxation will benefit on net over a sufficiently long period of time.

Fungible coins and paper cash were both great advancements for humanity and economic good for all societies that used them. Many positive correlations in history are well-documented going back hundreds and thousands of years.

There is no reason to expect fungible digital 'coins/cash' would be any different, probably a greater relative advance in respect of it it being a non-physical medium of exchange capable of transferring values anywhere on the planet anonymously.

I think in retrospect it will be come to be seen that the last 20-30 years of traceable digital money substitutes (not fungible) was a historic anomaly bought about by the botched transitioning of legacy paper ledger banking system unsuccessfully into the digital realm. A huge mistake by people who did not understand monetary science all that well but assumed they knew what was best for society (no doubt while feathering their own nests in the process).

Having thought about it we can say that the cat is out of the bag - or rather, its not a case of if BTC anonymity becomes ubiquitous but when.

  I know that Unsystem and the Dark Wallet project have ideological reasons for believing this to be a desirable outcome - and it has been stated on this thread that for BTC to be fungible it has necessarily to be anonymous- but I ask again, is not this anonymity going to work against the average citizen, all things being equal ?

   Governments are struggling enough as it is to raise tax revenue from the likes of Amazon and Google - they won't stand any chance with BTC (once it inevitably is able to be transacted anonymously)

    Say I earn 30BTC per annum - OK, I may wish to give some of that via donations to Wikileaks, maybe even Unsystem.net, and so I may benefit in some way from my financial transactions being hidden (though in my case we'd only be talking about a few satoshi's anyway in truth  )
    And then compare my predicament to (lets say) Richard Branson (who apparently thinks BTC is great) - his annual gross income is what ? 30000BTC ?

  I'm not paying any tax on my 30BTC anyway - but Mr Branson is paying (possibly) 50% on anything over 45BTC on his personal income - and the profits of Virgin PLC are liable to Corporation tax at 30%ish.

   Traditional profit and loss accounts will not be worth the paper they are written on (they aren't worth too much today, lets face it).

   Would it therefore be Schedule E (taxed at source) employee taxation that would bare the brunt (relatively) of the tax burden ?


    I ask again - who will anonymity truly benefit ?  

Of course there is circumstantial evidence, but there has to be enough of it to be of any use.

Btw, I never suggested that cash was less anonymous than Bitcoin, merely captioning what is often overlooked.

Addresses don't belong to people, they are merely associations. Ad-hoc references as it were. I guess my point was that Bitcoin allows you to be as anonymous (to a degree) or obvious as your care allows for.

I'm definitely with hilariousandco on this one; bitcoin is way less anonymous than cash. It doesn't matter that "someone would need to know you have access to the private key" - the fact that there is an unavoidable record made of every transaction is the thing. After that it's correlation of metadata, which is something that investigators of all stripes excel at.

I think that most governments are not as stupid as they look and do know this. It just suits their agenda to keep harping on about anonymous money laundering.

Even with the blockchain somebody would need to know that you have access to the private key for that address, and even then it doesn't prove that it was you who made the transaction.

It's arguable either way. You could even say Bitcoin is more traceable than cash. If I hand cash to someone in the street there's no record, but there's a record of every Blockchain transaction.

Is it?

It's NOT anonymous it's more anonymous than Fiat but still not.

From Unsystem.net :- "We are dedicated to creating popular tools that promote privacy, independence, and integrity in contradistinction to those used for mass surveillance and suppression."

   I understand this - but the other side of the coin is that a public and transparent ledger means that the powers that be suddenly become accountable to us in a way that they haven't been before. Its a two way street this anonymity business. The blockchain isn't just a way by which the masses can have their financial transaction monitored and surveilled. It becomes a means by which the powerful now become accountable for their movements of monetary capital. Its a double edged sword.

This.  For there to be decentralised voting that is fair and free from bribery it needs to be anonymous.  If someone bribes you to vote for someone/a policy and you have no way of proving who or what you voted for (short of them physically standing there and watching you vote) then they can't bribe you.  

This set up, for a true direct digital democracy, of course requires an additional system of ensuring 1 person 1 vote, rather than shareholder voting where votes are allowed proportionally to the investment size of the shareholder, but anonymity is a vital part of it.

Darkcoin looks like it's the leader in this field so far.