The same way they can and will bust your ass for not claiming cash payment's, you can only hide so much money before Owning a million dollar home and making 25k a year flags someone
Topic: Bitcoin Regulation (Read 2100 times)
It's simple once FIAT involved,
The same way they can and will bust your ass for not claiming cash payment's, you can only hide so much money before Owning a million dollar home and making 25k a year flags someone
The same way they can and will bust your ass for not claiming cash payment's, you can only hide so much money before Owning a million dollar home and making 25k a year flags someone
It already falls under existing regulation in most Western countries. Bitcoin is a new system, but the concept of trading something other than fiat currency for something of value is not remotely a new thing. Capital gains, commodities trading, and "barter" rules already exist in tax codes, and money or value transfer rules already exist regarding any system for shifting value around. The legal grey area regards bitcoins themselves - being not currently recognized as currency, bitcoin *itself* is outside the current regulatory framework. I don't see an immediate change in that.
However, as soon as you TRADE Bitcoin, whether for fiat cash or for something else of value, it becomes taxable according to rules that go back hundreds of years and more. Bitcoin is epic and new in the way it executes value transfer and the backbone of the whole system. It's pretty radical because of that - but in terms of regulatory matters, it's not as radical as people think. Enforcement is a separate issue, and the difficulty there remains to be seen - but it is a fact that existing regulation has covered Bitcoin all along, as soon as it is converted into some other form of value with a price tag denominated in fiat cash of any kind.
However, as soon as you TRADE Bitcoin, whether for fiat cash or for something else of value, it becomes taxable according to rules that go back hundreds of years and more. Bitcoin is epic and new in the way it executes value transfer and the backbone of the whole system. It's pretty radical because of that - but in terms of regulatory matters, it's not as radical as people think. Enforcement is a separate issue, and the difficulty there remains to be seen - but it is a fact that existing regulation has covered Bitcoin all along, as soon as it is converted into some other form of value with a price tag denominated in fiat cash of any kind.
It will probably be regulated soon.
Before you trade Bitcoins for Cash you better look into Tax laws in your area.
There is nothing illegal about trading Bitcoins for cash, so long as you report any gains from your trade on your tax return. Just like there is nothing illegal about bartering, the IRS only requires you to report the gain from any trades. That's the way it is in the US anyway, I can't speak to other areas of the world.
As to whether you can get away without reporting or not, I would say that Bitcoin is almost completely off the IRS radar screen unless you are talking about some real money. And by real money I'm talking about Bitcoin millionaires and such.
Bart Chilton who is the commissioner of the CFTC (commodities futures trading commission) is talking about regulating bitcoin. I think he would only be able to regulate derivitave contracts trading though, so it might not be a real issue to those not trading in derivitaves. I don't really know what it would mean for the CFTC to regulate Bitcoin derivitives trading, but frankly I don.'t trust any regulators. In a legal sense it seems to me that and other cryto currencies are more properly thought about as commodities than currencies. This might end up being a distiinction without a difference though.
Personally I think he isn't going to regulate it right away because it would be pretty embarrassing for the CFTC to regulate something that is declared illegal for use as money if other government agencies go that route. Regulation brings legitimacy, so it's a double edged sword.
In reality bitcoin has the potential to compete with USD and that is something the Fed does not want. You can be sure that those in power will not give away any of their power without a fight. This is what concerns me about Bitcoin longer term. They can't make it go away, but they can pass laws making it virtually impossible to deal in Bitcoin. The value comes from it's acceptance as a currency, if it cannot legally be used as currency then owning Bitcoins becomes virtually meaningless.
Personally I think he isn't going to regulate it right away because it would be pretty embarrassing for the CFTC to regulate something that is declared illegal for use as money if other government agencies go that route. Regulation brings legitimacy, so it's a double edged sword.
In reality bitcoin has the potential to compete with USD and that is something the Fed does not want. You can be sure that those in power will not give away any of their power without a fight. This is what concerns me about Bitcoin longer term. They can't make it go away, but they can pass laws making it virtually impossible to deal in Bitcoin. The value comes from it's acceptance as a currency, if it cannot legally be used as currency then owning Bitcoins becomes virtually meaningless.
surely soon will be a hot topic if the bt continues ....
Before you trade Bitcoins for Cash you better look into Tax laws in your area.
yet another noob poster quoting something from a non-intellectual media point, which then out of context and without much information quotes another story, which again is taken out of context.. In england we call this chinese whispers, where after passing information 3 times or more the message gets misinterpreted.
if your going to quote something atleast use the actual full context of the original person that is being quoted, not a third rate blog that grabs half a story from somewhere else. The story if you go into the details and read the whole back story is that bitcoin exchanges ARE ALREADY legally within FINCEN's grasp and accountability, this is because they deal with FIAT. Any exchanges that deal with bitcoin AND fiat that also decide to do commodities will also have to follow the CFTC guidelines as well as the FINCEN guidelines. purely because the FIAT can be linked to the commodities. So CFTC are looking at bitcoin for any 'services' that deal with commodities and fiat, because some of the naive 17yo basement dwellers believe if they have a bitcoin business they are then free to deal with FIAT and commodities purely because its linked in some way to bitcoin.
So the trick yet again. if you want to combine bitcoin and FIAT then look at being legit with the authorities. but if you don't touch FIAT, they cant touch you.
So if you want to accept FIAT in exchange for bitcoin and then offer commodities trading all in one service *cough* http://www.plus500.co.uk/ *cough* you might have to ensure you got all of your licences that government require in order to continue doing business.
i personally love this fact, as it weeds out all of them inexperienced under-age basement dwelling coders from trying to run exchanges, risking our hard earned bitcoins, crying that they have been hacked where in reality they have stolen peoples funds. But instead relies on experienced and well invested people to make services where they cant easily run off at a whim.
for all of you inexperienced guys wanting to make money by creating exchanges, try something smaller, more private, more local. EG exchanges that just swap different alt-coins, that never touch FIAT. Leave the world FIAT trading to people that have experience and money to invest by doing it legally.
if your going to quote something atleast use the actual full context of the original person that is being quoted, not a third rate blog that grabs half a story from somewhere else. The story if you go into the details and read the whole back story is that bitcoin exchanges ARE ALREADY legally within FINCEN's grasp and accountability, this is because they deal with FIAT. Any exchanges that deal with bitcoin AND fiat that also decide to do commodities will also have to follow the CFTC guidelines as well as the FINCEN guidelines. purely because the FIAT can be linked to the commodities. So CFTC are looking at bitcoin for any 'services' that deal with commodities and fiat, because some of the naive 17yo basement dwellers believe if they have a bitcoin business they are then free to deal with FIAT and commodities purely because its linked in some way to bitcoin.
So the trick yet again. if you want to combine bitcoin and FIAT then look at being legit with the authorities. but if you don't touch FIAT, they cant touch you.
So if you want to accept FIAT in exchange for bitcoin and then offer commodities trading all in one service *cough* http://www.plus500.co.uk/ *cough* you might have to ensure you got all of your licences that government require in order to continue doing business.
i personally love this fact, as it weeds out all of them inexperienced under-age basement dwelling coders from trying to run exchanges, risking our hard earned bitcoins, crying that they have been hacked where in reality they have stolen peoples funds. But instead relies on experienced and well invested people to make services where they cant easily run off at a whim.
for all of you inexperienced guys wanting to make money by creating exchanges, try something smaller, more private, more local. EG exchanges that just swap different alt-coins, that never touch FIAT. Leave the world FIAT trading to people that have experience and money to invest by doing it legally.
before regulating it they would have to recognize it as an official currency.
i would welcome the latter and await to see if they can enforce the former.
i would welcome the latter and await to see if they can enforce the former.
I really don't see how Bitcoin can be regulated. It's only a number system used for bartering goods and services. You can assign a number to anything and trade. You would have to banish trade all together to stop Bitcoin a.k.a. MOTB
US is considering regulating bitcoin according to link below. Why are they considering regulating bitcoin? How they plan to regulate bitcoin? What is the purpose of regulating bitcoin? If bitcoin becomes regulated in less than 5 % (US) of the world, how will this affect bitcoin worldwide?
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