We're moving towards having 2 parallel Bitcoin ecosystems - one with tight regulations, where the government will always know how many coins you own and were you send them, just like with your banks, and the one were you will be only able to do p2p transactions or use unregulated services, like crypto casinos. I think this is better than the alternative of having Bitcoin banned, because compared to that, people will have an option to legally buy/sell/spend their coins, without any fear.
Point 1
But will it really be this bad? I mean say I have to show a BTC registered address...to my Crypto Exchange in the United States. Big whoop, I make a wallet address
and anything in or out on coinbase will be through this new ...easy ...peasy ...empty say paper wallet. So I sell BTC that I xfered to that wallet (legal) on Coinbase...and
it is more than 10K ...a form pops up on coinbase stating ..probably ...per usual..that this is MY self-hosted wallet and that is done...IF I buy from coinbase...the
Know Your Customer for that direction already works.
Point 2
I simply 'skip' the United States exchange on expanded KYC and simply go with KYC through say an exchange in Canada which does not have this extra step..again..
buying or selling as long as I do my cap gains and stuff for the IRS in the USA..I should be golden tax wise anyway
Point 3
People can still send you money directly say to any self-hosted (say paper wallet) you own....from say overseas mining profits more than $350 or whatever...
if it is a legit mining operation that allows me to be paid in crpto from overseas..it should have a business address and be legit. IF not....well then the process
is un-do-able for person to person stuff overseas and it will be rapidly ignored. On the other hand ...you keep track of such anyway from your end saying i got
such and such product from alibaba for a used miner and alibaba info ....as long as you report such it should be fine..if not...well ...than that means that the
USA wants to stop ALL person to person private wallet overseas to your private wallet overseas to you in USA over $350 without you getting KYC from everyone
well it won't stand IMHO.
What is 'likely' to stand in USA and elsewhere is the over $10k recieved or sent through an exchange ..the point you convert such crypto back to cash...or exchanges
once it gets to joe's coffee clutch buying a expresso machine from china and they require you know your KYC of whomever there..well then it is just
unworkable.
Or am I missing the boat on all this and they really, really do require or want to require ALL transactions overseas over $350 to KYC the vendor at the other end and/or
the same with me sending like for gold in the USA from private paper wallet to some other guy's paper wallet of over $10k etc, etc.
I can see this from the exchange point of view of in/out back forth as exists now and KYC into cash or out of cash via exchanges or banks etc.
But under the system they may want above....PayPal does not 'check' everyone I can send cash to on PayPal..they only respond if i get ripped off...
so this would not work under PayPal or bitpay if it as I state above..so again, UN-doable..like the 2014 IRS rule of if I made BTC for 99c as a BTC founder
and bought a TV with it 8 years later for $500 I owe $499.01 in capital gains and have to keep track of each ...did not happen then....so hopefully
the Biden Administration may require stuff on a USA crypto exchange to go through your registered say BTC address and you fill lout a form that says..
'to the best of my knowledge' like for a wire xfer this is a legit bit of commerce we are doing...beyond that ...just won't work in any real manner. Again,
think it will be tweaked a lot of Republican Legislators in the USA already sent a couple letters to the regulators proposing such controls on all self-hosted
wallets as stupid and undo-able..also so frigging fuzzy and vague high likelihood a court would toss such without modification.
Then again, am I missing something really obvious they can get a regular person using USA exchanges or sending BTC or getting BTC out and about from
around the world either in sending/buying or mining such etc?
Maybe I'm just naive and they can simply put all the legalities on the individual with the wallet and make the whole process grind to a halt for crypto in
the USA. Please comment. But the above is 1) exchange as stated on above likely to say 2) overseas being harder than just a wire xfer info likely not.
Brad