Topic: Goodbye, privacy, goodbye, it was nice while it lasted. - page 3. (Read 2250 times)

Localbitcoins was a perfectly fine site that worked for in-person cash trades until the regulatory climate forced LBC to kill off that feature (they could have moved to a different jurisdiction but that wouldn't be enough in the long term).

This is a very interesting analogy, but perhaps it gives some hope rather than just a bleak picture of the future. Once poker started getting clamped down on, then your options (correct me if I'm wrong) seemed to be either suck it up and accept the overly aggressive authorities, or stop playing, with many players choosing the latter. The same is not true of bitcoin. With centralized exchanges and other centralized services are being clamped down on, the alternative option remains to trade peer to peer, hold your own coins, spend bitcoin directly with merchants, and avoid centralized exchanges. In fact, the more people who do this, then the more bitcoin functions more like what it was designed to be - a peer to peer currency free from third party control.

Yes, I abhor the crazy privacy invasion and mass surveillance that is steadily progressing through this space, but the more authoritarian they become then (hopefully) the more people start using bitcoin as bitcoin was intended to be used.

Absolutely agree, and services know this too. Let people sign up with a non-KYC account or minimal-KYC account and access some basic functions. Then, once they have started to use your service, confiscate their coins and hit them with more KYC demands. Options are then to give up your information or give up your coins. Most will choose the former. It's a particularly scummy and borderline criminal behavior that all the big exchanges do regularly, and it never fails to surprise me that people will continue to use services which pull this crap on them.

True, especially in the past several years there's often even more friction compared with the legacy highly-regulated financial system. But these type of sites tend to be at the top when googling 'buy bitcoin' in English and in other languages. And they often started as less restrictive; many users will (sometimes happily, sometimes grudgingly) provide whatever is asked of them to continue using a given service. The requirements are also lower for people who try to buy/sell small amounts, so there's sunk cost to be taken into account, especially with services happy to accept money before freezing them and requiring verification.

i know that people are concerned about privacy .. by this i mean the privacy people had pre 1960's (before debit/credit cards were invented) where cash was treated as private.

i know people are concerned that in a "cashless" society of electronic currency that everything can be tracked. well this is true. everything is tracked and logged somewhere.

but lets not go tin foil hat with silly propaganda that there are millions of government employees watching all these movements.
yes your trades and deposits/withdrawals are logged by service providers. and yes out of all of these logged items 1% of them get forwarded on to government systems. and out of those 1%.. 0.99% (99% of the 1%) are just logged on government systems but not seen by human eyes of government employee's.

im not saying dont care about privacy. im saying dont exaggerate what actually happens to your data by thinking that doing $1k will get you punished/visited at home by swat teams.

i personally have moved alot of money way beyond $1k values, and i do not get knocks at the door from government agents.

i am not worried about the fake news propaganda that bitcoin-core will need to KYC all its users, because i actually read the US/EU law proposals and none of them actually even hint at that requirement

if we are to have a rational debate about privacy and its implications, we must start with the reality of the situation.
for instance if its not about wanting to remain private because your a criminal, but instead you dont want to have to pay taxes on your funds. there are actual tax avoidance methods(emphasis legally allowed avoidance not criminal evasion)
just look at the UK/US government politicians.(google them) they are happily giving themselves 'loans' to receive income without paying tax.
we can develop ways to instead of 'exchanging' crypto for fiat(legally defined as investment/income), we can set up 'loan services' where its listed in terms and conditions that we(as a service users username) are 'loaning' to our individual self, fiat/crypto at 0% interest with lots of non-conditions of repayment. EG 99 year repayment schedule with a $0.001 penalty for non re-payment in 99 years, which can be written off if loan recipient is deceased

if it is about not wanting to be seen because you are worried you could be seen as a criminal due to your activities. well we can try to have a rational debate about what services to avoid to ensure you are not spotted. EG many people dont realise that using mixers will actually get you spotted more by a service than you would if you just done a normal deposit into a service without the mixer... using known tor exit nodes, known VPN/proxy services will raise red flags too

so how about get more clever, such as setting up services where we loan our online pseudonym fiat to deposit into services which by terms of the service become tax exempt legally thus no need to report. and the same where online pseudonym 'loans' your human self on withdrawal.

basically re-define an exchange as something legally outside the remit of tax reporting, so that exchanges have less bureacracy.

also highlighting if you dont currently want fiat right now, simply dont use fiat based services

I think that when it comes to money and somehow they want to tell you through regulations and No privacy so that you have less money, people simply become irreverent, because normally both the rulers and the banks have their money and it is a lot that they have, then they are not interested in people in their particular economies having money or being able to achieve financial freedom in an economy totally different from the traditional one, this is what we commonly call the advantage of the deflationary economy over the inflationary one, where the traditional and inflationary economy, the accounts know who it is, and they have all their data, while with Crypto if the person wants to maintain their anonymity, they will keep it that way so that no one messes with them, this is logical.

another reason that crypto is becoming regulated by the financial agencies of government. is because instead of being treated as a product(like facebook credits) its being treated like a currency. thus regulated by currency agencies.

if bitcoin did not get classed as a currency. trading it would be classed as buying a product. but because its treated as a currency. trading it is an investment/money service business.

exchanges in 2010-2014 got away with not being regulated simply because crypto was not legally classed as a currency. so currency rules didnt apply. exchanges worked as retailers offering a product sale/refund to-from fiat
but now countries recognise crypto as a currency and so currency rules apply when swapping for fiat

I see very interesting opinions in the thread, and rather than commenting on some of the aspects that you have mentioned, I wanted to share my personal experience with something that I see a parallel with and that has been going through my head a lot lately.

If I remember correctly I started playing poker online in 2009. At that time poker houses, and I understand that online gambling houses in general, either had a license to operate from a tax haven or operated without a license. No one sees a parallel with crypto gambling houses today?

If someone asked about taxation of poker profits in a poker forum, everyone said that there was a legal obligation to declare, and that they declared everything they earned, even though it was practically impossible for the states to know anything about their earnings unless the deposits and withdrawals were made by international transfer, which would take a long time and would probably be blocked by the bank because they were transfers to and from tax havens.

We were in the midst of the crisis that began in 2007/08 and until then the states had not paid much attention to online gambling, because before the bubble burst, the economy was doing very well (or rather we can say, it was super-inflated).

When the bubble burst, states started looking for money everywhere and one of the things that were targeted were online gambling houses.

Long story short, the result was quite disastrous. In part I understand that it is logical that the states ended up regulating the game and charging taxes for it, the problem is that in some cases they did it in the worst possible way, compartmentalizing a market that was once global.

We could say is good that today the states charge taxes for online gambling, which is logical, the bad part was killing the goose that lays the golden eggs: there are fewer and fewer players, houses give less and less rakeback, the tables are getting harder and harder. This has been an inexorable trend with the exception of 2020 when lockdowns made a lot of people decide playing online poker while having a few beers.

I suppose that it is partly because I have lived through this experience that I am pessimistic regading the possible EU crypto payments regulation, although something similar does not have to be repeated, but it makes me think that in the end legislation will be implemented that will allow the states to continue collecting taxes and will greatly attack privacy, and it is not that the states of the EU are characterized precisely by having a great libertarian movement that can oppose this type of regulations.

certain people in this topic are trying desparetly to set up a narrative that people should avoid using services like bitpay and should instead pay a retailer direct. while also setting up that moving large amounts is a bad thing and people should use small amounts. and also people should use decentralised networks and decentralised mixers.. in short they are trying to find as many excuses for people to be prompted to lock up bitcoin and go play around with other networks of less security but the FAKE promises of privacy

what they do not realise is that their altnet they favour most is actually going to get even more regulated per user, than bitcoin is individually at its bitcoin core level.

yep they have made very many fake suggestions that bitcoin core is affected by new regulations while downplaying/ignoring/avoiding how their altnet nodes are going to get regulated.

here is what they should know
altnets that promote 'dex' might appear to be private and pretend to offer decentralised exchanging for fiat. or even unrecorded methods to 'route' a payment.. but, here is their problem

routing is a service for a fee.. yep if your allowing yourself to do 'routing' via associating a certain amount of balance of your altnet value to be used to 'autopilot' routes where you announce your channel as a possible route and a fee.. you are becoming a service provider.
however bitcoin core does not annouce itself as a service for a fee so bitcoin core is not under the new laws of "service provider"

also even if you can hide you identity when doing decentralised fiat exchanges on altnets.. your bank can clearly see you doing lots of random wire transfers to lots of random people. and under terms of most personal bank accounts , this is a big no-no, because its seen as you either doing money laundering for doing all these swaps of fiat between people, or seen as running a unregistered money service business.

yep it does not matter if your trading casino tokens, pokemon cards, or crypto, if your taking in many wire transfers from one bunch of people and sending out wire transfers to another bunch of people . your bank, without even knowing or caring about the platform/network/token you might be playing with. will just see the fiat movements and slap you with demands

yep using an altnet wont hide your wire transfers. so pretend that using an altnet to hide the crypto stuff also hides the fiat stuff.. it does not.

many people have tried to say 'localbitcoin' failed because 'bitcoin is centralised' when the reality is that the sellers on localbitcoins were independent and decentralised in regards to the bitcoin side..  but their bank accounts were flagged as running a possible illicit/unregistered business/service simply because of the amount of wire transfers being processed. its not localbitcoins fault. its the banking fault of personal account terms and conditions.

so if you want to use an altnet to do fiat swaps/routing for anything. you will have to register as a money service provider and have a business account and become regulated and file taxes on your income and outgoings.
yep the very feature of a certain network only works by publicly announcing your channel as a route.. for people to the route .. thus you cannot hide
(well you could in its early iterations, and could if you tweak your node to plan routes outside the new bolt method, but certain devs of that altnet prefer the public listing bolt version now, so goodluck with that fake 'privacy' statement now)

oh and having the altnet offering payment services via things like 'shopify' will make people need to give info because shopify is a service provider like bitpay. meaning the altnet is actually not trying to find ways to avoid bitcoins bitpay problem, instead they are just making false statement that their altnet is better than bitcoins network. .. (facepalm)

Another somewhat random thought is that yes it all comes down to tax revenue in the end as @AicecreaME said. At least here in the US and wherever they are.

As of now PayPal and Venmo the like in the US for the 2022 tax year now have to issue tax documents when you take in more then $600. It used to be $20,000 and 200 transactions.

There have been people screaming all over they will now have to pay income tax and collect sales on their sales.

Uhhhh, that's the law. Just because you have been running your organic honey and craft beer side business out of your garage and an occasionally a farmers market that does not mean you were not supposed to be paying income and collecting sales tax on your sales.

Sorry but as someone who reports everything and probably more then I should it's not my job to support you because you didn't want to report stuff to the government. Be it for privacy or you just didn't want to pay. Part of what the governments are doing and dragging the payment processors along with them is making sure they get their cut. We can argue about taxes all we want, but for the here and now it's the law of the land.

-Dave

It's really unfortunate that people are slowly being forced into centralization despite bitcoin being decentralized in nature. It's true that the government seeks control in almost every way possible, hence, the central organizations and other financial or exchanger platform under the jurisdiction of the government is mandated to have KYC on their clients. This is their way to regulate if they can't manipulate crypto itself.

Here in our country, you really have to use a centralized exchanger in order to spend or withdraw your bitcoin and other coins. This comes with tax in order for them to profit, of course, and anonymity is already compromised. But this is the sad reality. Sooner or later, verification of identity would be required and not just optional which will defeat the purpose of bitcoin. There may be ways, but hopefully in the future it won't be limited.

A lot, he can rant a lot. :-)

Bit of a ramble, but I also think it comes back a bit to philosophy.
I tend to use the "fight the fights you can win" theory when it comes to crypto and IMO  @o_e_l_e_o tends towards the "fight the fights that need fighting"

I don't like BitPay or any of the other intrusive services. But if I can talk a merchant into taking BTC and they don't want to do it themselves there is a limit to what is out there that does not totally rake you over the coals in terms of rates.

So in the end if it's BitPay / Coinbase Commecre / CashApp-Square / or nothing I'll choose to send them to one of those evil KYC places because *I* see it as a win that another merchant takes BTC.

Others that fight the fights that need fighting will see it as a loss since privacy just got slammed.
We need both types of people IMO.

2 side comments about BitPay.
1) They are now starting to take lightning payments
2) Unless you are doing that 1 large purchase that puts you over their somewhat arbitrary limit, they track by email for total spent. Disposable emails do help that issue a bit.

-Dave

Yes, I'm aware that unfortunately Wasabi have sold out. I've told them exactly what I think about their behavior already: https://bitcointalksearch.org/topic/m.59741761

Absolutely. Don't even get me started on the clusterfuck that is BitPay. DaveF will tell you how long I can rant about them. This is why the best solution is for merchants to use their own self hosted processor such as BTCPay.

Depends on how you define "friction". I would say requiring me to give them my name, address, phone number, employment status, information on where my money is coming from and where it is going, copies of my passport and driver's license, selfies, and copies of my latest colonoscopy, to then have to give up custody of my money and still risk being locked out my account and waiting months for support to get back to me to be far more friction than simply finding a well rated user and trading with them directly peer to peer.

https://twitter.com/wasabiwallet/status/1503091503207432193

Cryptocurrency payment processors are also sometimes asking for KYC, if they aren't, they can be eventually compelled to do so. Even P2P trading and decentralized exchanges can be attacked, e.g. Etherdelta's founder was probably the first case of a dex founder getting fined and the appetite has grown since then.

https://www.wsj.com/articles/cryptos-defi-projects-arent-immune-to-regulation-secs-gensler-says-11629365401


Coinbase, Binance and similar sites are so popular and will remain so because they allow users to buy/sell with less friction than the alternatives.

At that point, bitcoin becomes worse than cash. Bitcoin is great exactly because it is censorship resistant, it can be as private as you want it to be, and it cannot be controlled by third parties. If you are prevented from spending your coins without doxxing yourself to a third party, then bitcoin has failed to be private, be censorship resistant, or to be free from third party control. There have also been attempts (thankfully, all failed) to censor transactions at the mining level by (so far a tiny minority of) miners collaborating with blockchain analysis entities and refusing to mine certain transactions. As I've said before, if I can't spend my bitcoin without completing KYC or without some third party giving me "approval", then for me, bitcoin will have failed. At that point, it is worse than cash, which although based on the terrible fiat system can at least still be spent privately and without third party control.

I don't think it is too late by any means. There is constant progress being made in terms of peer to peer trading, decentralized exchanges, mixers, privacy wallets and techniques, and so forth. Even without any of these things, if people just stopped throwing their personal information out like confetti then much of this damage could be stopped or even reversed. The problem is all the newbies coming to this space are told by people who have never traded P2P to go sign up with Coinbase or Binance because P2P trading is too "complicated" or they are "more likely to be scammed".

Unfortunately the global trends are leaning towards less financial freedom, it'll probably be the same in most of the world sooner or later. The EU being a huge market having an influence on other markets doesn't help here either.


Today those that aren't using exchanges or other places requiring the surrendering of privacy are a small shrinking minority, meaning there's less incentive for businesses to cater to them. With increasingly onerous regulations it'll be harder and harder to buy non-DNM related goods and services without self-doxing. At that point for most uses BTC will be no different than electronic fiat money, yes it can't be debased (although global macroeconomics in practice affects its price, too), and it can't be as easily frozen/confiscated, but if you know the HODLer's identity, you can often put pressure on them (from the authorities' point of view), but there will be less freedom to buy/sell/spend compared with cash or commodities such as gold or silver.

https://www.metzdowd.com/pipermail/cryptography/2008-November/014823.html

emphasis mine

Even Satoshi didn't have too high a level of expectations, in that regard Bitcoin has been a massive success. The unknown person who replied to Satoshi with "You will not find a solution to political problems in cryptography." was partly right, I think. Unfortunately, we the wide Bitcoin community have failed to adequately react in time, especially those of us who have been around for longer. (Whether it would have made enough difference is another matter...)

Pretty much this. There have been some that have been able to skirt round the edges of regulation, and some users who have been able to use accounts without completing KYC, but even then your privacy is poor at best. Laws like the one being discussed here will put an end to all that, though. It's full privacy invasion or nothing now.

The best time to stop using centralized exchanges was 10 years ago. The second best time is now.

I can only speak for myself, but I have never once wanted more regulations, more laws, more authority involvement, etc., for bitcoin. I despite the mentality of "regulations are good because it means we are being accepted" and other such nonsense. As DooMAD eloquently put it, getting away from centralized control is kind of the whole point of what we are doing here.

Well, Bitcoin allows to send a (single) transfer to a wallet from several unhosted wallets  

But of course I don't really believe they meant that (I doubt one of the EU parlamentarians knows about SIGHASH and the like, maybe Patrick Breyer or these three MPs). I generally agree with you here, but I have hopes the final document will be a bit more precise.

In the last weeks I stumbled upon several businesses I would never thought of that they would receive bitcoin but they do now - mainly a medium-sized (registered) car selling business and a big holiday complex.

Food however may be difficult, as the amounts spent are generally so small amounts that if some supermarket bothers about accepting BTC it will almost certainly use a payment processor which would then require KYC.

Generally, a popular P2P ecommerce platform like OpenBazaar would help a lot with most of these things, as it would show supply and demand more directly than if you have to search each business in the web. I really hope it gets traction again, although for now they're going through difficult times and are barely used.

Withdrawing taxes on cryptocurrency users will certainly increase the income for the country. it only takes time, Bitcoin or cryptocurrency becomes an important part and becomes the future transaction technology. The regulations given by the government will not be complete.
A lot of positive support has come that makes transactions in cryptocurrencies even better, as you said about the Bitcoin Mixer Coinjoin transaction which is willing to open its user data for those who are indicated as money laundering. But this will remain private.

They say:
http://www.pbc.gov.cn/goutongjiaoliu/113456/113469/4348556/index.html
It's about time we get over it, China banned first ICOs, then exchanges, then mining, then financial transactions, then domestic use, there is nothing left that can be banned anymore.


Exactly my point, people will always think of balances, and you can see pretty well all around you that those willing to make sacrifices for ideals can be counted pretty easily using one hand. Yeah, privacy is nice, yeah it's nice to have freedom, but wait till you reach the stomach area. 
Why is 90% of this world going to a shithole if not because of people thinking short-term and about their won issues first?


Of course not, if everyone would be a real libertarian we wouldn't be in this mess right now, we wouldn't have a ton of centralized exchanges, we wouldn't have all these hype projects with no meaning but at the same time we wouldn't have any talks about regulations at all or any desire to do so. And I doubt even the conservatism move has more followers, if I would have to nominate the biggest party around now it would be "My wallet to Moon" faction.

You can't compare countries of different regimes and expect to make a proper conclusion. If the pigs administrate their economy, last thing they'd want is uncontrollable, censorship-resistant money. Also, who says it's banned? All I know is that they've forbidden mining.

Perhaps because there are hundreds of other reasons one won't leave their country?

I wouldn't say all those who use Bitcoin are libertarians with emphasized ideals etc. Most are probably conservatists who just want to make a few bucks and pretend to support this libertarian movement. However, the hypocrisy, if you want, of the latter does favor the former.