But do you know if you today Government and World Bank passes judgement or gives order that Bitcoin is now generally acceptable as payment in all various country, use as fiat including in day life expenses, individuals has no options than to use, now taking of transactions fees it is only less than $1 and max of $2.5 depending on the gas fee at such point. As time goes we could be used to it.,
The honest truth of it is the "Volatility".
I believe that the laws are fine, the gas fee situation will be fixed in the future for sure without a doubt. Look at Lightning Network on bitcoin right now, it spends only a few satoshis and it is incredibly fast as well.
It is not ideal right now because of security concerns and that is why we are not seeing that everywhere, but it is being worked on right now which means that when the time comes we are going to have a system where it's only like 1-5 cents per transaction and that would be amazing and it could be working towards paying right away anywhere you go as well since you wouldn't have to wait neither, it is both fast and cheap.
The laws are fine? I would rather say that laws are clearly insufficient in most cases or not very favorable regarding crypto to say the least. Actually, from where we are now I expect laws to get even worse over time, much stricter and kind of hindering worldwide adoption in some areas. Bitcoin's utility is massively suppressed by most tax laws around the world for example. If spending Bitcoin on little things even triggers taxable events, using Bitcoin would end in a total mess for most users.
They should rather foster utility with new laws while offering Bitcoin users a fair deal in terms of transparency and taxation, but that is not what lawmakers are after.
This is the most interesting thing about Bitcoin. It is beyond the current system of 'international law' to control. All it is is a currency, & this is a system that declares the world as capitalist, themselves as liberal. So, a currency made of open-source technology based on the internet, what nation has a right to tax that? Sure, different nations can try banning it or regulating mining or taxing profits made from Bitcoin via exchanges or transactions under their jurisdiction, but what other than cronyism & pessimism & greed could be their motive? What ethical basis can there possibly be for criminalizing or legislating BTC? You can see how desperate & unscrupulous they are when they start blaming it for global warming =/
Fact is, nobody has a right to police the internet. It is in international waters, so to speak. And internet currency has made everyone take this more seriously than ever, so that workable international law & the international constitution necessary to base it on are appearing on the horizon like never before. Some people dream of this signalling a totalitarian new world order, because of their subjective experiences with national governments & regimes of the past. But I have faith in the people. As cannabis returns to the white market for global trade & Bitcoin is increasingly established as a worldwide medium of exchange, poverty everywhere is going to decrease.
As much as I would like to let you know that I fully agree, the issue with what you just said is that it is unrealistic for Bitcoin to develop into its own economic system without any tax burdens whatsoever. I would rather say that whatever generates income is taxable (under most circumstances). If Bitcoin makes you income, a tax applies. I don't think a world would work out properly without taxes. There was an interesting sentence a while ago about the rich saying they are fine with higher taxes and carry a heavier burden than the poor. Then it was added that the state donation account was just in the thousands. If the millionaires and billionaires are fine with higher taxes, why not just send money to that state controlled donation account? In a sense it is the same when I am fine with higher tax, I can either pay higher tax or impose a tax on myself through donations that I commit to. Yet that account is usually literally empty. People aren't going to support public goods the way we wish they were. Economic self-interest isn't bad per se, but it needs moderation and coordination. Tax is a tool to achieve that. I am not saying I am all for taxes in whatever form they occur, but I don't see how an economic system would support a social system without taxation requirements.
Sure they can tax associated income as you say in the form of capital gains or whatever, but my broad point still stands. Bitcoin itself as a standalone thing, unlike any other currency, cannot be claimed & thus taxed by a state agency. It relies on the internet & belongs to the users. Think about a state agency claiming jurisdiction over the internet & trying to tax Bitcoin like they do national currencies, I think that is unrealistic.
I totally get what you are saying and I am not arguing against your point from a theoretical perspective. The reality, however, will turn out to be quite different. Before the governments forego any significant tax income, they would rather build cross boarder alliances in order to set up a tax regime that ensures nobody can get away with amassing wealth while not paying any tax.
Please elaborate further once more for me: so you say that when I buy Bitcoin at 10,000 a piece, and I use that Bitcoin to buy a car for 20,000 a piece, should I, according to your viewpoint, be taxed by my government or not? Could you give one or two examples when you think a tax should apply and when not?
Simply put, if two traders anywhere on earth decide to buy/sell a car in Bitcoin, then they cannot be taxed. The caveat I am trying to add is that once people establish a business based in one or another national jurisdiction doing this then they can be taxed. Also, once people trade their Bitcoin in for any national currency the state agency responsible may impose income or capital gains tax on that. But as long as Bitcoin remains Bitcoin & in the hands of private individuals it cannot & should not be taxed. From my understanding the logic of taxation is that in partaking of a national economy & its exchange medium or currency you are using a service & there is an implied cost. The amount & kind of taxation that is acceptable will probably be the stuff of intense debate for all posterity. But to tax Bitcoin as is you would have to be the centrist state agency ruling over its jurisdiction which is the internet hence it is able to be 'decentralised'. I am not saying that state agencies would never be able to extort or steal Bitcoin & call it taxation because unfortunately anything is possible, but that it will never transparently become standard practice overall because it is contrary to legitimate authority & unethical. This is why the established 'international order' & crony capitalists & their state media have been sidestepping BTC until lately when they have started throwing all manner of kind of childish FUD its way. They don't understand it. It scares them. The opportunity for universal profiteering is unprecedented & the sleepers & party poopers are being forced to reveal themselves
I totally get your thought process, but let me give you an example which would like you to elaborate on according to your theory:
In some countries there is such a thing as a gift tax. Without going into further detail regarding concrete numbers in specific countries, let's just assume that Bitcoin is valued at 20,000 USD and a person I know well has a piece of art that is officially valued at 10,000 USD and we know that because that piece of art is a limited edition of 100 pieces and there is a relatively liquid market where I could also buy that piece of art in cash for 10,000 USD. But since I know the person well, I make a private transaction and pay with the Bitcoin valued at 20,000 USD. On on the balance sheet that person now officially owns 10,000 USD more in wealth. Later on, that person doesn't sell the Bitcoin for cash but buys a car valued at around 20,000 USD in a private transaction from someone else.
As per the balance sheet, the person accrued 10,000 USD in wealth. Is any tax due according to your point of view? Wouldn't that be one of those typical loopholes people could make use of just by not going through a state controlled fiat currency?
Although I myself do by far not agree with many of the existing tax rules, the real question is how Bitcoin is treated in front of the (tax)law. There are rules in some countries when tax exemption applies for the usage or sale of Bitcoin after a certain period of time. The same applies to a piece of art. If I buy a piece of art for 100,000 USD and sell it for 200,000 USD a week later, usually tax applies in the form of capital gains tax. It doesn't matter what I buy with the piece of art, tax applies for as long as the thing is worth more than what I bought my piece of art for initially.
To take it one step further: one could argue that tax is supposed to be used for the infrastructure I make use of in the country I live. Streets, hospitals, schools, etc. Now an interesting question is this: if you argue that Bitcoin is decentralized in its trust sense, what if I live in a country that provided a substantial amount of mining power? Am I not somehow using or benefitting from infrastructure that my country provides in the form of electricity grids, space, ISPs, etc? The problem is that things get too complex.
I understanding the sort of assumptions you are bringing to the argument, but I would like to continue demolishing at least a couple of them
To deal with the case of a purchase of art, it doesn't make any sense. Shady art valuations & purchases have long been used as a means of money laundering & art is an emotive quality. So you seem to be suggesting that a person uses the buying of a piece of art in Bitcoin as a means to protect fiat from the tax inspector? Well for starters, if I had a friend offering me a piece of valuable art for $10,000 & Bitcoin was worth $20,000 that day, I would clearly pay him 0.5 Bitcoin for the item. Not the whole Bitcoin, which would defeat the double-send solution by paying twice anyway. What my friend did with his 0.5 Bitcoin would be up to him.
As we know there are certain state actors that are however privately committed to the obnoxious notion that they 'rule the waves' or 'lead the free world' & so they may think they have a right to tax Bitcoin, because without them & their culture such a thing might not exist.
My solution is to not justify them with a response & continue with the project of universal suffrage & popular sovereignty, whatever they call these things. It is not that a decentralisation movement for individualist internationalism is solely coming from the creation of such currency. But that such currency is an integral part of that wider historical process.
Like the Zen masters say, life is really simple, but analytical thinking has a habit of making it seem complicated
