The Slow Criminalization of Peer-To-Peer Transfers • Hacker News Board

Re: The Slow Criminalization of Peer-To-Peer Transfers

#31

Post by wmf » Fri, Jun 02, 2017, 10:39 PM UTC

mahyarm wrote: post #26

ouid wrote: post #2

The value of bitcoin was always to evade taxes and launder money, both of which are criminal enterprises, the only thing that is changing is enforcement.

I found it useful for lower costs in sending money across country and currency borders. Someone will reply and say it's not actually cheaper, but what is available for the average joe it is definitely cheaper. It's also faster and more convenient if both sides have bitcoin exchange accounts.

One may wonder, however, why traditional money transfer is more expensive if it doesn't even require mining. Is it because of regulations by any chance?

Re: The Slow Criminalization of Peer-To-Peer Transfers

#32

Post by roguecoder » Fri, Jun 02, 2017, 10:44 PM UTC

If we want to draw the connection to cash, companies that trade in large amounts of cash are also subject to regulation and reporting. For example, U.S. financial institutions are required to file Currency Transaction Reports for deposit, withdrawal, exchange of currency, or other payment or transfer that involves more than $10,000.

Any organization that is facilitating those trades is subject to financial regulation, even if the trade is in cash. Indeed, if the transaction crosses the border even individuals carrying cash have to report it for sufficiently large amounts: https://www.ffiec.gov/bsa_aml_infobase/pages_manual/OLM_035....

If anything this enforcement is treating bitcoin more like cash, not less.

Re: The Slow Criminalization of Peer-To-Peer Transfers

#33

Post by ReverseCold » Fri, Jun 02, 2017, 10:48 PM UTC

Jabanga wrote: post #29

This is unfortunate. The world needs electronic cash, for all the same reasons it needs physical cash. If it weren't for financial bearer instruments, millions would have died all across the globe over the last decade. To understand why, you have to understand System D. System D is the global informal economy, and it is $14 trillion in size. It provides a lifeline for hundreds of millions of people around the world w…

> System D

They implemented another useless thing?!?!?

Re: The Slow Criminalization of Peer-To-Peer Transfers

#34

Post by [deleted] » Fri, Jun 02, 2017, 10:49 PM UTC

Jabanga wrote: post #29

This is unfortunate. The world needs electronic cash, for all the same reasons it needs physical cash. If it weren't for financial bearer instruments, millions would have died all across the globe over the last decade. To understand why, you have to understand System D. System D is the global informal economy, and it is $14 trillion in size. It provides a lifeline for hundreds of millions of people around the world w…

[deleted]

Re: The Slow Criminalization of Peer-To-Peer Transfers

#35

Post by joering2 » Fri, Jun 02, 2017, 11:31 PM UTC

Jabanga wrote: post #28

ouid wrote: post #2

The value of bitcoin was always to evade taxes and launder money, both of which are criminal enterprises, the only thing that is changing is enforcement.

Peer-to-peer electronic cash has numerous uses beyond tax evasion and money laundering, just as physical cash does. But to your point, even these laws are part of a new trend. Money laundering is a relatively new crime, and widespread taxation of private transactions only came into force in the early 20th century, with governments around the world instituting income taxation. 50 years ago, almost all transactions wer…

It is also important to say that the trend of making you most likely criminal "because you use cash" will continue.

It is already known restaurants owners are getting in trouble for small deposits. Its not even $10,000 or $9,000 you deposit.. if you happen to make daily deposits of even few hundred dollars you are guilty of "structuring" aka smurfing.

Another thing is to make sure you can track back your physical hoard of cash. My friend's father is in deep explanations with FBI (and over $50,000 in attorney fees) because when his wife passed away he took all the money they hoard at home under floor and put it in the bank. Some $600,000 of it. IRS didn't like that and proving you had a job all your life and you paid taxes on Over $10,000,000 in income did not stop the case.

Re: The Slow Criminalization of Peer-To-Peer Transfers

#36

Post by cgb223 » Sat, Jun 03, 2017, 12:02 AM UTC

isubkhankulov wrote: post #12

In all of these cases, the bitcoin vendors did not register on FinCEN's website. Registering is simple but by doing so the person/company is required to check ID's of their customers and make sure there is no money laundering involved. Including filing reports with the gov't for any suspicious activity and large cash transactions amongst other things.

How would one launder money with bitcoin?

What would that look like?

Re: The Slow Criminalization of Peer-To-Peer Transfers

#37

Post by Shorel » Sat, Jun 03, 2017, 12:02 AM UTC

ouid wrote: post #2

The value of bitcoin was always to evade taxes and launder money, both of which are criminal enterprises, the only thing that is changing is enforcement.

Or to avoid losing too much money when traveling abroad and using your credit card in bank-initiated currency conversions.

Seriously, some simple grocery shopping I did had a 'currency exchange' tax of about 10% - 15%.

Re: The Slow Criminalization of Peer-To-Peer Transfers

#38

Post by abritinthebay » Sat, Jun 03, 2017, 12:09 AM UTC

roguecoder wrote: post #32

If we want to draw the connection to cash, companies that trade in large amounts of cash are also subject to regulation and reporting. For example, U.S. financial institutions are required to file Currency Transaction Reports for deposit, withdrawal, exchange of currency, or other payment or transfer that involves more than $10,000. Any organization that is facilitating those trades is subject to financial regulation…

Agreed. The problem is that Bitcoin wants to be taken seriously as a currency while at the same time not being subject to all the rules and regulations imposed on currencies.

This was predicted years ago by most critics but was most often just hand-waved away by advocates, most responding that it was impossible to regulate the system itself.

Well.. yeah, so you regulate assets and income of the people and companies involved. That's how it works with regular currency too.

It's a problem any currency system has (even barter!)

Re: The Slow Criminalization of Peer-To-Peer Transfers

#39

Post by Shorel » Sat, Jun 03, 2017, 12:12 AM UTC

wmf wrote: post #31

mahyarm wrote: post #26

Earlier quoted context omitted.

I found it useful for lower costs in sending money across country and currency borders. Someone will reply and say it's not actually cheaper, but what is available for the average joe it is definitely cheaper. It's also faster and more convenient if both sides have bitcoin exchange accounts.

One may wonder, however, why traditional money transfer is more expensive if it doesn't even require mining. Is it because of regulations by any chance?

Banks have a very profitable spread when buying and selling foreign currencies.

For transfers of money in the same currency... it's just greed, in my opinion.

Re: The Slow Criminalization of Peer-To-Peer Transfers

#40

Post by AnthonyMouse » Sat, Jun 03, 2017, 12:23 AM UTC

giobox wrote: post #6

ouid wrote: post #2

The value of bitcoin was always to evade taxes and launder money, both of which are criminal enterprises, the only thing that is changing is enforcement.

I agree with this to some extent. As much as I consider myself a 'small l' libertarian, is a society in which taxes could be evaded so freely on such a large scale really desirable? We already struggle with this problem enough with 'traditional' financial tools. It's certainly worth thinking about.

> is a society in which taxes could be evaded so freely on such a large scale really desirable?

Tax evasion has been and always will be an issue of popular morals. All you need for evasion is a medium of exchange (or barter) and for both sides not to report the transaction.

Collecting taxes is trivial when either (or both) of the parties to a transaction report it and impossible if they don't. So the only way taxes can work is for most people to be convinced that the taxes are reasonable and what they pay for is justified. If most people are not convinced then they'll lie for each other and the government is screwed; see Italy. Central banks can't save you from that, only your own citizens can.

And the laws against money laundering have nothing to do with tax evasion by the common man and everything to do with the war on drugs. Putting a stop to that train wreck would only help everybody.