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Senators move to exempt Bitcoin, crypto miners from proposed U.S. tax rules

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Re: Senators move to exempt Bitcoin, crypto miners from proposed U.S. tax rules

#221

Post by qeternity »

cwkoss wrote: post #154
deegles wrote: post #134

Earlier quoted context omitted.

Devil's advocate for a moment... the definition of a broker is "a person who buys and sells goods or assets for others," or it can mean to "arrange or negotiate" a deal or plan. How is a miner not a broker then? They accept transactions and then place them on a blockchain by performing some kind of work. Sure, at the moment few if any cryptos are definitely securities, but what is going to happen when a company creat…

Miners never have custodial control of the funds in those transactions. They are much more like auditors or accountants than brokers.

Custodial control is an oxymoron.

They are facilitating a transaction. They can choose to accept or reject a transaction. In this capacity, they are most similar to a broker-dealer.

Re: Senators move to exempt Bitcoin, crypto miners from proposed U.S. tax rules

#222

Post by sunshinerag »

arcticbull wrote: post #210
sunshinerag wrote: post #152

Earlier quoted context omitted.

No, there is no waste. It is a very efficient conversion of energy to security of the ledger. And with that ledger instead of all the wars and waste generated by manipulatable central bank ledgers it’s a win.

Bitcoin is the single least efficient system ever conceived of or reduced to practice by mankind.

Is there a more efficient system to arrive at consensus of a state in a distributed, trust-less, permission less manner?

Re: Senators move to exempt Bitcoin, crypto miners from proposed U.S. tax rules

#223

Post by qeternity »

meowkit wrote: post #84
animal_spirits wrote: post #76

> That means that the IRS will not be able to require that miners, stakers and companies that sell hardware or software for storing digital assets report the activities of their customers or crypto users whose transactions they verify. > In a statement, Wyden said that “investors failing to pay tax they owe through cryptocurrency is a real problem,” but that the law as previously written was too broad and would have…

You’re off base. The original definition was putting tax and KYC requirements on people who don’t have, and can’t get, that information. Network nodes facilitate transactions, they don’t broker them. Its like treating an exchanges electricity provider as part of the equity trade. It’s not tax evasion. The law as originally stated would have crippled the industry in the US.

> The original definition was putting tax and KYC requirements on people who don’t have, and can’t get, that information.

You fundamentally misunderstand regulation. If someone can’t/won’t do something, regulation is enacted to either compel them or to outlaw their behavior.

Your tacit suggestion that because miners can’t do something means the law is flawed, is akin to saying “oh well burglars won’t pay for the goods so oh well”. If we pass a law that miners can’t follow, then mining becomes illegal. We do this all time, especially in finance.

A more realistic example is “WhatsApp is E2E encrypted so traders can’t be monitored”. This means WhatsApp is a non-compliant (“illegal”) facility to transact in most regulated markets.

Re: Senators move to exempt Bitcoin, crypto miners from proposed U.S. tax rules

#224

Post by sunshinerag »

vkou wrote: post #156
sunshinerag wrote: post #152

Earlier quoted context omitted.

No, there is no waste. It is a very efficient conversion of energy to security of the ledger. And with that ledger instead of all the wars and waste generated by manipulatable central bank ledgers it’s a win.

1. There is nothing efficient about wasting that much electricity on securing a ledger that can handle single-digit transactions per second. 2. The needs of central banks don't start wars, the needs of politicians, warhawk nationalists, and the needs of modern industrial economies do. [1] Unless BTC somehow magically gets rid of politicians, nationalism, or of our addiction to oil, that's not going to change. [1] The…

Wars are used to force citizens to give up their labour for free to the state. In a country with financial mismanagement wars can be used to erase debts.

The US does and will go to war if it feels its dollar/oil hedgemony is threatened. if the dollar demand/circulation outside US falls for any reason, it will cause hyperinflation within the US economy. So they have to constantly threaten/intimidate other countries.

Re: Senators move to exempt Bitcoin, crypto miners from proposed U.S. tax rules

#225

Post by sunshinerag »

vkou wrote: post #156
sunshinerag wrote: post #152

Earlier quoted context omitted.

No, there is no waste. It is a very efficient conversion of energy to security of the ledger. And with that ledger instead of all the wars and waste generated by manipulatable central bank ledgers it’s a win.

1. There is nothing efficient about wasting that much electricity on securing a ledger that can handle single-digit transactions per second. 2. The needs of central banks don't start wars, the needs of politicians, warhawk nationalists, and the needs of modern industrial economies do. [1] Unless BTC somehow magically gets rid of politicians, nationalism, or of our addiction to oil, that's not going to change. [1] The…

Layer 1 transactions are not necessarily 1 to 1 transactions. They can be settling millions of transactions in Layer 2 (lightning). It helps to think of layer 1 transactions as a settlement layer.

Re: Senators move to exempt Bitcoin, crypto miners from proposed U.S. tax rules

#226

Post by vkou »

sunshinerag wrote: post #224
vkou wrote: post #156

Earlier quoted context omitted.

1. There is nothing efficient about wasting that much electricity on securing a ledger that can handle single-digit transactions per second. 2. The needs of central banks don't start wars, the needs of politicians, warhawk nationalists, and the needs of modern industrial economies do. [1] Unless BTC somehow magically gets rid of politicians, nationalism, or of our addiction to oil, that's not going to change. [1] The…

Wars are used to force citizens to give up their labour for free to the state. In a country with financial mismanagement wars can be used to erase debts. The US does and will go to war if it feels its dollar/oil hedgemony is threatened. if the dollar demand/circulation outside US falls for any reason, it will cause hyperinflation within the US economy. So they have to constantly threaten/intimidate other countries.

> Wars are used to force citizens to give up their labour for free to the state.

Wet streets don't cause rain, and wars aren't started in order to collect taxes. Wars are started to pursue particular goals, many of which I have listed in my prior post.

> The US does and will go to war if it feels its dollar/oil hedgemony is threatened.

This is an interesting, and oft-repeated theory, that, unfortunately does not survive contact with history. It's not a strong explanation for the majority of the conflicts that the US has been involved in. It is not remotely an explanation for the majority of the conflicts that other countries are involved in.

Which dollar/oil hegemony is Russia trying to maintain in Crimea? China in Tibet? USSR in Afghanistan? Argentina in the Falklands? Sudan in Darfur? Israel in Lebanon? Saudi Arabia in Yemen? ISIS in Syria?

Never mind that BTC doesn't do a thing about the dependency of industrialized sociaties on oil, minerals, fresh water, and other limited material resources.

Re: Senators move to exempt Bitcoin, crypto miners from proposed U.S. tax rules

#227

Post by cwkoss »

qeternity wrote: post #221
cwkoss wrote: post #154

Earlier quoted context omitted.

Miners never have custodial control of the funds in those transactions. They are much more like auditors or accountants than brokers.

Custodial control is an oxymoron. They are facilitating a transaction. They can choose to accept or reject a transaction. In this capacity, they are most similar to a broker-dealer.

I see what you're saying, but a single miner can't reject a transaction, they can really only delay it.

Re: Senators move to exempt Bitcoin, crypto miners from proposed U.S. tax rules

#228

Post by arcticbull »

sunshinerag wrote: post #222
arcticbull wrote: post #210

Earlier quoted context omitted.

Bitcoin is the single least efficient system ever conceived of or reduced to practice by mankind.

Is there a more efficient system to arrive at consensus of a state in a distributed, trust-less, permission less manner?

Well there's proof of stake. However, whether alternatives exist or not has no bearing on the efficiency of a system.

Re: Senators move to exempt Bitcoin, crypto miners from proposed U.S. tax rules

#229

Post by spiralx »

godelski wrote: post #187
JumpCrisscross wrote: post #150

Earlier quoted context omitted.

> this crypto tax provision was slid into a huge bipartisan infrastructure deal. It really never should have been included in this legislation in the first place. Why not? The infrastructure is being paid for in part by this tax. They're fundamentally linked.

I think a lot of people, myself included, would like bills to be hyper focused and ban the use of riders. There are a few reasons for this. One is that it is easier to keep track from the public perspective. A title should reflect the contents of the bill (in this case it is not obvious that bitcoin regulations are part of infrastructure). This could help reduce confusion and manipulation. It helps with transparency…

Without riders and earmarks there's no way to get someone to support your bill if they don't like the concept to start with. There's no downside for not supporting a bill, so cutting half of its provisions will still half to vote against. Riders and earmarks allow politicians to secure minor wins that they can sell to their electorate as the reason for supporting a bill.

And most of these things would simply never pass as standalone bills, being too small and local for Congress as a whole, and too expensive or cross-jurisdictional for state governments.

Re: Senators move to exempt Bitcoin, crypto miners from proposed U.S. tax rules

#230

Post by spiralx »

chollida1 wrote: post #160
thehappypm wrote: post #60

Earlier quoted context omitted.

Venmo's core value right now is that it's ubiquitous. Everyone has a Venmo account and everyone trusts it. I paid an electrician through it yesterday -- no new Fed tech is going to replace it overnight, just like Zelle didn't kill it either.

> Venmo's core value right now is that it's ubiquitous Is it? I just did a straw poll of people in my office, located in Canada. People from 28-50 no one has venmo. 3 of 15 knew about it. Now my sample may not match the rest of the world as these are some pretty highly educated and high networth individuals so venmo isn't something that would really benefit us, but it does really weaken the ubiquitous claim Where is…

> Where is Venmo ubiquitous?

Always remember that consumer banking in the US is at least a decade behind everywhere else in the first world. Apps that allow cheap/free and fast money transfers were and still are a big deal there.

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