The Lightning Network: Turning Bitcoin into Money • Hacker News Board

Re: The Lightning Network: Turning Bitcoin into Money

#221

Post by samatman » Wed, Jul 13, 2022, 6:51 PM UTC

ska wrote: post #124

samatman wrote: post #60

Earlier quoted context omitted.

I'm of the opinion that the rules are behind the law when it comes to BTC. I am deeply uninterested in being anywhere near the legal case that challenges this! But currency exchange for 'ordinary purposes' is not taxed, if my company bought some Euros to pay for foreign goods and the Euro rallied against the dollar before the purchase, no tax is owed. Well, BTC is legal tender in El Salvador, and there's no rule that…

I don't think the OP was bringing up the FX tax implications, but rather tax on the sale of a service.

That seems unlikely to me, since income tax has to be paid by recipients whether payment is in coin or in kind.

BTC is a kind. If I pay you in silver rounds, you are responsible for paying income tax for the convertible value of the silver at the time of payment, but not capital gains at any point.

Re: The Lightning Network: Turning Bitcoin into Money

#222

Post by Aaronstotle » Wed, Jul 13, 2022, 6:51 PM UTC

TrapLord_Rhodo wrote: post #210

Aaronstotle wrote: post #197

Earlier quoted context omitted.

Bitcoin is not fungible and because of its hard cap does not incentive actual use as a means of exchange. I'll never understand why BTC Maximalists refuse to acknowledge faults in BTC and see how other currencies can solve them.

> its hard cap does not incentive actual use as a means of exchange. Why? Is that because it's has 'Scarcity'? People will pay more for it in the future? If that case is so soundly put why would you not buy as much btc as possible? Playing a bit of devils advocate here but wouldn't you say that it's volitility leads to more trading? Means of exchange need to be further defined in this crazy overfinancialized world we…

I'll use my own example, I purchased a month of a VPN service using BTC when it was ~11k, it's about $5 in fiat per month.

If you believe BTC will only go up, I don't see why you would want to spend it if your money will be worth more if you wait.

Regarding Volatility, yes it leads to a lot of trading, I mean means of exchange as purchasing everyday goods. The transaction history of BTC also adds regulatory hurdles.

Re: The Lightning Network: Turning Bitcoin into Money

#223

Post by hnthrow1010 » Wed, Jul 13, 2022, 6:52 PM UTC

wahnfrieden wrote: post #193

hnthrow1010 wrote: post #137

Earlier quoted context omitted.

It's not still early days. Bitcoin was created 13 years ago, it was useless for payments back then and it's still useless for payments now. Every direction that anyone takes it will be in the direction of some kind of pure money-making thing, usually in the form of a ponzi or pyramid scheme. This has happened over and over again for 13 years. There's simply no one else interested in building on this because everyone…

tired and copypasta-like impulsive response written in hysterics is why you're getting downvoted

That makes no sense. I wouldn't have to keep repeating myself if crypto people didn't also do the same thing. Also, please don't describe the act of disagreeing as being "in hysterics", that's bad discussion.

Re: The Lightning Network: Turning Bitcoin into Money

#224

Post by lxgr » Wed, Jul 13, 2022, 6:52 PM UTC

meowkit wrote: post #185

lairv wrote: post #107

Earlier quoted context omitted.

> it would be reasonable to only treat the eventual on-chain withdraw as a taxable event wouldn't that be an easy way to bypass taxes ? make all your transactions off-chain and just withdraw once a year ?

No. Its a settlement layer. I do 1000 streaming transactions on a channel. When the channel is closed (withdrawn back to the L1 chain, or settled - offchain is the wrong term here Lightning is an L2 "channel"), the transactions are summarized and you can tax that summary event. It's a linear sum of taxes. Of course there are scenarios that complicates things like variable sales tax rates based on transaction type/loc…

By the same logic, anything you do on a custodial exchange could never be a taxable event because it's never settled on-chain. I'd be extremely surprised if the IRS would share your view.

Re: The Lightning Network: Turning Bitcoin into Money

#225

Post by [deleted] » Wed, Jul 13, 2022, 6:53 PM UTC

adamrezich wrote: post #187

Grumbledour wrote: post #63

Earlier quoted context omitted.

I really dislike this whole initiative and much prefer the patreon model. One reason of course might be that i am listening to Jupiter Broadcast and Chris pushes this stuff hard, really annoying me with the constant talk about lightning and especially the boosts, which seem to take over half the show, because somehow he seems not to realize that the problem he has in getting regular supporters is the insane price he…

why should content creators have to go through a centralized website like Patreon in order to get value from their consumers, giving Patreon a cut in the process? sure it's (for now) more straightforward for end-users, but as a content creator you're locking yourself into the Patreon Platform, you're building (at least some subset of) your content and your business around it being specifically "Patreon content". I'm…

[deleted]

Re: The Lightning Network: Turning Bitcoin into Money

#226

Post by hnthrow1010 » Wed, Jul 13, 2022, 6:54 PM UTC

waoush wrote: post #181

hnthrow1010 wrote: post #137

Earlier quoted context omitted.

It's not still early days. Bitcoin was created 13 years ago, it was useless for payments back then and it's still useless for payments now. Every direction that anyone takes it will be in the direction of some kind of pure money-making thing, usually in the form of a ponzi or pyramid scheme. This has happened over and over again for 13 years. There's simply no one else interested in building on this because everyone…

(note: I didn't downvote, but have been working with blockchain and thought I would answer since you haven't gotten any yet) https://www.hyperledger.org/learn/case-studies Hyperledger is a set of open-source distributed ledger related technologies, the most well-known being Fabric, which is a framework for creating blockchain networks. The most interesting cases are S&P Global and Walmart, who use it to keep track of…

I've seen those and I wouldn't describe them as "blockchains" in the same sense that cryptocurrencies use it. The word seems to only be used for marketing purposes. Those are just an ordinary ledger with some sharding/mirroring.

Re: The Lightning Network: Turning Bitcoin into Money

#227

Post by ska » Wed, Jul 13, 2022, 6:55 PM UTC

samatman wrote: post #221

ska wrote: post #124

Earlier quoted context omitted.

I don't think the OP was bringing up the FX tax implications, but rather tax on the sale of a service.

That seems unlikely to me, since income tax has to be paid by recipients whether payment is in coin or in kind. BTC is a kind. If I pay you in silver rounds, you are responsible for paying income tax for the convertible value of the silver at the time of payment, but not capital gains at any point.

sales tax, not income tax. someone has to calculate, report, and remit it for all these micro transactions somehow. I thought that is what GP was referring to , may be mistaken.

In that context cap gains vs other sorts of income is irrelevant.

Re: The Lightning Network: Turning Bitcoin into Money

#228

Post by TrapLord_Rhodo » Wed, Jul 13, 2022, 6:55 PM UTC

cryptica wrote: post #199

Lightning network is a hack. It doesn't actually work. - There are many ways for a malicious entity to rollback a payment and prevent it from being detected (just DoS the watchtowers). - You still need to make an on-chain transaction to open a new channel which incurs on-chain fees and limits the scalability of LN. It's incredible how money can corrupt large groups of people into convincing themselves that a solution…

You're right, it's a hack. Doesn't mean it's wrong and doesn't work though.

BTC stopped being practical for small payments when it got expensive. This is a way to make small, everyday payments cheap again. I'm not going to use LN to transfer large payments. "just DoS the watchtowers" is impracticle for a cup of coffee. Your second point is just plain false and there are many ways around those.

Re: The Lightning Network: Turning Bitcoin into Money

#229

Post by tablespoon » Wed, Jul 13, 2022, 6:56 PM UTC

rewtraw wrote: post #217

shmatt wrote: post #195

Earlier quoted context omitted.

Like 99% of crypto projects, this would work just as well under a centralized db / FIAT

I'm consistently surprised by HN's lack of vision in this area. The idea of a Network State / Internet-native economy is a cyberpunk dream, and crypto enables that. The constant doubt, rejection, and preference for SV-startup solutions is the opposite of what I would expect from a "Hacker Community" but I suppose HN is literally full of VCs (particularly FinTech) that don't want the competition from open crypto solut…

> I'm consistently surprised by HN's lack of vision in this area. The idea of a Network State / Internet-native economy is a cyberpunk dream, and crypto enables that.

How so? Isn't the "cyberpunk dream" a dystopia?

Re: The Lightning Network: Turning Bitcoin into Money

#230

Post by the_gastropod » Wed, Jul 13, 2022, 6:57 PM UTC

teekert wrote: post #5

A cool use of the Lightning network is the podcast 2.0 initative. Currently, as I listen to podcasts, I stream back satoshis (sats), value for value (I use Castamatic on iOS, fountain.fm is also an option on Android). You can also send messages with sats attached, called “boosts”. Creators can transparantly split the sats they receive over various goals (i.e. FOSS projects [opensats], or guests on shows). There are n…

Let's ignore the Lightning Network for a moment, and dig into the meat of what you're suggesting: that people—in some meaningnful number—would prefer to spend money to get a thing they currently get for free (with the caveat that they occasionally they have to listen to / watch advertisements). Maybe you're right! But: 1. I doubt it. And 2. Lightning Network isn't the only technological solution to such an idea. This concept isn't particularly common, probably, because most people will put up with a lot to avoid spending actual money.