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Every important person in BitCoin just got subpoenaed by NY financial regulators

forbes.com

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Re: Every important person in BitCoin just got subpoenaed by NY financial regulators

#91

Post by tsuyoshi »

dendory wrote: post #57
DougWebb wrote: post #15

Earlier quoted context omitted.

A bitcoin address is just a container for some amount of BTC. Holding an amount of currency isn't taxable, and exchanging currency often isn't taxable either. (I'm generalizing across jurisdictions, but I think what I'm saying is true for most of them.) If you move money from one pocket to another, or one savings account to another (that you own), that's not taxable. Very many transfers between bitcoin addresses is j…

In Canada, even if you destroy all paperwork and tell the taxman that you don't remember anything, the law permits them to look at your assets and decide how much you owe. Then it's your burden to prove otherwise. Is it different in the US? Hell they could even force exchanges or code mainteners to build in a tax system.

It's the same in the US.

Re: Every important person in BitCoin just got subpoenaed by NY financial regulators

#92

Post by carbocation »

marme wrote: post #89
dclowd9901 wrote: post #66

Earlier quoted context omitted.

I'm trying to think of a way to "test" this, like set up a couple of accounts and programmatically transfer money back and forth. I imagine most banks/processors have some sort of mechanism to limit transactions that would be considered suspect (such as automated back-and-forth transfers). But the lower limit's not a problem -- by repeating the transaction, you'd be contributing to the limit of $/year, even with a mi…

The bank doesnt report you. It is up to you to report yourself as receiving a gift. The entire US tax system works on self reporting and the fact that during audits if you have wilfully lied you will go to jail. So you can transfer some amount a million time and then just say you transferred it once and the IRS will probably never even look into it.

The bank will mandatorily report the transaction if it is $10k or greater (or a series of transactions constructed to fall under the $10k limit).

Re: Every important person in BitCoin just got subpoenaed by NY financial regulators

#93

Post by discobean »

pkulak wrote: post #37
marcell wrote: post #21

Earlier quoted context omitted.

Nothing stops you from create hundreds or even millions of bitcoin addresses, which can act as "accounts." Edit: A bitcoin address is a 160-bit number. That number is associated with a public and private key. The only way you can spend bitcoins stored in an address is if you know the private key of that address. For more information, this video gives a fairly in depth explanation: http://www.youtube.com/watch?v=Lx9zg…

I just wondered to myself how long it would take you to use up all the addresses if you created a trillion per second. 3.6e+17 times the current age of the universe. So, it looks like there are enough addresses for you to really go nuts, if you like. Block chain might get a bit bloated though.

when you create addresses, you can do them offline. Has nothing to do with the blockchain.

Re: Every important person in BitCoin just got subpoenaed by NY financial regulators

#94

Post by jafaku »

threeseed wrote: post #75
bluedino wrote: post #67

Earlier quoted context omitted.

Taxed at what percent? Ludicrous.

Why ? Seems like a great tax to me. The people who are most likely to be hoarding large sums of cash are the type of people who you want to be taxing.

So that they take their money somewhere else?

Re: Every important person in BitCoin just got subpoenaed by NY financial regulators

#95

Post by jchrisa »

colanderman wrote: post #84
bluedino wrote: post #67

Earlier quoted context omitted.

Taxed at what percent? Ludicrous.

How is that any different than controlled dilution of a fiat currency, like the Federal Reserve does? The net result is the same.

It's actually sort of the opposite. Interest based money is designed so that the numeric value grows over time. A tax on holdings makes its numeric value decrease over time. See http://en.m.wikipedia.org/wiki/Demurrage_(currency)

Re: Every important person in BitCoin just got subpoenaed by NY financial regulators

#96

Post by jasonlingx »

threeseed wrote: post #75
bluedino wrote: post #67

Earlier quoted context omitted.

Taxed at what percent? Ludicrous.

Why ? Seems like a great tax to me. The people who are most likely to be hoarding large sums of cash are the type of people who you want to be taxing.

Seems like a great way to discourage saving and keeping people living hand to mouth.

Re: Every important person in BitCoin just got subpoenaed by NY financial regulators

#97

Post by jafaku »

pkulak wrote: post #37
marcell wrote: post #21

Earlier quoted context omitted.

Nothing stops you from create hundreds or even millions of bitcoin addresses, which can act as "accounts." Edit: A bitcoin address is a 160-bit number. That number is associated with a public and private key. The only way you can spend bitcoins stored in an address is if you know the private key of that address. For more information, this video gives a fairly in depth explanation: http://www.youtube.com/watch?v=Lx9zg…

I just wondered to myself how long it would take you to use up all the addresses if you created a trillion per second. 3.6e+17 times the current age of the universe. So, it looks like there are enough addresses for you to really go nuts, if you like. Block chain might get a bit bloated though.

Addresses are not added to the block chain unless they receive Bitcoin. There are no checks in place to ensure the uniqueness of the address, since it's virtually impossible to generate the same address twice, let alone an address with a positive balance.

Re: Every important person in BitCoin just got subpoenaed by NY financial regulators

#98

Post by nullc »

dendory wrote: post #57
DougWebb wrote: post #15

Earlier quoted context omitted.

A bitcoin address is just a container for some amount of BTC. Holding an amount of currency isn't taxable, and exchanging currency often isn't taxable either. (I'm generalizing across jurisdictions, but I think what I'm saying is true for most of them.) If you move money from one pocket to another, or one savings account to another (that you own), that's not taxable. Very many transfers between bitcoin addresses is j…

In Canada, even if you destroy all paperwork and tell the taxman that you don't remember anything, the law permits them to look at your assets and decide how much you owe. Then it's your burden to prove otherwise. Is it different in the US? Hell they could even force exchanges or code mainteners to build in a tax system.

Yup, same in the rest of the civilized world. People scaremongering about Bitcoin and taxation really have no idea how taxation works.

Sure, there will be small amounts of fraud— there always is— but if cash didn't kill taxes, Bitcoin sure won't. The incentives are just setup to make tax fraud at any real scale unattractive.

Re: Every important person in BitCoin just got subpoenaed by NY financial regulators

#99

Post by e12e »

bluedino wrote: post #67
e12e wrote: post #65

Earlier quoted context omitted.

> Holding an amount of currency isn't taxable It is in Norway - any cash or deposits in excess of 750.000 NOK (around 125.000 USD or so) is taxed in addtion to interest being taxed as income. Now, cash isn't easily detectable, so it is a very easy asset to hide -- but while possible, that would be tax evasion and is illegal.

Taxed at what percent? Ludicrous.

Around 1%. The reasoning is partly to encourage reinvestment (stocks are taxed differently).

Re: Every important person in BitCoin just got subpoenaed by NY financial regulators

#100

Post by pmorici »

Looks like this might be the least of BitCoin's government problems. Check out this appropriations bill currently before congress; http://beta.congress.gov/congressional-report/113th-congress... Search for BitCoin in the text and you get the following gem...

"Money laundering.--The Committee understands that Bitcoins and other forms of peer-to-peer digital currency are a potential means for criminal, terrorist or other illegal organizations and individuals to illegally launder and transfer money. News reports indicate that Bitcoins may have been used to help finance the flight and activity of fugitives. The Committee directs the FBI, in consultation with the Department and other Federal partners, to provide a briefing no later 120 days after the enactment of this Act on the nature and scale of the risk posed by such ersatz currency, both in financing illegal enterprises and in undermining financial institutions. The briefing should describe the FBI efforts in the context of a coordinated Federal response to this challenge, and identify staffing and other resources devoted to this effort."

Talk about a prejudiced statement. Time to call your congress person.

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