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U.S. Senate Vote in Favor of Amendment That Threatens Crypto Industry

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Re: U.S. Senate Vote in Favor of Amendment That Threatens Crypto Industry

#141

Post by doomroot »

JumpCrisscross wrote: post #102
woah wrote: post #95

Earlier quoted context omitted.

Your comment is completely unrelated to the matter at hand, and the article. The controversy here is about this law potentially placing reporting obligations on software developers who never have any custody of client funds. Sort of like requiring the developers of Excel to report on users of Excel using it to manage their money. > I've also been struck by the proliferation of bank-like services without bank-like obl…

> reporting obligations on software developers who never have any custody of client funds Custody doesn't haven an agreed-upon definition when it comes to crypto. That's the nut of the challenge. If we want reporting, someone who, in a traditional setting, would not have had to report, will when it comes to cryptocurrencies. > these centralized services that have some involvement with crypto already comply with a lar…

> Custody doesn't have an agreed-upon definition when it comes to crypto.

This is not true, custody is very well understood when it comes to blockchain assets. Legal definitions of ownership are another question altogether that do require continual legislative attention, see Wyoming’s work in this area.[1]

You’ve also repeated the sins of the top comment by glossing over the actual issues with this provision by focusing on facts that almost everyone in the cryptocurrency space are in total agreement on.

> Tether and Binance are exemplars of pathological noncompliance.

The amendments to this provision are focusing on who should be excluded from these new requirements, of which Binance & Tether (or terms that could be construed to mean Binance or Tether) are nowhere to be found. The exceptions focus on miners, node operators, noncustodial software providers, and alternative consensus mechanism validators.

[1] https://www.google.com/amp/s/slate.com/technology/2021/06/wy...

Re: U.S. Senate Vote in Favor of Amendment That Threatens Crypto Industry

#142

Post by cinquemb »

dcolkitt wrote: post #138
frankbreetz wrote: post #109

Earlier quoted context omitted.

Drug laws caused the average person to be terrified of drugs. If the average person becomes as scared of crypto as they are of drugs, crypto may exist, it won't be a mainstream product. There are no vc funded cocaine or heroine companies.

Except crypto is global, and even easier to move across borders than drugs. Despite the government's sincerest hopes, American laws don't extend to foreign countries. So, yes there will still be tons of VC funded crypto startups, they'll just be based in Malta or Israel or Singapore. And even in the most draconian enforcement regime, the US government will be incapable of stopping even 1% of American citizens who cho…

> You'd have to be extremely anti-crypto to think it justifies the creation of a Chinese-style great firewall and the associated surveillance state.

Even then, I see plenty of chinese users (talking in mandarin) on various forums/servers using decentralized protocols, hardly that effective.

Pipe dream laws for pipe dream deficit spending to continue to prop up zombie companies and industries.

Re: U.S. Senate Vote in Favor of Amendment That Threatens Crypto Industry

#143

Post by tfehring »

flyingfences wrote: post #112
tfehring wrote: post #58

I guess I don’t understand what the amendment actually does. If you’re a crypto miner, you already have to report your own income from that activity to the government; failure to do so is already a crime, namely tax evasion. And if you’re not a custodian, by definition your own activity is the only activity that you have data on, right? What new reporting does this actually mandate?

This mandates miners (and developers, and others who are not custodians) reporting data on others that they do not and cannot have.

Right, that's what the article says, but what specific data would they be required to report and in what context?

Re: U.S. Senate Vote in Favor of Amendment That Threatens Crypto Industry

#144

Post by starkd »

woodruffw wrote: post #133
starkd wrote: post #114

Earlier quoted context omitted.

Well, they are instrumental in oppressive governments like Iran and Venezuela. The whole objective behind cryptocurrency is a digital cash. If you are unconcerned about it happening in US, I don't know what basis you have for that, other than it has never has. It could happen here just as easily. And faster than you think. And corrupt governments are not known for being quick to give rights back.

But this is a different scenario: Iran and Venezuela were ostensibly repressive long before cryptocurrencies became viable mechanisms for exfiltrating wealth from either country. And besides, the introduction of cryptocurrencies doesn’t seem to have helped much in terms of making either country less repressive (much less eliminating basic privation in either). To whit: what bulwark, precisely, are cryptocurrencies pr…

Iran and Venezuela would not have the crypto tool if it had not been for a free society in which they can operate. The fact they were tyrannical oppressive regimes before crypto came along is besides the point. They have them now and are proving useful for their citizens. I don't know how you say they haven't helped "much". I've heard they are proving very useful. Maybe not in overthrowing the regime, but at least in helping them to survive.

It's definitely useful in the hyperinflation environments happening in those countries.

Re: U.S. Senate Vote in Favor of Amendment That Threatens Crypto Industry

#145

Post by dcolkitt »

JumpCrisscross wrote: post #63
zarzavat wrote: post #51

Earlier quoted context omitted.

The entire point of cryptocurrency is precisely to enable bank-like services without bank-like obligations, to enable individuals to be their own bank and manage their own money if they want to. You're right that it's unsurprising that the US Senate does not care about this problem. On the other hand, I'm pretty sure that the cryptocurrency world does not care about the US Senate. This will just end up being another…

> point of cryptocurrency is precisely to enable bank-like services without bank-like obligations Crypto has shown some rules are unnecessary or even harmful. They should be repealed, across the board. In other cases, many cases, it's reinforced some rules' necessity. Their scope should be broadened. That's what's going on here. If the sole value of cryptocurrencies is in evading the rules, it's going to have a tough…

> This, alone, is insufficient. AML duties aren't discharged by an "I promise I'm not a money launderer or tax evader" checkbox.

A Maltese company operating a server in Russia is under no obligation to follow US law for a customer who attests that he's Israeli. American KYC/AML provisions do not extend to the entire globe, and non-American entities are under no legal obligation to comply with them.

It is true that the US has a long arm of pressure that exists in the form of the SWIFT banking system. But the thing about crypto native companies is they never touch SWIFT to begin with. So unless you propose deploying the 101st Airborne to Valletta, how do you propose forcing foreign crypto companies from complying with US regulations.

Re: U.S. Senate Vote in Favor of Amendment That Threatens Crypto Industry

#146

Post by starkd »

logicchains wrote: post #75
starkd wrote: post #72

Earlier quoted context omitted.

Cryptocurrency is also a hedge against tyranny. There seems to be a naive belief that it can never happen here, just because it never has.

>There seems to be a naive belief that it can never happen here, just because it never has. What do you mean it never has? FDR literally stole everybody's gold in 1933 and got away with it.

Good point. Tyranny is not all or nothing gambit.

Re: U.S. Senate Vote in Favor of Amendment That Threatens Crypto Industry

#147

Post by starkd »

spaginal wrote: post #134
JumpCrisscross wrote: post #76

Earlier quoted context omitted.

> underground economies benefit oppressed people when governments turn tyrannical They also benefit the rich and powerful by enabling tax evasion and graft. Pyongyang, Tehran and Caracas make regular use of illicit trade and money laundering to facilitate upward wealth transfer. Yours is a legitimate point. It's an argument for curtailing the power of law and government. That's fine. We can debate that. But until Ame…

Cash and anonymous digital transactions also benefit the lower end as well. Many poor families, including immigrants, get through life daily with an underground, cash only, economy. It's not just a tool of the rich and wealthy. Taxation on assets and income is THEFT.

A lot of people work in the underground economy. It's useful when excessive government regulations prevent "undesirables" from being hired.

Re: U.S. Senate Vote in Favor of Amendment That Threatens Crypto Industry

#148

Post by AnthonyMouse »

JumpCrisscross wrote: post #31

I've been following this discussion in Washington and on Hacker News. I'm moderately anti-crypto--I don't buy the pitch but am open to being wrong and believe folks should be free to do what they want with it. I've also been struck by the proliferation of bank-like services without bank-like obligations. This stretches from fractional-reserve and maturity-transforming services like Tether to exchanges/dealers like Bi…

> If the answer is there should be no AML, KYC (edit: know-your-customer rules) and/or reporting by cryptocurrency companies, we have no common ground on this argument.

I still don't understand this. KYC has devolved into something unreasonable and it needs to be removed from the existing system, not extended.

When KYC was originally implemented, your bank was where you deposited your paycheck, paid your mortgage and withdrew some cash every few weeks for your expenses. If your bank knew who you were, they knew where you lived and where you worked. The first is a matter of public record and the second isn't exactly a big secret. Maybe you also had a car loan.

Today it has been extended to everything you buy on the internet or with a credit card, and people now buy everything on the internet and with credit cards. It ties your government identity to the books you read, the medical care you receive, genetic tests, what you eat, the establishments you patronize, your location history if you go anywhere and buy gas or anything else, who else was there at the same time, it's your whole life.

We need the ability to buy a copy of Das Kapital or a drink at a gay bar without being put on a List.

Re: U.S. Senate Vote in Favor of Amendment That Threatens Crypto Industry

#149

Post by repler »

thanksforfish wrote: post #10

Relevant Senate links appear to be: • https://www.senate.gov/legislative/LIS/roll_call_lists/roll_... • https://www.finance.senate.gov/imo/media/doc/Wyden%20Lummis%...

There are a whopping 505 amendments for this bill.

Thank you for the direct link to the Wyden/Lummis/Toomey amendment.

I don't know how anyone can keep track of what a final bill would look like - seriously need something like Git to even keep up.

I think I understand now when folks in Congress complain they "don't know what they're voting for". They need better tools.

Here are all 505 if anyone is interested: https://www.congress.gov/amendment/117th-congress/senate-ame...

Re: U.S. Senate Vote in Favor of Amendment That Threatens Crypto Industry

#150

Post by armatav »

gizmo686 wrote: post #122
echopurity wrote: post #99

Many people start coding at a young age. Imagine your kid having to report their dapp to the IRS. It's not about the money. It's about the control. The situation is probably worse for adults. Why go through the hassle of developing dapps when it means dealing with the IRS and potentially jail, etc.? Personally I've abandoned working on completely harmless dapps because of threats from the state. It's stifling for ind…

Many people start wood working at a young age. If they want to build a house, they need to acuire permits, comply with zoning regulation, comply with building codes, get sign off from a certified engineer. Not all coding is the same. If you want to work to code in a regulated industry, you need to play by the regulations. Finance is a regulated industry, not a sandbox.

Yeah but at the same time if you mint a few beautifully patterned - 300 hours-of-work each - wood coins and trade them; it’s not finance and it’s unregulated.
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