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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

#21

Post by verdverm »

dcolkitt wrote: post #17
verdverm wrote: post #15

Earlier quoted context omitted.

Same can be said for stocks, yet the crash of 1929 still happened and laws were written to help protect consumers and the economy

The response to 1929 wasn’t to functionally outlaw the existence of stocks.

This law does not functionally outlaw the existence of cryptocurrency, it clarifies requirements to operators that they cannot escape AML.

I would expect a court to find that PoS is close enough to PoW as Congress intends this legislation, without digressing into the various types of PoS. While poorly written, it is likely that pure network operations will be ok long term.

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

#22

Post by jcranmer »

JediWing wrote: post #18

What are the reporting requirements? Will they lead to taxation? Overhead computing resource per block/transaction validated? Is this reporting only, or will it result in additional taxes? This seems light on details, and I really don't know what opinion to have on this without understanding what the requirements are. Nothing I've read succinctly explains this.

The same reporting requirements as banks. So the amendment is basically saying that anything that looks bank-ish in cryptocurrency terms will actually be treated as a bank for KYC/AML requirements. The consternation is that the "anything that looks bank-ish" is too broadly defined, but from my reading, it really isn't.

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

#23

Post by tantalor »

Retric wrote: post #20
dcolkitt wrote: post #16

Earlier quoted context omitted.

The term “derivatives” is widely used for financial derivatives like options and swaps. It’s gained such widespread adoption that it by far dwarfs the original meaning of the instantaneous rate of change in calculus. I think the simpler answer is that when a word has two meanings, one a widely used category of financial instruments and the other a narrowly defined branch of advanced mathematics, the former will almos…

Possibility, I have heard “derivatives” most commonly used as a math term not a financial one. But it’s got plenty of other meanings: https://www.merriam-webster.com/dictionary/derivative

As in "something that originates from something else"

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

#24

Post by cs702 »

WINNERS: Large corporations and financial institutions. They can afford the now-required overhead for all kinds of services, including transaction processing with fees and rewards, i.e., mining, and make a nice profit at high volumes.

LOSERS: Smaller service providers. They cannot afford the now-required overhead because they don't have sufficient economies of scale.

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

#26

Post by Ajedi32 »

gruez wrote: post #7

discussed previously: https://news.ycombinator.com/item?id=28074809

Unless I'm misunderstanding something; I think this article is saying that the amendment being discussed in the post you linked failed to pass?

So I guess now we're back to the previous previous discussion where the EFF was decrying the bill as a privacy disaster: https://news.ycombinator.com/item?id=28045227

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

#27

Post by nightski »

verdverm wrote: post #21
dcolkitt wrote: post #17

Earlier quoted context omitted.

The response to 1929 wasn’t to functionally outlaw the existence of stocks.

This law does not functionally outlaw the existence of cryptocurrency, it clarifies requirements to operators that they cannot escape AML. I would expect a court to find that PoS is close enough to PoW as Congress intends this legislation, without digressing into the various types of PoS. While poorly written, it is likely that pure network operations will be ok long term.

Except it does. Because as written it includes miners in that group. Miners have no possible way of having the full identity of the parties involved in every transaction they verify and it would be impossible to comply with this reporting. That effectively outlaws it.

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

#28

Post by [deleted] »

dcolkitt wrote: post #16
meepmorp wrote: post #3

Earlier quoted context omitted.

No, and I hate that people shorten cryptocurrency to crypto.

The term “derivatives” is widely used for financial derivatives like options and swaps. It’s gained such widespread adoption that it by far dwarfs the original meaning of the instantaneous rate of change in calculus. I think the simpler answer is that when a word has two meanings, one a widely used category of financial instruments and the other a narrowly defined branch of advanced mathematics, the former will almos…

[deleted]

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

#29

Post by [deleted] »

vishakh82 wrote: post #4

If you think all cryptocurrencies are scams or think blockchains do nothing useful, please skip this comment. If you think things like decentralized finance, storage and identity have the potential to improve our lives and offer some of the only genuine alternatives to an increasingly privacy-hostile status quo, please look into the shambolic legislative process that threatens the entire blockchain industry in the Un…

[deleted]

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

#30

Post by verdverm »

nightski wrote: post #27
verdverm wrote: post #21

Earlier quoted context omitted.

This law does not functionally outlaw the existence of cryptocurrency, it clarifies requirements to operators that they cannot escape AML. I would expect a court to find that PoS is close enough to PoW as Congress intends this legislation, without digressing into the various types of PoS. While poorly written, it is likely that pure network operations will be ok long term.

Except it does. Because as written it includes miners in that group. Miners have no possible way of having the full identity of the parties involved in every transaction they verify and it would be impossible to comply with this reporting. That effectively outlaws it.

Did you read the amendment? It explicitly exempts miners, the devs, and pure wallets
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