51–60 of 65 posts
I get that this blog is one sided because it's literally from one of the sides, but not providing any details of the allegations seems sketchy, and makes me wonder what other important details he is omitting. Are we to assume that because this guy has a blog, he must not be guilty?
My understanding is that there are no clear allegations, that's the problem.
Earlier quoted context omitted.
Designing something that breaks the law, does not mean you don't have to enforce the law, or that the law needs to be updated and "made compatible" If I sold a car that was deliberately unsafe, I wouldn't expect people to come to my company's defense and say that being safe in my car isn't possible and therefor the law is outdated and not compatible with current technology.
Laws change as society and technology advances. If your argument is that every permissionless NFT sale is illegal and criminal because it cannot be KYC’d, my argument is that this law is dumb and needs to be rewritten given that many people and companies are now exploring NFTs as legal and taxed income, and most celebrities and companies selling NFTs in the last two years are not going through the same hardships as t…
Correct. The technology must be changed or you accept that you're evading the law.
Blockchain advocates have long claimed that blockchain would destroy the state. They never seem to have thought about what the state might do in response to threats to its power.
Earlier quoted context omitted.
As a business you have to issue invoices and you also have a responsibility to stop obviously criminal behavior. A car dealership can’t sell somebody a Lamborghini if they want to pay with crumpled $20 notes. An art dealer can’t buy a Mondrian that the seller claims they found in their granny’s attic. I don’t understand how this is controversial.
Neither of your examples seem obvious or objectively criminal, or uncontroversial for that matter. If you pull back from Lambo to a Civic, is this still obviously criminal? classifying suspicious transactions is a weird and dangerous path to legislate.
Domestically, cash above $10k is already subject to a reporting requirement, a new Honda Civic is $22k, and that much cash has been deemed suspicious due to the war on drugs.
Earlier quoted context omitted.
I am not saying KYC is not possible - I am saying the requirement that the seller does KYC - such as an invoice with customer details - on every transaction is not possible. Once an NFT is listed for sale through a permissionless contract, there is no way the seller can block a particular buyer, or demand an invoice or their private details before or after the sale. The buyer's tokens may have originated from a KYC-d…
What you are describing is the use of permissionless contracts to avoid AML/KYC compliance law, which is partly what the Directives are designed to criminalise. > I am not suggesting this exempts anybody from the law, I am suggesting the law is outdated and not compatible with current technology. AML 5 came into law on the 10th January 2020 (with an enforcement window for transposition into national laws). The law is…
The goal of this is not to avoid the KYC laws. Unfortunately the technology makes it impossible to comply with them as the laws do not account for permissionless smart contract functionality.
Many artists and corporations are now selling NFTs without the ability to get KYC on every transaction, because this data does not exist on the blockchain and cannot be acquired unless you are a legal authority that has the ability to request private data from a CEX. Saying it “must” be acquired for 10K+ transfers is basically saying those transfers must be criminalized.
NFT sales were not on anybody’s radar before 2021, especially not EU lawmakers. In the next few years it seems likely there will be more regulatory clarity so that people can make taxable income on NFTs without being treated as criminals as in the OP case.
> I think this really puts your bias front and centre.
How so? It is clear to me this law is not compatible with the way the blockchain works and the OP being criminalized for selling art is a good example of how it will hurt regular citizens. Meanwhile corporations and brands selling NFTs probably will be fine as they have larger legal teams and regulators are less likely to try and fight them.
The solution to this AML law is either to treat all these blockchain transactions as illegal and continue to criminalize the behaviour, as you are suggesting, or to define new laws that take into consideration the way that blockchain transactions do not allow sellers to request KYC, and instead push that AML reporting requirement on the CEXes.
I don’t believe him. It sounds to me like he played the usual scheme, having people pay for his NFTs to inflate their value- while sending the funds back.
It's not money laundering and I don't think it breaks any laws.
Earlier quoted context omitted.
Laws change as society and technology advances. If your argument is that every permissionless NFT sale is illegal and criminal because it cannot be KYC’d, my argument is that this law is dumb and needs to be rewritten given that many people and companies are now exploring NFTs as legal and taxed income, and most celebrities and companies selling NFTs in the last two years are not going through the same hardships as t…
> permissionless NFT sale is illegal and criminal because it cannot be KYC’d, Correct. The technology must be changed or you accept that you're evading the law. Blockchain advocates have long claimed that blockchain would destroy the state. They never seem to have thought about what the state might do in response to threats to its power.
Earlier quoted context omitted.
What you are describing is the use of permissionless contracts to avoid AML/KYC compliance law, which is partly what the Directives are designed to criminalise. > I am not suggesting this exempts anybody from the law, I am suggesting the law is outdated and not compatible with current technology. AML 5 came into law on the 10th January 2020 (with an enforcement window for transposition into national laws). The law is…
> What you are describing is the use of permissionless contracts to avoid AML/KYC compliance law, which is partly what the Directives are designed to criminalise. The goal of this is not to avoid the KYC laws. Unfortunately the technology makes it impossible to comply with them as the laws do not account for permissionless smart contract functionality. Many artists and corporations are now selling NFTs without the ab…
If so, you are delusional. Lawmakers are not going to carve out an exemption for blockchain transactions when the explicit goal of the EU is to bring them under robust regulation.
Once again, the outcome that is upsetting you is the intended goal of the Directives. If in doubt, Google “AML5 crypto”. After all, it is the Directive that brought crypto exchanges under AML rules and almost certainly is the reason that the OP (irrespective of whether they broke any rules) came under investigation.
Finally, I believe your own biases hide from you how similar this legislation is when applied to fiat, barter, and crypto transactions.
In the EU, you cannot lawfully undertake high-value transactions without KYC. Whether you agree with that or not (and I don’t), it is the law of the land, widely accepted and implemented, and not unpopular. Sort of a legislative change of tack, regulation will continue in this vein.
Earlier quoted context omitted.
Laws change as society and technology advances. If your argument is that every permissionless NFT sale is illegal and criminal because it cannot be KYC’d, my argument is that this law is dumb and needs to be rewritten given that many people and companies are now exploring NFTs as legal and taxed income, and most celebrities and companies selling NFTs in the last two years are not going through the same hardships as t…
You have the chain of causation backwards. The law was rewritten, partly because: > many people and companies are now exploring NFTs as legal and taxed income, and most celebrities and companies selling NFTs in the last two years are not going through the same hardships as the OP. Which is, of course, a breeding ground for money laundering if exempt from KYC/AML regulation.
Eventually a democratic society decides on its laws. If the citizens and taxpayers want to buy and sell NFTs on permissionless blockchains like Ethereum without being treated as criminals, the laws will have to change.
Earlier quoted context omitted.
> What you are describing is the use of permissionless contracts to avoid AML/KYC compliance law, which is partly what the Directives are designed to criminalise. The goal of this is not to avoid the KYC laws. Unfortunately the technology makes it impossible to comply with them as the laws do not account for permissionless smart contract functionality. Many artists and corporations are now selling NFTs without the ab…
Your argument seems to rest on the idea that regulating high-value transactions on a blockchain is an unintended side-effect of AML5 (and the upcoming strengthened AML6). If so, you are delusional. Lawmakers are not going to carve out an exemption for blockchain transactions when the explicit goal of the EU is to bring them under robust regulation. Once again, the outcome that is upsetting you is the intended goal of…
Earlier quoted context omitted.
You have the chain of causation backwards. The law was rewritten, partly because: > many people and companies are now exploring NFTs as legal and taxed income, and most celebrities and companies selling NFTs in the last two years are not going through the same hardships as the OP. Which is, of course, a breeding ground for money laundering if exempt from KYC/AML regulation.
Does this law target NFTs? Eventually a democratic society decides on its laws. If the citizens and taxpayers want to buy and sell NFTs on permissionless blockchains like Ethereum without being treated as criminals, the laws will have to change.
Globally, the trend is towards stricter and more comprehensive regulation of blockchain-based transactions. While you may prefer (as may I) a freer regulatory environment, the pendulum is swinging in the opposite direction.