Bitcoin Freedom

Prepare For SB1241’s Pit Bull Assault on Bitcoin Freedom

Senate Bill 1241 defines digital currencies as “monetary instruments” and digital exchanges/tumblers as “financial institutions” for purposes of enforcing anti-money laundering laws. If successful, the “Combating Money Laundering, Terrorist Financing and Counterfeiting Act” would inflict unhappy consequences on bitcoin freedom. [Note: for a section-by-section analysis of the bill, please click here. Section 13 deals directly with cryptocurrencies. The other sections become relevant only because 13 makes bitcoin fall under their purview.]

Also read: European Commission Launches Digital Currency and Dark Web Consortium

SB1241 would have another impact that is less obvious but Prepare For SB1241's Pit Bull Assault on Bitcoin Freedomequally sweeping. Federal law is centralized law; that is, the same regulation is imposed equally on all states. Of course, the ideal is no regulation at all except for the community standards of businesses and users. But if bitcoin is to be regulated, then a patchwork of incompatible or differing laws is far more favorable to freedom than homogeneity. A network of decentralized authorities (states) may not constitute liberty but it does offer alternatives and escapes for those who seek greater freedom.

The Obvious Unhappy Consequences

Section 13 of SB1241 is entitled “Prepaid Access Devices, Stored Value Cards, Digital Currencies, and Other Similar Instruments.” This would amend Section 5316 of Title 31 in two significant ways.

First, 5316 currently states: “(2) ‘financial institution’ means—…(B) a commercial bank or trust company.” This would be amended to insert “or any digital exchange or tumbler of digital currency.” The news site Coindesk observes, “the bill clarifies that any ‘issuer, redeemer or cashier’ of a ‘digital currency’ is also covered.”

Second, a summary of the bill provided by co-sponsor Senator Chuck Grassley (R-IA) states,

Funds stored in a digital format” would be included “within the definition of monetary instruments” making them subject to “anti-money laundering reporting requirements…where the value stored is above $10,000.

In other words, digital exchanges would become the equivalent of banks.

Parallel Institutions, The Less Obvious Unhappy Consequence

Here, “institution” refers to a society or an organization. A “parallel institution” refers to a society or organization that acts as a counterbalance or competing authority to another organization, such as the federal government.

Parallel institutions have always benefited freedom-seekers, especially religious and political refugees. In the Middle Ages, Protestant dissenters fled Anglican England to find refuge in the Netherlands. Puritans colonized the New World and served as a beacon to others who sought religious liberty. The power of parallel institutions is captured by the principle of “sanctuary” by which a Church exercises a higher authority than the State and can refuse to surrender ‘criminals’ who seek refuge within its walls.

The political version of sanctuary plays out every day. People cross the border of one nation and escape into another. The second nation is not necessarily freer than the first but some aspect of it is freer to the refugee. Russia may not be freer than America, for example, but to Edward Snowden it is. The Ecuadorian embassy in London may be obscenely confining but it is more expansive than a prison cell to Julian Assange.

Parallel institutions also play an important Prepare For SB1241's Pit Bull Assault on Bitcoin Freedompractical role in the bitcoin community which is highly fluid and transplantable. In June 2015, a harsh licensing requirement for crypto businesses became law In New York with enforcement to begin in August. Many businesses chose to leave rather than abide by a license that required, among other things, the divulgence and sharing of customer data. Fortune magazine noted, “Last weekend the deadline to apply for a BitLicense came and went, and a slew of bitcoin startups went too—right out of New York State… This is not a comprehensive list, but here are some of the companies that packed up and left New York: Bitfinex, Bitquick, BTCGuild, Eobot, Genesis Mining, Gocoin, Kraken, Localbitcoins, Paxful, and Poloniex.”  Those who physically left did so by relocating to parallel institutions – that is, to other states with more palatable environments.

The power of parallel institutions is also seen through what happens when the two merge their interests and become, in effect, one institution. Instead of offsetting each other’s power, they buttress and increase it at the expense of individual freedom.

When church and state speak with one voice, both become more oppressive; it was precisely because the Anglican Church was the state church of England that religious dissenters felt impelled to flee. In extreme cases, the melding of church and government can lead to an Inquisition. When capitalism and government blend their interests, the results are no less devastating. Crony capitalism is established; government and favored businesses grant each other privileges by which both grow rich by picking the pockets of average people. This bastardization of the free market is an efficient engine of oppression.

S1241 is the federal government’s attempt to merge its power with that of the states and to homogenize that power under laws it enforces. There would be “one law to rule them all, one law to find them, one law to bring them all and in the darkness bind them.”

Moving from state to state to escape a specific regulation is a relatively trivial task. Under SB1241 and the follow-on legislation it would inspire, physical bitcoin businesses would need to move internationally or shut down.

Conclusion

SB1241 was referred to the Senate Judiciary Committee on May 25. This is the preliminary step before a bill can be introduced into the House or Senate for debate and, perhaps, a vote. In short, S1241 is in the earliest stage of legislation, and many bills never make it out of committee. If it does move forward, then the bill’s sweeping scope may be a barrier to passage in either the House or the Senate. On the other hand, the draft bill may deliberately express overreach in order to provide room for negotiation and compromise. And another terrorist attack on U.S. soil could create a political hysteria that the bill could ride into becoming law.

One thing is clear: S1241 is what some—and Prepare For SB1241's Pit Bull Assault on Bitcoin Freedomprobably many—politicians want to impose on monetary instruments, including bitcoin, and financial institutions, including digital currency exchanges.

A last point: S1241 mandates a report from Department of Homeland Security which is due 18 months after the bill’s passage. DHS is asked to detail “a strategy to detect prepaid access devices and digital currency at border crossings and ports of entry”. Travelling in and out of the U.S. with bitcoin could become a real problem. Currency control at the border is an indication of a government that is becoming or has become a totalitarian state.

S1241 is a dot on the legal horizon. Whether or not it passes, this is the direction the state is pushing and will continue to push cyptocurrencies. Prepare now.

What do you think bitcoin and other digital currencies will harmed SB1241? Do you believe there are ways to mitigate the damage? Let us know in the comments below. 


Images via Shutterstock 


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  • Liberty88

    Money laundering, terrorist financing, & counterfeiting….. all things that the Federal Reserve does very well in conjunction with John McCain and the Deep State operatives – this is a big pile of crap.

    The Federal Reserve creates money out of nothing and allows the government to finance Isis operations through the CIA and print counterfeit currency to inflate foreign reserves to destabilize other countries in favor of the dollar…. talk about the pot calling the kettle black.

    • concerndcitizen

      Yes, but, but, when the Fed does it it’s *legal*. /sarc

    • Reid Harrison

      They don’t like competition. Just like the war on drugs

  • milmacrs

    The good thing is that governments can only put their have paw on Bitcoin when it touches fiat at exchanges. This SB is a strong push towards a Bitcoin-only economy

    • Agreed. Exchanges are becoming risky for a number of reasons, primarily the one you mention. I think there is going to be real innovation in the crypto-community in the areas of trading and redeeming as a response to measures like SB1241 and to recent crackdowns.

      • Khursh Mian-Acevedo

        Any info on that lawsuit? If available. Thanks.

        • There’s more than one. But here’s this is the one re: the Cryptsy matter: https://news.bitcoin.com/class-action-cryptsy-coinbase/. The one to which I was referring, however, was being organized on reddit and the page has been banned from the site. I would have never known it you hadn’t asked because the page was there a week ago. It is a fast-moving world.

    • This isn’t exactly true. There are forensic tools to track the physical location of bitcoin. It’s not an anonymous coin. If they want to put the resources into it, they’ll find a way to track it.

      • milmacrs

        I know, but it’s very hard to track and and the the battleground will be technological, not political or judiciary

        • True, but the resources to wage that technical battle are allocated through politics.
          For example when they say bitcoin is used to fund terrorism, they are more likely to get funding and support to design a tracking system. Although DHS or the military may already be working on it, that’s what I’d be doing if I were them. The Senate may just be getting a clue but I’m sure other parts of government aren’t quite so slow.

          But with other coins that are more designed around privacy, I think it will be harder. I just know bitcoin isn’t completely technologically private. I’m not sure about Monero and Dash and other coins. But yes, it’s going to be a battle alright.

          • William Wanklyn

            Agree on the privacy issues.

      • William Wanklyn

        Bitcoin is not “physically located” anywhere. A record of it is located on the blockchain, which is a distributed database, all round the world. Their may be nodes in the US, but if they are taken down by some US regulation, it will not affect the rest of the network, nor the bitcoin referred to.

  • How exactly is one meant to “prepare”?

    • Frank Zeleniuk

      That would be my question.

      • Sorry, Frank, but I can’t give people specific financial advice but Mike Myers comments (see above) sound like a good direction in which to do research. Some of the strategies used by those who secure their holdings in precious metals are probably translatable to bitcoin.

        • undeRGRound

          Absolutely, Wendy!
          SDIRA is a self-held, Precious Metals IRA program that is fully approved.
          One can do a roll over from a 401K (or 401A, with proper approval of the fund)
          and purchase a safe for home storage. Security is up to YOU, but still much
          better than a normal financial institution. Meaning BANK lol

    • Emma, everyone will make plans based on their personal circumstances but there are some common sense precautions. For example, I would be nervous about having my holdings in an exchange because they are being defined as quasi-banks and they are almost certain to comply with any government policy or law without regard to the well-being of their customers. Another example, acquire bitcoin or other cryptocurrencies in a manner that leaves little or no trail. But as I said, each person should prepare (or not) depending on their circumstances.

      • That implies I want to hide my activities from the government. I don’t. The government already knows I use bitcoin because I pay taxes on it. I’m happy to pay taxes because I want to live in a world where people with less privilege are taken care of. Maybe you could encourage people to educate their elected officials and propose sensible legislation.

        • I wasn’t implying anything, Emma, other than demonstrating a strong bias for privacy. I do not encourage people to educate their elected officials — tho’ it is none of my business if they choose to do so — because I do not think it is ignorance that drives bills like S1241 or other highly intrusive legislation. But, if you believe in that strategy, then it makes sense that you would pursue it.

          • Well, if you follow the law you would be reporting any bitcoin profit already so the government would already know. So to advocate secrecy at this stage seems like an implication of tax evasion. Since there is no point in not using an exchange b/c they might tell the government because you are obligated to tell the government anyway, at least whenever you sell or use the bitcoin for anything.

            But anyway, yes I think ignorance drives everything. I don’t believe in evil — I believe everyone is motivated to try to do what they think is the right thing to do, even when people commit violence or violate others rights, it’s because they believe that is somehow bettering the world, or bettering their family or group. Therefore it is a tragic misunderstanding of how we could live in harmony. Education is not something that will guarantee political victory, but it is the only long-term means of cultural and societal progress.

          • There is a marked difference between secrecy and privacy, Emma, but I am familiar with the argument that if a person’s business and life are not conducted in the street, then they must have something shameful to hide. We’re just going to disagree on this one.

            I said nothing about “evil” in terms of governmental motives. I merely stated that I believe the reach for political power is based on factors other than ignorance. You seem determined to argue points that I’m not making, which means it is time to disengage. I gave discussion a fair try.

          • Relax, I’m not trying to argue with you. I think you are reading some moral judgement and argumentative tone into what I’m saying which isn’t there. I wasn’t saying privacy was wrong, just that we don’t have it anyway, legally. In my reading, this bill essentially adds enforcement capabilities to what was already the law. I’d be happy to be informed if I’m missing something. But if we already have to report our bitcoin income to be in compliance with the tax law, then what difference does it make if the exchanges give them the same information we are already giving them? It’s like your employer having to report your income, but even if they didn’t, you’d have to report it anyway.

            The thing about evil was a moral philosophy argument, I think it was just not really relevant to this conversation, and I forget people take the word “evil” as a judgement. I just mean “innate desire to do wrong” as a theory of motivation, which I don’t believe in. But I am curious, because this topic interests me, what you think a third foundational motivation is for humans besides ignorance or innate badness (evil).

            Personally I primarily follow the law, not because I believe in it, but because I do not want to be punished. But secondarily, I also strongly value social welfare and I’m unsure how else to accomplish that but through mandatory taxes. I don’t know how a country could have taxes at all if they had no way of enforcing it. Taxes would become entirely voluntary. Perhaps that is where we are going. I am torn because I support decentralization, but I also support social welfare and I don’t yet trust (because I have no evidence for it), that social welfare would happen if it were not mandated. But it does look like a question we will have the opportunity to answer in the coming decades. It looks inevitable that as money becomes more technologically capable of privacy, that more people will not report it and less tax will be paid.

          • jandr0

            [But secondarily, I also strongly value social welfare and I’m unsure how else to accomplish that but through mandatory taxes.]

            Social welfare should be accomplished – in our individual capacities – by those people, like you (and potentially I) who “strongly value social welfare.”

            And NOT by dictating via government your (potentially our) “strong values” on other people by forcing them to pay for values you (or we) hold – for example by forcing others via mandatory taxes because we “feel it is right.”

            What exactly gives you (or us) the right to dictate to other people how their resources should be allocated (maybe they would rather spend their money on their children, parents, struggling friends, a charity whose goals they support, or whetever makes THEM happy).

          • Well said.

          • undeRGRound

            I guess you do not realize that the IRS is unconstitutional…
            Maybe the correct term would be “extra-constitutional”.

            I, however, play it straight up also. I have not removed anything from the system. It is a retirement plan for me. I plan to remove profits to an SDIRA. Minus 1 misstep I have made out very well and soon I should have exceeded my prior “Plan B” which has also done well.
            You seem to be well informed, Emma, and I look forward to your comments.

          • Well…anyone can say “XYZ is unconstitutional” and construct an argument for it, but in this country the Supreme Court has the final say in what is or isn’t constitutional. And they don’t have a problem with the IRS or taxes so I find the argument kind of pointless.

          • Segue

            One of the most important things I have learned in my life, is that the village judge will be biased to rule in favor of the village powers-that-be. After all, it is the powers-that-be who bestowed the powers that the judge exercises in the first place. Justice systems are never unbiased. The IRS was created in cooperation with the powers-that-be, i.e. the bankers. A judge could never rule such an institution unconstitutional without risking his career. the stakes are just too high.

          • Supreme Court justices are not “village judges”. They are appointed for life, precisely to avoid conflicts of interest. They do not get their powers from “powers that be”, whoever those are, but from the constitution (Article 3). Federal income tax was first instituted to pay for the Civil War, it had nothing to do with banks.

            Our financial systems have serious problems and systemic injustice, but vague conspiracies do not help the situation, they just make critiques easy to dismiss.

          • undeRGRound

            Is there a decision that you know of that I could look at?

  • Tread Million

    I do get confused when I see your “Canadian” articles. Maybe say “USA Writer/Reporter” instead?

    • I don’t quite understand, Tread Million. The article is clearly about a bill in the U.S. Senate and writers who publish here (bitcoin) resident in many different places. I can’t say “USA Writer,” BTW, because I’m not. Sorry for any confusion.

  • If a tyrannical beast can hurt bitcoin then there is a need for something better. I fear for individuals and companies who become collateral damage, but at least we will all learn the limitations of a government whose power is derived by the perception of its people and how much theft they allow.

  • Frank Zeleniuk

    So…the central bankers are getting nervous about some competition! Bitcoin is officially on the radar.

  • Mahesa Suprobo

    Everyone needs to contact their senators and ask them to vote “no” to SB1241.

    • drowninbleach

      Also, ask them to put a noose around their necks and dangle. Especially Feinstien.

    • Peter Like

      But do they have enough funds to “ask” them to say no?

  • twilborn

    This will create more demand for decentralized exchanges and human ATM networks that are free from all that bullying.
    I hope that decentralized crypto trading technology will soon make all these annoying laws irrelevant.

    • A decentralized trading app is way overdue. A reader who commented on my bitcoin.com article about the criminalization of Localbitcoins said he was working on one. My fingers are crossed.

      • why bother

        Wendy, I need to follow through on this but some apps seem to do this now. They are open source also. I have Mycelium on my Droid and I need to inspect the source code. I am curious how they spend without having a node. If this is what I expect – there is no way anyone can interfere with a transaction and trace it to you. The wallet public address is recorded on the blockchain but that is the only information

  • Mike Myers

    hedge your cryptos in offshore vaults and exchanges based outside usa easy sidestep and economic loss in usa economy when this passes in law

  • Mike Myers

    its same tatic used by millionaires who hide thier money offshore to sidestep taxes

  • Sinsyn Taxx

    thats shid bolitic. usa controls o much and made to much bullshit. all nations should left this decisions behind and left usa on side, fuk it. even russia wants to bush etherium. why should th us laws be from the whole world? what they wanna do, bomb the whole world with terrorist atacks by the cia and stubid fanatics? that shid must stob. we have now found everyone a legal method to leave banks behind, and i was telling one month ago, the only thing usa and banks can do, is make terrorist atacks to manibulate theyr laws, thats bredictiable this mfukas. fak it, even russia want make etherium legal. so lets go in that direction…. greez to the volkz

  • Daniel Stan

    When is the vote goin to take place?

    • Good evening, Daniel. As I mentioned in the conclusion, the bill is in its earliest stage — that is, it is in committee. If you click on the govtract link within the article, you can track the progress of the bill. There is time to write to Senators and Congressmen, if you think that’s an effective strategy. I’ve always been a bit skeptical of that path, myself.

  • bill

    an attack on bitcoin might fire up the gold market

    • undeRGRound

      I was going to say, SILVER and Gold are “something better” 😉

    • why bother

      Point well taken. By the way, I don’t remember if it was nationwide or in California but the snoops were trying to make coin shops 1099 any exchange of at least $100 or more a few years back. The bill was struck down. They 1099 you for transactions of at lest $10,000. So right now people can walk into a coin shop and buy or sell $6,000 USD in gold bullion with no ID. That is far more financial privacy than buying through a BTM machine. In fact, it is anonymous.

      • Frank Zeleniuk

        Anonymous? Not if you put it on your credit or debit card. Fiat currency cash won’t be around long either but that would be anonymous.

        • why bother

          i brought precious metals for well over a decade. There is no way I would ever want to buy with a credit card or debit card. If they ban cash and go with FedCoin it’s too late. I will just trade between Bitcoin and precious metals with no centralized exchange. It is possible and I can do it in person.

  • Socalcat

    BITCOIN.COM Would be great if you wrote a follow up or amended this article to let us know how we can help stop this, and how we can reach our friends via social media or otherwise to get a movement going. This bill either needs to be shut down entirely or amended to remove the main points you covered here.. I believe it would really help to give us some very clear and easy instructions on what to do to help.

  • Ben

    My First step – i will sell the btc’s – seems the value Will go down as before!!

    • reformist

      or invest your BTC to mining firms and by the time it goes up again you’ve grown you mining pools and there you go… you’ll have more BTC than your peers.

    • why bother

      I am holding. I bought my Bitcoin low.

  • William Wanklyn

    How does a distributed exchange like Bitshares fit into this picture. It is not resident anywhere. As far as border crossings go, do not have a ton of crypto on your phone wallet. Hardware wallets like Trezor may cause them to go apeshit, but they cant see what’s in it so what are they going to do? Torture? Waterboarding? Your private keys or else?
    The fight is on. Be brave. Be bold.

    • Good evening, William. I don’t know how a distributed exchange like Bitshares would be treated but I expect any instance of it — or of its activity — on American soil would be treated as an exchange in and of itself. Individuals on Localbitcoins are being prosecuted for money laundering because they traded without a state license. This means the authorities are becoming expansive in how they define money laundering and who they target.

      As for how they can see the contents of your Trezor wallet…there have been precedents recently of people being detained or otherwise abused by TSA if they refuse to hand over passwords. At bare minimum, they can refuse you entry or exit. See https://psmag.com/news/what-customs-and-border-officials-can-and-cant-do. There is no court precedent for refusing to reveal a password to the TSA or a customs official but, in another proceeding, a man who refused to reveal the password for his smartphone was found to be “in contempt of court” — an jailable offense. https://www.theregister.co.uk/2017/03/20/appeals_court_contempt_passwords/

      • With Trezor you can create as many wallets as you want with different passcodes, so you could give them a passcode for a wallet without much in it or empty, and they wouldn’t know there were any other wallets on the device. It was designed for this scenario.

  • Good evening. I am bit late to the party but I will be checking in tonight and tomorrow to answer questions and chat.

  • undeRGRound

    Well, I guess the other shoe dropped… I just found out yesterday that Etherium is IRS approved for 401k and IRA accounts. Then this today 🙁

    dirty sum-buck scumbag poly-ticks grrrr….

    Great Article, Wendy!
    Glad to meet you, hope to read more of your work!

    • Hey there, undeRGRound. Great moniker! And nice to meet you, too. I write a regular column here so, if you visit, we’ll probably bump into each other. The news can be discouraging, I know, but I have real confidence in the innovation and abilities of the “Powers That Be” to solve these problems. For one thing, the bitcoin PTB rose on merit and not on backroom deals, political muscle or…well, you know the list as well I do, I think.

  • Tatchapan R

    Thanks for article. Bitcoin is decentralized digital currency and needs no a central repository or any person or any organization. Besides workers are always do their job 24/7 to make the system continue forever. This is true that government try to do something about money laundering for long time ago but they will never achieve because of the core of the designed we trusted.

  • Chang-gul Jeon

    Do you think it is a matter for the United States to decide on its own? In the globalization of electronic money,
    Can be isolated. Do not treat people who trade electronic money as criminals. It is an old-fashioned idea and dangerous control.

    • It is not something the U.S. should (or can) decide on its own for the entire world nor a matter it should decide even for its own citizens. It is a state-grab for power and wealth at the expense of individual freedom. Fortunately, many other places around the globe are more reasonable and welcoming to financial freedom. The U.S. is likely to fall behind in this area…and it should fall behind if its focus is control rather than laissez-faire. Thanks for the question.

  • luka ermenc

    Whatever america. Are you aware you are legalising bitcoin and preparing for massive adoption. This will skyrocket its price. While you are taxing your citizens for bitcoin, rest of the world will be dancing on your grave.

    • I agree that this legislation, if passed, would most benefit foreign holders of bitcoin who would see the price rise without incurring any legal disadvantages. But, as a non-American, I always make sure to distinguish the American people from their government. The schism between the two is widening on a daily basis. I would not mind dancing in a red dress on the grave of government but on the graves of the people…no. Thanks for the post. It is important for Americans to know how they are being viewed by the rest of the world. But, again, the American people are decent, hardworking folks who are badly represented by government…in both senses of the word “represented.”

  • Vikrant Chib

    It should be brought under control if even a part of it is being used for money laundering, drugs, etc.
    And it’s not about individual freedom as this article is trying to portray. Bitcoin gains it’s power from a community of miners and isn’t an individual thing.

    • drowninbleach

      Central banks with inflationary/deflationary, taxation, and regulatory powers are infinitely different from miners. I’ll take a few greedy miners driving prices up over big brother any day.

  • why bother

    I said this in essence here before. Decentralized personal finance and currency with no government access is my big interest. I have worked in cryptography software for over sixteen years. But I became obsessed with the personal privacy issues in 2013. I am a few years from retirement and by golly I vow to do as much as I can to bring decentralization apps onto smartphones- at least Droids. It’s all going to be open source so that it will be open to scrutiny and will essentially be able to send and receive Bitcoin. Forget shapeshift for now. I want to start it simple. It might require you to have your own personal node on your home pc but involve TLS connection over VPN between your smartphone and your personal node. I don’t know yet. But I will do my damndest to fight the snoops. I even have a code phrase for the work I will do after retirement but I cannot say it yet.

    • I share your obsession but not your semantics. To me, it seems like common sense for anyone who values their freedom. The two concepts are so intimately interconnected in my mind that I use “privacy” and “freedom” almost as synonyms…even though I am well aware of their differences. And I want to acquire a copy of your app as soon as it is available! Much needed.

      • why bother

        Oh I am certainly a voluntaryist. Very certainly

    • William Wanklyn

      Thanks for the efforts Why, I share your sympathies. I have been toying with the idea of double dipping on the energy needed to mine crypto, using heat transfer methods for home heating and cooling while mining at the same time. At first, I was hesitant to put out the ideas for fear of losing out on a patentable idea. Fuck it. It is far more important to share than to gain personally.

      • why bother

        I made enough money in stocks and I regard my net worth as what I will live off of while giving away hopefully very useful technology to liberate us from central planners. Yes I hope to “give back” this way because I value decentralization

  • why bother

    Note that this will drive people to Bitcoin meetups to trade Bitcoin for cash in person. Some people have been doing exactly that. Others are well known in the Bitcoin community and travel all over the world so they know a lot of people to trade Bitcoin. Maybe this will drive us out of our dark cellars into the streets to trade Bitcoin and become social!

    • That would be a happy result. You should be aware, however, that there seems to be a push to criminalize some aspects of LocalBitcoins, which I believe is an attempt to crack down on peer-to-peer transfers that avoid the privacy-stripping aspect of exchanges. Most of all, people have to be a bit more careful out there. If you are interested, my article last week was on that subject. https://news.bitcoin.com/the-slow-criminalization-of-peer-to-peer-transfers/

      • why bother

        One does not need LocalBitcoin to trade Bitcoin for cash. Meet ups are advertised on the web. They tend to have half hour presentation by an organizer or guest speaker and then a discussion and opportunities to socialize and meet people. You can exchange phone numbers and can establish trading relationships that way. You don’t have to buy and sell at a meetup. Just get to know people. And trade in private at other times. All one needs is cash and another needs a QR code. Like on a paper wallet. There is no way that is going to be stopped.

        • William Wanklyn

          As you know, there is also a move against cash. Once the ability to freely transfer value between people disappears, transfers to and from fiat will stop. Then there will be two worlds, the crypto world where everything happens in crypto and the fiat world. While taxes have to be paid in fiat, we will need a way to get fiat, otherwise all this is driving free people into the underworld.

          • William Wanklyn

            Possibly crypto to gold to fiat and back will become the new pathway.

          • why bother

            I’ve been a long time fiat / gold trader, and I’ve quickly caught on to the fiat / Bitcoin / gold thing. I think at least in San Francisco you can walk in at a particular coin shop and buy gold directly with Bitcoin/ I have not confirmed this nor do I confirm whether it does KYC. But I am prepared to trade Bitcoin for gold and vice versa if my technology I have in mind is not available when I need it. I laugh at gold bugs who belittle Bitcoin and I laugh at cryptocurrency fanatics who hate precious metals. Bitcoin is Satoshi’s gift to us who accumulate safe haven assets

  • drowninbleach

    It’s ironic how blatant the “Land of the Free” has become in its attempts to create an Orwellian society. Imagine the beaurocracy which would be required to enforce crypto-prohibition.

  • Fritz Knese

    I fear that Bitcoin is doomed. Those of you who think that high tech is favoring the individual’s freedom are naïve. High tech is bought by big money. Government has essentially unlimited funds to buy the best hackers. Avoiding regulation used to be the best way towards freedom. But advancing tech has made that avoidance virtually impossible. It is pretty much to the point of direct resistance or submission. One can’t dance between the raindrops in a deluge.

  • HK Rearden

    On June 2, 2017 the governor of NH signed a bill (HB436) which protects cryptocurrencies from regulation in NH.

  • sandwich

    Well the DHS and IRS need to find some middle ground, because if cryptocurrency is a “Monetary Instrument” and not “Property” then I’m not sending the IRS shit. You can’t have it both ways, G-man.

  • UnklAdM

    Blockchain technologies are simply global robotic money. The banks should be scared. Any technology that threatens the banks and insurance companies is going to be resisted. And I believe the robots will win just as in Detroit. This has absolutely nothing to do with terrorism. In my opinion there is a hidden agenda here.

  • kashif

    i think declaring digital currency as monetary assets will open the doors for digital currency into real economy… if its a monetary asset the it must be acceptable as a payment for your bills or purchase of property etc putting exchanges into money laundring scope will increase govt ovesight and protect the investors … i font know why digital community is so afraid.. i think this will boost dihital coins value a lot!!

  • Very good article but do not the mistake to confuse the US with the world. Many do understand the liberation of an economy of endebtness so may take it another while in the US. And if you look a bit closer you remember well that blockchain runs on the entire globe and decentralized by itself, if the US market getting nasty as expected you have to chose from the unsignificant rest of the world population (94%) in order to proceed with wallet, accounts, liberty, discretion elsewhere. I was thinking to suggest a global government to the blockchain family and outside of any monetarian and value industry established so far. The functionality comes first. I am mentioning this because the point is not the producer of an application and a user or buyer (Bitcoin : Me) but the backbone to this and the so many other applications! A government or legal residence of the blockchain family would be as much decentralized from the inside like the decentralized app developments it did, does and will further on initiate in matters of an ever growing complex human world.

  • It well may be possible the first large commodity deals of governments will be made in crypto currency by Russia and China! The entire idea of the BRICS comes to fresh live.

  • Burstcoin for the win!

  • sjs

    What is the interpretation of funds stored over $10,000? Per storage device either h/ware or s/ware wallet or per person/owner?

  • disqus_p05h4KCIG2

    Developing of alernate crypto is a key – multipurpose and secure. F*ck those govs which only stinks.