Bitcoin Forum

Are you in favor to register your BTC Wallet address to trace transactions and impose taxed it?  It is a big subject now amongst lawmakers to trace down income and transaction about bitcoins.   This has become the talk of the people involved in digital currency lately.  So, What do you think????

I don't think that there are any wallets that use a single address (except for paper wallets). People would have to register a new address every time they receive bitcoins, so I don't think it will ever happen.

I don't think that would work. Remember first of all most people have multiple Bitcoin addresses.And that address changes every time you make a transaction. If we all had one address, that would work maybe.how would they police that? That would be impossibleto police.

It simply won't work with the way Bitcoin is currently set up. It's better for you and people you transact with if you don't reuse addresses. It would also make all of your transactions very public, so anyone and everyone can take a peek at your finances. It's going to create more problems than solutions, and if governments start requiring this, I'll probably stop using Bitcoin. If we're only trying to solve the taxation problem, then I think it's still much better to just tax transactions through vendors and exchanges. Your Bitcoins are inevitably going to end up there one way or another anyway.

What kind of absurd idea is this? Bitcoin address is not and should not be tied to any names. That's how it was design and giving up your privileges for being pseudo-anonymous will not be good for you. Those proponent of this doesn't know a single thing about bitcoin. Actually this has been used by a lot of trading platforms, asking your data for KYC/AML compliant. That is if you are going to exchange your bitcoin to fiat. However, if you kept it in a wallet like Core or Electrum there should be name association. And this will not gain traction from the community. This is a bad idea to begin with.

No, I am not in favor of the decision, We joined the bitcoin because it is anonymous and we can use it the way community(We) like if the government are looking to get it under taxes and trace the transaction to catch people than I'm sorry, what will be the benefit of using a cryptocurrency, I want it anonymous.

Bitcoins are made so that our transactions are easy and will not go through much of the process. The bitcoins do not control it is decentralized. And if each of us has a look at our every action. Bitcoins are no longer decentralized if that happens.

I am in no way in favor of that decision. Bitcoin was meant to stand for the complete opposite, I'm kind of frustrated with the way bitcoin is becoming more mainstream now adays, it only draws attention. Good and bad.

That is really the opposite of how bitcoin should work, it should somewhat be anonymous, But if governments would impose this I think we can't do anything about it.

We are still on a world where it is being regulated by governments.

What's this register your BTC address talk? How do you do that? Who's asking you to do that? Nobody.

Pay taxes? Yes! Of course! You gotta follow the laws, man. Plus if we don't follow the laws (like many people using fiat who avoid taxes do), they won't blame the person they'll blame Bitcoin. As if Bitcoin is the reason why a person decided not to pay his or her taxes.

They can't realistically tax it until you turn it into fiat. In order to do that (in the US at least), you have to run it through your bank, and they'll happily give you up to the IRS. May as well claim it before they track you down. Either that or don't turn it into fiat until you've made so much it won't hurt you. Capital gains is not much on a long-term investment.

i don't have any issues with paying taxes, maybe because they are not that high or a problem where i live, so i don't see any issue with me paying taxes on bitcoin profits too.

but first bitcoin needs to be regulated and adopted first.

I would be in favour of a voluntary declaration of a Bitcoin address, to be able to prove that some Bitcoin transactions really happened.

Above all if you are a business or a charitable organization and operate legally with Bitcoin payments, if the sums you "move" are pretty large (or frequent) the tax office could suspect you to hide information. If you had a "declared" Bitcoin address which you could use for large transactions (e.g. your cold wallet), then it would be easier for you to prove the real transactions that happened.

But that should only be strictly voluntary. A mandatory declaration would not only be opposed by me (and probably most other Bitcoiners) but also would be very hard (=almost impossible) to enforce.

Obviously not in favour of it. But anyways its almost impossible to happen, because very easily one can setup a new wallet and mix his bitcoin via an bitcoin mixer and just like that the the government would has lost track of those bitcoin. The whole point of blockchain was to be decentralized, so obviously it's going to impossible to impose tax in bitcoin.

WHAT?!?! This goes against everything bitcoin stands for! You should just use fiat. Bitcoin isn't for you.

All that said, if you're using an exchange you don't really own a bitcoin address, you lease one. And the exchange owns it. But the government should trust that you're going to declare taxes and if they find out you aren't paying you should get penalized.

If this one is going to keep me away from being accussed as a tax evaders, why not? I'm not gonna gamble my life just to avoid taxes and keeping few percents of my earning.
It's always better to keep secure and obey any government's rules if you want a peaceful life, so I'm in favor to register my address to the department of taxation.

Why? Blockchains are there to prove someone sent you money.

If you get an advantage proving against the State that someone (e.g. a legitimate business) sent you money and NOT another one (e.g. a scammer/hacker/money launderer) then I see nothing bad if the state gives you that opportunity. If this opportunity does not exist, the state could simply suppose you've received "not legit" money and order a raid. Would that be better?

I've never mentioned an exchange. What has to do that with the topic of this thread?
Completely right, but that is not my point, see above. I wrote about a strictly voluntary possibility.

Agree with d5 partially. Im down for a voluntary submission, not a mandatory submission. I understand that this is money, and that given some of the constructs that exist in our society, it is wise from a societal good standpoint to monitor the movement of large amounts of money. In that spirit, I would even be down for a mandatory reporting requirement on x funds (this is pretty much the case as it is, most of us simply ignore this because it is rather hard to enforce with crypto). But I would rather comply than have my shit kicked in by the Feds. Essentially, people, you are at the mercy of your government. If they say a thing is not so, it no longer is. If that is a hard pill to swallow, moving should be a consideration ;)

and no, its not fair.

In the first place we are all well if not all most of us doesng want to be taxed accordingly rather we can give them voluntarily. Yet i think that it is also impossible  to legalized  bitcoin without being taxed.

If they can provide a good solution for this tax issues that could both be beneficial to us bitcoin users and the government which is almost not possible cause one thing is for sure it would always be the government that are more beneficial

For now its impossible, its because only few merchants are accepting bitcoins. From this we can say that bitcoin works as investment and not as a currency and to tax an investment. One must the current value of that investment but how they gonna declare it if the price is so volatile that may have a big change in just an hour.

Definitely a big NO, why would anyone even think of this kind of idea, Bitcoin is the only thing that is not taxed and I am very happy to keep it this way, Now let's assume that the government one day decides to tax Bitcoins, how in the world would they able track it. Bitcoin Addresses can be changed by the buyer and seller, there is no guarantee that the person will transact in his or her name. There are so many possibilities, one can never track it and the whole idea would be a futile.

Nice idea but the bitcoin is not design to work as what youv'e said.. why we need to register and pay tax if every time we exchange the tax is always there..
Bitcoin is decentralize and technology and how adresses work is different from registering only only one adress for you to use..
But if this will happen it will affect the bitcoin price and I think it will beneficial in both of us..

It will not work my friend because we could make a hundred of wallet address in which if we register the one still we have 99 to hide but if you mean our local wallet then i'll support it because this is to ensure to trace the laundering in which it might possibly use in criminal activities and also i support the taxation as long as it will not corrupt it in which it will be use to the welfare and prosperity of the country. The prosperity of the country is the prosperity of all the people.

It may actually be a great stepping stone to get more people to trust Bitcoin. The Bitcoin community needs to work with government in order for it to work. If the governments don't like Bitcoin then consider it obsolete. Governments are mighty and powerful we are mere people.

No, I am not of course. I don't think if they can do such thing. Wallets are generating new addresses and who the heck are going to register their adresses for a tax in every transaction? We currently have issues on the transaction fees going high so how on earth we give them our addresses for additional tax? Damn, regulating and putting tax on local exchanges is enough. If registering addresses is gonna happen in the future I think we need another form of blockchain technology that could totally kill taxes or we might give them addresses that is often used. We can actually give them thousands of fake address for them to suffer severe headache. ;D

My opinion doesn't matter whether I am in favor to register my wallet address or not for taxation purposes. That is because it won't happen and lawmakers will always have hard time to trace the address owners. And one thing, how can a local government trace the owner if the address is from different country like the US? I reside here in PH so I'm not sure if the government here will take time to trace every address to trace all Filipinos who have btc wallet. And remember that we can always make multiple wallets and change addresses. And the uses of mixers will always be handy. But IF they succeed to put tax in it it's fine with me as long as it will be fair and reasonable and with utmost consideration.

Of course I do not want this to be seen by others. Because this is my personal transaction. and if someone else knew it was like I was stripped off of what they did. And another bitcoins are decentralized when people know where our bitcoins earned are as if they have centralized the bitcoins.

Im fine with submission of my personal documents to the legit exchanges because that is mandatory as part of complying with the rules of a certain country but for registering the address itself, Im not with that kind of idea.

In the first place what is the purpose? Some exchanges have records about their clients respective addresses so I think this is not necessary. Although it might be a big help in solving illegal activities via bitcoin transaction, it will affect the benefits and advantages why we are using crypto in the first place. Just improved the current security measures and that will be fine.

I don' think this is necessary and people are enjoying bitcoin because you enjoy the privilage of doing transactions anonymously. And if we're gonna be registering our addresses bitcoin will no longer be decentralized because the government will gain the upper hand to control the users.

No,  I wont registered it until there are no more hole for me to escape,  I was using bitcoin because I like my hidden transaction and I dont plan to reveal all my transaction to anyone,  if bitcoin being taxed maybe I will find other coin that still escape from the government supervision

This idea I feel will not work because if this is the way they want to ensure that taxes are levied, then they are bunch of jokers because I can then register just one wallet provider then use other wallets provider and aside that, the singular action of registering your btc wallet address to identify you, has taken everything bitcoin stands for that that relates to anonymity.

A way out is to go through the middle men and device a way out of the conventional levying of tax since that is their end game. For example using Coinbase for mostly US citizens, what is needed is to ensure that when you sell on that platform Coinbase deducts their fees and the tax element before paying you the balance thereafter remit it government.

Registering all your Bitcoin addresses are impractical, if you are using Bitcoin to protect your financial privacy from the general public. Whatever you do with Bitcoin, will eventually be audited and then you will have to explain yourself. Just keep record of all your income and expenditure within a specific financial year and provide the proof, when you are audited.

The tax man will only prosecute you, if you do not provide proof or data of your income and expenditure. The Blockchain has all the information they need, you just need to provide the Bitcoin addresses you used. ^smile^

I do not think it will happen now a days, i do not think also how the government impose tax in every transaction we made it is digital currency or decentralized currency which is no physical money involved with it. Also government will use only 1 bitcoin wallet and we will register with our identity to trace who is the person behind in every transaction but i do no think government will do that. Hoping that bitcoin will remain as it is right now.

It is not lately it started 4 years ago right after the March-April boom.
And there where a few who come with a project of white addresses that would also carry the identifier of the owner.
Since you don't see that project up and running you can think for yourself how the community has and would receive an idea like that.



Bitcoin will continue to be decentralized. Knowing the users behind the addresses does not limit decentralization.
Besides, the governments would easily track more than half of the coins.
A lot of us purchased coins on exchanges and verified themselves, a lot host (big mistake) their coins on web wallets, a few are paying their bills with so they can also be tracked. But this would just end anonymity, it doesn't mean the government will run the block chain.

It might sounds good for tracking illegal activities like money laundering but, it doesn't make sense at all. Bitcoin is created for the sole purpose of being a decentralized and anonymous digital coin.
It's already a successful project after all, then why would we let our ass to be regulated and worst, taxed by authorities? It will be a disgrace for Satoshi who give us this golden piece.

In not favor to register my bitcoin address to trace and tax because government are corrupt not only that impossible to track the bitcoin every time the address change its too hard to track and I know most of the user have dummy bitcoin address.

Yes, I favor to register the bitcoin address to transaction and tax, because it happens the bitcoin is permitted by law it means bitcoin be legal, the money comes from the bitcoin help to support the common resource like build a hospital and others.

Exactly also my point. I am so sure that many lawmakers still do not have even some basic grasp of how cryptocurrency is working. What the law provides is that taxpayers should be the ones to declare any income earned with any cryptocurrency related activities and until then there is no way that they can fully trace everything not unless they have the control on how many coin address a person can create. I hope they can first have a good talk with someone who can advise them on matters of cryptocurrency before espousing any idea which will never work at all.

I think this is impossible.First of all people don't use 1 address to receive or sell bitcoin.Only paper and some others people who have private key of their wallet they only use 1 address. And police or government can not verify who received or sell bitcoin.So I think it will never happen.

in other words "are you willingly going to invade your own privacy" LOL.

and there is no practical way of doing that by the way. because first of all you shouldn't be reusing bitcoin addresses to begin with so every transaction means having a new address and maybe you are just transferring bitcoin from one wallet to another (like from your hot wallet to cold storage). it becomes a mess to explain all of it.

any taxes is usually either on "profit", like trading profit which is 100% clear since you do it on a centralized exchange, or it is from mining, again should be nearly clear, or offering a service like owning a business which is again clear.
and AFAIK it is the same as fiat. you don't pay taxes for holding fiat, but you do pay taxes if you have a shop, or if you buy a house.

This sounds like a privacy nightmare. You might as well start posting your bank transactions online because that's pretty much how this is going to look like. I do hope there is a way to do this without compromising on privacy in the future.

I think that it is possible but it needed a lot of effort from the government and the bitcoin users. But I think the bicoin users will not accept it because bitcoin address changes when you create a transactions, that means that they need to register ther address every single time the had a transaction qhich I think a big hastle to them.

I'm not gonna favor on this way, you see  btc can be hacked through some expert at their given field I will and I will not gonna put my btc addressed into any kind of vocal mouth in some what way.

Nah not really, Bitcoin addresses come and go and they can be very problematic to account for multiple transactions daily and multiple addresses for fees and what not.

In bitcoin world is not possible to trace people transaction because almost every wallet have the features of creating atleast 3 wallet address per account but if they could trace the IP of the wallet address owner or if exchange expose their customer information, I guess that is possible.

Lawmakers-Do you have any Bitcoin?
Me-No

That is never going to work, they can do this with credit cards because they have control of who gets what number and they can make a quick research on you but in bitcoin you can download a wallet and create hundreds of address, how are they going to control that?

 I agree , for sure if the your country will fully welcome and formally legalize the cyrpto currency, the government will surely find ways on how to trace all the transaction for the sake of tax generation. I think that is one of the disadvantage when that time comes.

Of course I'm not in favor. And who are we supposed to register with, exactly? Some government office? I don't register my bank accounts with the government. The banks are supposed to forward Suspicious Activity Reports above a certain threshold of activity or if structuring is involved, but otherwise my banking activity is none of the government's business. Why should this be any different?

Anyway, it's simply not workable, particularly with the way that Bitcoin works. Users aren't supposed to be reusing addresses, and wallets don't reuse them by default. Are we supposed to register addresses that aren't even visible in the wallet yet?!

Governments should regulate exchanges and brokers, and tax authorities should publish tax guidance. What the OP is talking about is straight out of some dystopia...

That would not work with the mechanics of bitcoin but even if it did I would not agree with that, simply because it's against everything bitcoin fights against. When you want decentralization and freedom against that type of power and control from entities you cannot allow such a thing.

Depending on where you live Bitcoin is being taxed right this very second. It's the users' job to tell the tax man about their huge profits and it's the same in virtually every other area of life too.

I am hearing this for the first time that someone will be able to trace back to you when you have not disclosed your amount of coins stored in your wallet  :P
unless you disclose your wealth stored in crypto currencies how on earth are they able to know how much you are worth and why would anyone pay taxes for storing their coins in their wallet,this is just absurd and no one will disclose their worth to anyone unless they wanted to convert some of the coins to fiat.

Correct, people will have to limit themselves and we know that is never going to work, now the government may create their own wallets and ask their citizens to use them but the moment your bitcoin is out of that wallet, if you ever put it there, then they no longer have any control over your bitcoin.

Taxing all of the newly generated addresses in your wallet might be a difficult task! Not impossible, but though!  I would be in favor of this, because you would be able to trace the source of the BTC coming to your wallets. With that I believe BTC would gain more users because it would start getting in the legal standards!

you have a good point. Taxes should only be performed  when a certain person uses a general services or to buy anything and profits.

 If bitcoin could someday be taxable it would really be hard for the investors to buy bitcoin because of being charged for a tax which is an acceptable. Unless if you are going to buy something  which is i think was already being performed

There's no point.  Anyone that wants to hide a transaction can do it quite easily.  Anyone that feels compelled to pay taxes can do it as capital gains or equivalent. 

It's not just about hiding a transaction, though. It's about the larger question of privacy in the context of a public, transparent blockchain. In some ways, Bitcoin is so transparent that it works right into regulators' and law enforcement's hands. Sure, you can hide transactions now.

But with the speed at which blockchain analysis companies are developing and given that governments now seem very interested in cryptocurrencies, I don't think it will be so easy in the future. Not unless Bitcoin develops significantly better privacy features, like sidechains/drivechains that use CT, the Lightning Network, Tumblebit, etc. Law enforcement watches the centralized mixers closely (if they aren't running some themselves), and they run lots of TOR exit nodes, too. We need much better privacy technology.

There is no one fixed address and anyone can generate as many as he wants.What is the point in registering address then?

No, why should i let them know my full information, my transactions and what I do. I never reuse an address in the first place so i can't register a single btc address. I already pay the transaction fee so why should i let them impose another tax on top of that? They should just tax the merchant who accepts bitcoin and the exchange.

kinda defeats the purpose of bitcoin don't you think ?? it's really a problem that needs a solution in order for bitcoin to have a future.

I would be happy if it is only for tracing my transactions, but with taxes? That would be a big hindrance with just little bitcoin earnings, And where would the taxes go? Since other countries did not legalize bitcoin some people who are using it still may get traced to where they are using but i still do not think that is also benefit for it will be a cause for lesser bitcoin oriented population. It will also discourage new participants to commit given that newbies or new participating members have very fair payout, if it gets tax decrease how do you think users will react. They might start wanting to be anonymous and hide their transactions by using other sites for receiving.

I don't see anything bad with this I just hope that if they will imposed that full adaptation and acceptability of bitcoin must be implemented by government so that the demand in bitcoin will grow more and the value will continue to increase

I can agree with everyone who say that question by OP have no sense and that something like that would never worked.Using only one address is completely the opposite what represents BTC and it would be like we have account in normal bank.Only way government can track BTC users to collect tax is to force all exchanges that collect users data and give them that data back once a year.So if you are verified user who buy/sell BTC on exchange you will pay tax.Question is do we pay tax just to own BTC or in case we sell it for fiat?

If this will happen, it will be fine with me as long as there will be an assurance for us bitcoin users that are wallets and account would still be safe from possible risk of hacking. I also hope that this will not cause too much stictness to us. However, this thing might be hard to implement since tracing of address is already difficult and tracing would already cost a lot of money.

Paying tax when a currency appreciate in value is stupid. The government does not compensate you when they debase the value of you fiat currency.

Stop worrying about taxes, it has nothing to do with the government.

If you have ever authorized them to do so the best they can do is to see the transactions you are having but they won't see what kind of transaction are they because they won't know it if it is for buying or selling and if it is for remittance. It all boils down to the Bitcoin iser of becoming an honest person who will be paying his or her right taxes. I want this to work in order for the government to be in full support of Bitcoin

As I said in a previous post, the governments may try to create their own bitcoin wallets, there is nothing stopping them from doing it, but if you do you will probably have to go through KYC policies and they are only going to give you one address, but that will require the cooperation of the people.

Agree Sir, having bitcoin under taxes and being traced will make slower transaction. So what will e the benefit of using bitcoins.  Firstly, no more free from fees ?, no more fast transaction ?, no more anonymity ? In general no more profits because of taxes..
I am against it also.

That won't be a great idea. I prefer our wallets to remain invincible from the government. Everything is being taxed now it's not fair that we are sharing to them everything we worked hard to achieve.

Well well the government wont stop until they tax everything. if they can tax the air we breath they will definitely do it too  ;D . But taxing bitcoin would be impossible because in a single wallet there are many addresses that can be used for transactions and the devs of the wallet won't allow it to be regulated because they will lose profits too. So dont fear that bitcoin and its transactions will be taxed by the government.

I am not in favor of it. That is foolish to inject such laws and policies to an invention primarily done as an opposite reaction to it. But that should not be the case to lawmakers as well as other public officials and officers, both elected and appointed. These people are public property. For them to become really an open book, there should be utmost transparency to them. But to ordinary citizens, it is not needed. Bitcoin is against it!

I'm in favor of registering our bitcoin address to trace transactions but not to impose additional tax. I think no one wants wants additional taxes because it raises our transaction fees in trading bitcoin.

If you are using centralized exchanges like Coinbase then I guess it's a bit hard to avoid taxes. It is somewhat true even if you are using any other exchange that follow KYC/AML laws and Bitcoin is taxable in your country. As far as you are converting Bitcoin to your local currency and the conversion can be tracked backed to a Bitcoin exchange, you're are liable to pay taxes.

Taxes ends with Fiat conversion. I am not legally obliged to report my non-fiat Bitcoin transactions.

Disagree. I don't like someone snooping on my bitcoins and regulating it specially taxing it. If it does, however, make bitcoins safer for everyone (because as far as I know bitcoins are safe to begin with) then I'd agree for it to be traced down but I disagree fully on having it taxed.

Trace it all they want as long as they don't tax my bitcoin, then there's no problem. I'd be angrh knowing some government who doesn't give a damn about us investors trying to take our bitcoins just so they can "trace" it.

No,i would never want to reveal my identity regarding using bitcoins.Bitcoin is mainly chosen due to its decentralized nature since it is out of reach of the government and due to its anonymous nature.People who are already fed of government's taxes have started to choose bitcoin as their safe haven.

So,no one would deliberately come forward to reveal their identity unless it is strictly enforced by government through laws.

In my point of view this would help lessen criminality in bitcoin world like scamming since it would be easy to identify people behind scammers address and regarding tax?in my country tax is like a burden for people but its an obligation to pay for so cant do nothing about that if government implement.

Well if you transfer btc from one address to another one... would there still be trace?  For example say you do lot of transactions with a few btc addresses, but could you transfer it to an address where  it doesn't link you to those previous transactions?