Bitcoin Forum

Nobody has the authority to regulate Bitcoin:
http://www.theguardian.com/business/2014/feb/27/janet-yellen-federal-reserve-no-authority-regulate-bitcoin?CMP=twt_fd

I'd say the more obvious case is that Bitcoin has no authority to be regulated: there is no one, person or organisation, which controls Bitcoin.  You'd have to apply some draconian, global legislation between all countries, and they cant even agree on easy stuff like free trade.

Interesting quote though: "“Bitcoin is a payment innovation that’s taking place outside the banking industry. To the best of my knowledge there’s no intersection at all"... but they can regulate that intersection.

Right on! You got that right. Who would have thought the central bank for the US would join others like the central bank for Cyprus saying, essentially, it's not their business. Right. On.

Hopefully their stance stays like this.
This is a good thing.

That's the thing about clear public statements in politics. It's quite hard to reverse them.

Saying that a given entity currently has no power to regulate something means little.  They can be given that power or it can be given to another government agency. 

They can be given that power from whom? JP Morgan? A government can only do what its citizens allow it to do.

That's why governments that wish to retain as much power as possible (basically all of them) restrict their citizens as much as is practical, because not doing so empowers them. Ultimately so long as citizens have little ability and sentiment to violently resist their government any government can remain in power, e.g. communist regimes like Russia, China, North Korea etc. The U.S. is interestingly unique, because its legal framework was specifically crafted to keep too much power from consolidating into government, while empowering ordinary people (e.g. freedom of the press, right to bear arms etc.). So the U.S. tests its boundaries instead with regard to the U.S. Constitution (see NSA, Snowden etc.). At the end of the day, though, there is so much power simply in controlling money that sufficient control over that is enough for any government to get away with most anything. Bitcoin, however, will push back on even that.

This has been your daily civics lesson.

Possibly the most sensible words I've ever heard from the Fed.  They may have just clawed back a shred of respectability there.  Fingers crossed they keep this new-found sensibility up.

Maybe because a woman said those words?  ;D It would be curious if she gets elected as the next chair(man?)...

PS: Just learnt that she is the current chair(woman?)... lol

I seem to remember her predecessor, Ben Bernake, saying the same thing.  Considering Bitcoin and other cryptocurrency is far from the only alternative currency in the US, or even the oldest, it's not hard to believe the Federal Reserve doesn't see it as something particularly difficult to deal with.

In an ideal world you would be right. In this world unfortunately governments tend to seize power if it's not given to them voluntarily. The US isn't much better. Maybe the US politicians need to turn up with more some more convincing BS then other governments but at the end of the day they will seize that power just like their colleagues in North Korea.

Politicians are already hitching to control Bitcoin. Even they don't have authority they will try to regulate.

Bitcoin itself may not be regulated but you can sure as hell regulate the users of Bitcoin.

Don't expect the free ride to last much longer.

When was the last time that US citizens didn't allow their government to do something? 1776?

repentance is right. Moreover, Yellen didn't say nobody has the authority to regulate Bitcoin. She said the Federal Reserve doesn't. The title of this thread is completely wrong.

TO bad for Yellen she lives in a dream world  :D

So stop believing in exchanges that say you cannot withdraw BTC due to KYC/AML! Bitstamp is doing that, smells like the next Mt. Gox;

Yellen is correct in her statement, so that is really good news for Bitcoin, and was able to make that senator to shut up.

in brief:
Decentralized: not regulated
Centralized: Regulated

That is why decentralized open source exchanges are very important to take place in the near future.

Bitcoin will help boost the US economy and that is a really good thing, even better it will prove that good economies are not based on debt.

They might not be able to regulate bitcoin but they will definitely try to find a way to regulate their citizens using it.

Governments can't regulate bitcoin transactions, but they can regulate businesses, and tax goods.
Transactions will be harder to trace, but once you have matched one address to a person, you can easily identify contact addresses.
Some taxes will be harder or impossible to collect, like tax for property, inheritance, large gifts etc. It will still be possible to catch tax dodgers when they screw something up though.

Businesses accepting Bitcoin, no matter if they are exchanges or simply merchants, are already being regulated by the US.

All businesses in the US have to follow FinCen Money Laundering regulation and some of them fall under their definition of money transmitting businesses. That is the reason why there is no big public exchange in the US right now. So yes, the Fed (currently) has no authorityto regulate Bitcoin but she also said that


Which means they are happy with the current state of their regulation and any Bitcoin business better be prepared to follow AML and KYC regulation to the letter. Especially if you qualify as a money transmitter, which by the way is pretty easy to do. Just buy and sell bitcoin on localbitcoins and bam you are a money transmitter. If you don't believe me, ask those guys in Florida that were arrested for being part of a money laundering scheme.

regarding taxes, the IRS is not going to let people flagrantly evade taxes using Bitcoins. At least not for long. They will think of something. maybe they will simply require all bitcoin business to collect 10% taxes on every transaction. You can then go to the IRS and prove to them that your Bitcoin holdings are open, transparent and taxed and get your 10% back. A withholding tax to ensure tax compliance would not be unheard of. And you better believe merchants are going to comply if the alternative is a nice stint in federal prison for tax evasion.

Nobody has the authority to:

steal your money at gunpoint to fund their arbitrary whims
force you into their contract before you are able to consent
force their will upon you up to the point of death/beating/caging for non-crimes
claim ownership of your body and your possessions

But they do it anyway.  To think they wouldn't claim ownership of bitcoin is absurd given the lines they have already crossed.

#Eric Cartman does.

which in turn will slowly kill bitcoin even if its not directly regulated.