Bitcoin Forum

I'm a finance writer and I think bitcoin is one of the most interesting ideas I've come across for a long time (I usually concentrate on gold when it comes to avoiding fiat currencies). I don't for a minute pretend to understand the technology behind this. But assuming that it is sound, so far so good. The world would benefit from free market currency or currencies, and even had them until quite recently.

But there one potential flaw to bitcoin that springs to mind. Governments may not be able to control the supply of bitcoins, but they may be able to control their use.

So if you want to buy a good or service in any country, that country may make it illegal for a business to receive payment in bitcoins. Worse, many countries may collaborate to make it illegal across large parts of the world. So legitimate businesses, that would usually accept payment in bitcoins, would be forced to stop or face potentially severe penalties (fines, jail sentences, removal of licences or whatever).

One way around this would be for some kind of offshore exchange where you could convert your bitcoins back into dollars or whatever. Then bring them onshore to make payments. But then the privacy would be lost (cross border banking is monitored). Also these "bitcoin havens" would probably have similar pressures put on them as the offshore tax havens. For example, regulators could just say that the bitcoin system is open to money laundering (organised crime, drugs) and/or is a way to finance terrorism (as with efforts to clamp down on the traditional hawala money payments system in the Arab world after 9/11).

So if bitcoins end up being severely restricted as a form of payment for useful goods and services, I wonder if they would keep any value at all. Ultimately money has to be easily exchangeable into something you can use (goods, services, houses).

Has anyone got any thoughts on this? I'm new to bitcoin, so I'm sure many of you have been through this kind of thing before. Would love to hear your ideas.

Thanks

I think it will be some time before any government tries to outright ban the use of Bitcoin, if at all. By the time that happens, I think it will have little effect, just as attempts to prevent use of bittorrent have had little effect.

Governments are a huge potential threat to BitCoin.  If your legitimate business can be shut down for accepting Bitcoins, they certainly can harm you.  Unless you are able to have a transaction where they couldn't shut you down of course.

The value would be much lower if they are banned in places, and much higher if use is widespread.  Most people will obey their governments, so it would certainly lower the usage, and lower their value.

Torrents are not illegal, just certain content is illegal to share.  But if you were selling torrent files in a store, you can bet your ass you would get shut down quickly.

This is why the torrent sites are located in places that are more friendly.  If you can sell things without being able to be identified, yeah, they will have a harder time.

You can not fully compare Bitcoin to Bittorrent. A Bittorrent user that downloads a torrent from the newest episode of his favorite TV series on his backroom computer is something different than a business, that publicly announces, that it accepts BTC.

No WAI!  GOVERNMENT STUPID, BITCOINS USERS SMART!  WE WILL DESTROY THEM!

The major potential I see for Bitcoin are not so much large retailers but small entrepreneurs, freelancers, and the grey market, especially in developing countries where a lot of trade happens off the radar anyhow. Even in richer countries like Italy there is a huge underground economy that the government struggles to tax or regulate.  

It is going to be almost impossible to enforce a Bitcoin ban in this sector. That would be even harder than trying to enforce a ban on cash!

Many of the slums in the world's megacities are a cash-only economy, because a lot of slum dwellers don't even have documents, let alone a bank account.  This isn't a small economy though.  In 3-5 years time every favelado in Rio is going to own a smartphone.  Imagine what an improvement Bitcoin would offer for them compared to cash.  When the Brazilian government  struggles to keep the armed gangs under control, do you really think that enforcing a Bitcoin ban is going to be high on its list of priorities? They've got other things to worry about!
 

Anyhow, I think it's unlikely that Bitcoin will be banned outright in the West. What we are more likely to see are attempts to regulate it, and prosecution of individual users rather than the network as a whole.  

See the history of bittorrent for an analogy.

The govt. would not ban bitcoin commerce without a very good pretext in place first. Govt.s acting arbitrarily against seemingly peaceful activities can get voted out in an awful hurry ... they need a good reason to ban it or else they just look like petty tyrants ... perception is everything.

If/wehn they do ban all trades in bitcoin then another better block chain will have already started, call it bytecoin ... will they ban that too? What will they legally allow and not allow, some things like IPv4 address trading may get caught up in the ban if the wording is not perfect.

It is a legal minefield and would drag govt.s into courts for years trying to figure of out fine distinctions in crypto-technology that politicians have no clue about.

In the mean time crypto has figured a work around whatever is the rule-of-the-day coming form the central-planners of crap fiat money and the game goes on.

They will exhaust themselves chopping heads off the hydra ... good luck to them, it is the greatest trojan attack ever. If they engage they are fucked, if the adopt it they are fucked because the hard monetary standard will only support the most minimal of state structures.

Change in the legal system happens very very slowly, and the internet moves lightning fast. It will take politicians and judges years to even get their head around what a p2p cryptocurrency is in the first place, and by that time their 10-year old daughters will be using Bitcoin as in-game currency for MMOGs.

True, but imagine holding onto a currency that you can't spend in your own country. Seems kind of pointless, doesn't it?

Let's play the role of the government:

"Bitcoin is used to pay for drugs, weapons and child porn"

There you go, the government saving the stupid people from themselves, again.

Not necessarily. Most Swiss Francs in circulation are held by people who don't live in Switzerland.  Same could happen to BTC if it's perceived as an currency that won't lose its value.

You haven't exactly spelt how they would physically stop someone spending it "in their own country".

They can ban it, like all you statists are drooling about, but what would that mean if everyone ignored it because they know it is uneforceable ... laws like that delegitimizes their authority, and anarchy follows after that.

There are some basic human rights issues with banning bitcoins for trade.  It would be equivalent of banning bartering.

I could imagine 'soft' measures to discourage it, however, using the excuse of money laundering, purchase of illegal goods, and 'cash in hand' work for tax avoidance.  

So attempts at monitoring and investigating bitcoin transactions will almost definitely happen, though to what extent is the real question.  It may be that when you have a legitimate reason for trading large volumes of bitcoin you will have to register yourself with an official body and submit to audits, or risk investigation and possible prosecution.

As someone looking to build legitimate business on BitCoin, this is something I've thought quite a bit about.  The answer seems to be that there are good arguments to convince governments not to do this.  As noted in the first serious article about BitCoin money-laundering concerns (http://bitcointalk.org/index.php?topic=5907.0), nothing prevents a well-funded criminal organisation from launching their own version of BitCoin and completely ignoring any outside authorities.  Removing the possibility for legitimate businesses to deal in bitcoins will simply drive the system underground instead of providing the wide range of warrant-accessible information that results from the practice of legitimate business.

BitCoin is best understood not as a threat itself, but as the discovery of a mathematical possibility that has always existed.  Given that this is the case, I believe forward-thinking policymakers should take advantage of the opportunity to support an above-board counterpart to darker possibilities.  The BitCoin community as it currently exists is open-source, transparent, and intentionally accessible--not features you'd find in a criminal cartel's version, but very hopeful ones for those looking to protect society from malevolent actions.  It does require a shift in mentality and approach, but the time to make that shift is now.  Certain types of information, sometimes more than is available with cash, can be gained from blockchain and network analysis.  But the key to stopping criminal action via BitCoin is the same approach that applies to credit card and PayPal fraud as well as any type of money laundering:

• honeypots
• social infiltration
• tracking of physical goods, especially those that defy declared income, and
• implementing strong trust mechanisms

Over a decade ago I was saying that major players in the media industry should build their own file-sharing networks:  at the time I was laughed at but we now know that the branding and positioning potential of that move would have been huge.  Just look at YouTube's successful play in the online video space to see how that might have gone down.  The only way to have any say in the shape of our digital tomorrow is to supply a part of it yourself--the first country who embraces digital currency as not just uncontainable but an innovation-enabler will probably be the superpower of tomorrow.

Just my .02 btc on the topic--I'd be happy to explain the underlying technology of BitCoin to you in plain language, or offer you a quote if you're planning to write something.


p.s.  Those of you who are filling up the thread with your personal hobby horses aren't being very helpful.  These forums are getting too swamped for every thread to get hijacked like this--try to take a little time and think through a careful response to the OP.

They can't stop people from trading it, but they can stop businesses from advertising that they accept it. They can also run sting operations to catch people. If it was banned it would become a cat and mouse game, like with any other contraband.

Pretty hypocritical don't you think, seeing as your post is the longest with perhaps the largest baggage agenda (statist bitcoin adoption) of anyone who has posted on the thread?

Mirror, you, look.

It is just another example of a noob asking a provocative question, why would he assume it will be made illegal?

It is like someone just invented a new browser (al gore) and the first question the noob asks is "what if they made that illegal?

The asking of the question is more instructive of the wider society's statist mindest surrounding financial affairs that the banksters have brain-washed everybody into. It is a ridiculous question asked by slaves to the current facist financial-political structure.

@robm You can ignore him.

Isn't it an oxymoron to call the current financial-political structure fascist and yet state it is ridiculous question to ask whether bitcoin might be made illegal?

Here's a better question:

What if we make governments illegal?

Thanks very much for the first round of thoughts and ideas on this. I can see that people interested in this project range from the idealistic,  through sensible and pragmatic, through the very technically minded, and into the possibly well meaning, but incoherently ranting anarchist types (in my experience, usually the first in line for government handouts).

Anything new should be approached with a critical mind, especially if it involves handing over money you have earned and saved. I actually think it would be quite simple for a government to block payments with any new currency. The concept (and the debate) might exist in cyberspace, but we all have to actually live in the real world. That's the place where we shelter from the rain, drink coffee, have parties, listen to music or whatever. Any functioning currency has to work where we live. And we can't all live in Brazilian favelas (nor would we want to) or remote tropical islands (much as we might actually want to).

I come from the UK, which is one of many wealthy countries that is driving itself into the ground with excessive debt and money printing. The process is slow, but the end point is likely to be disaster. I emigrated to Argentina in 2008, permanently. If you want to learn about financial crises and weak money, this is the place to be. This is a cash economy, with a huge black market. One third of all employees are off the books (at least), tax dodging is the national sport, and physical paper currency is actually constantly in short supply on the streets. At one point last year the central bank had to buy in supplies from neighbouring Brazil to cover a shortfall, as the printing presses weren't whirring fast enough.

That said they are printing it pretty fast. Price inflation is 25% plus per year (when compounded, that's a doubling of prices roughly every three years). No doubt the next major financial crisis here can't be far away (last time in 2001, the currency lost about two thirds of its value against the dollar in a short time).

Argentina has many financial and social problems, but I feel lucky to live here compared with the alternative at home or in Europe and the US. (At least I have day to day freedoms due to fewer rules. Quite something for a place that was a dictatorship until mid 1980s when I'm comparing it to the supposedly liberal democracies of Europe and the US.). I've also lived and worked in Asia, mainly China, so have seen a bit of how things work over there too.

I suppose I would LIKE something like bitcoin to work, but I'm also naturally sceptical about everything new and try to be pragmatic. If you have an ideology, put it aside and think how things work in the real world. Businesses need to handle payments, pay suppliers, produce accounts and pay taxes. If their income is in bitcoins but their costs are in dollars, they need to transact between the two. This is a complex topic, but basically I think it would be easy to monitor and hard to hide. And if you live in California, you can't pop out for pizza in the Cayman Islands.

So my guess is that if anything like bitcoin was ever successful, governments would clamp down on it. This kind of concept threatens the very root of modern government: being able to finance vote buying and empire. That is likely to attract kickback. Laws, taxation, international treaties, and of course media smear campaigns all feature in the armoury (see the treatment of Julian Assange for evidence).

I remain sceptical that bitcoin can ever really get off the ground, other than in a niche way. But I'll drink a toast if it does.

Looking forward to your additional thoughts in the meantime.

Troll. (as I suspected from the first)

Someone should close this thread down, post haste.

No, because the the slaves think they live in a free system, so why would they ask a question like this?

(I should have called it a crypto-facist financial-political, I suppose.)

If the Argentinian government can't even stop a black market running on cash, how is it going to stop a black market running on Bitcoin?

Bitcoin is easier to conceal than cash, and harder to detect.

It's just ridiculous to think of the big brave govt. thugs showing up with the machinery of the state, paid for by the tax-payers, raiding the homes of gamers living in their mom's basement, to cart away their "illegal video game rigs". Who would even think to ask such a question, govt. paid foil, statist troll, failed bankster .... I wonder?

But there you go anything is possible in a crypto-facist state, I suppose. Banning on-line video games for trading tokens.

It's a fair question. But this place is so far gone, it's almost beyond redemption. The black market IS the economy to a large extent. So it would be deeply politically unpopular to clamp down too hard. And the politicians are corrupt, populist and incompetent even by global standards. I suspect the US would do a much better job of clamping down, for example, due to much more sophisticated state apparatus (despite its many flaws).

Thanks Moa. This made me laugh. I've never been called a troll before.

Especially not by an aspiring Joseph Goebbels (Hitler's propaganda chief) such as yourself.

I assume that's where you're aiming, given your desire for censorship and complete disrespect for anyone that doesn't agree with your dogma.

Quoted for truth, glad I'm not alone in this sentiment.

I went to Argentina a few times in the last years, and I found this particular fact rather astonishing. It was a real struggle to pay for anything because people often don't have change. So you have to be careful to break your bills in larger stores so that you later can afford to pay for the taxi home.

One more advantage of BitCoin. You will be able to pay for something in 0.05491 BTC and get exact change every time. (This is not quite the case yet as to reduce spam the client restricts transactions below 0.01 BTC.)


Indeed. I wrote up a doomsday scenario based, in part, on this idea (perhaps with a touch too much sensationalism in my tone): http://bitcointalk.org/index.php?topic=6007.0 (http://bitcointalk.org/index.php?topic=6007.0) In the scenario a government co-opts the BitCoin infrastructure by mandating their own technology at points of sale.

It will be quite interesting to see how the network adapts to the first legal and social attacks upon it. I believe the result will be very much controlled by the effectiveness of the propaganda that will go with it. BitCoin is, unfortunately, rather easy to paint in dark colours for a crafty state. Add to it that the initial supporters could be seen in the public eye as 'just a bunch of anarchists'.

The one thing that stood in BitTorrent's favour was that file copying was widespread and well liked by the people before the media industry turned the spotlight of the law against it. Maybe BitCoin too could establish a wide and well liked ecosystem before it comes into the crosshairs.

We clearly already have govt. employed cowards posting amongst us. Why don't they just come out and say that they are paid for by us to post in on-line forums? Yeah, I wonder why not.

Statist cowards protecting us from ourselves because we are too stupid to see the benevolence of their bankster masters.

Tellingly they have showed up at the same time as PayPal crapped its panties and Mt. Gox was DDOS.

I predict their next trick will be to start posting abusive and/or inflammatory material at an ever increasing rate to make the whole forum look like a an obscene war zone to scare off legitimate noobs and mainstream adopters ... seen it all before on the gold/silver forums about 4-5 years back. They are above nothing and they passed all the laws they need to do this under guise of anti-terrorism,

If the old men write it down we'll all obey and bitcoin will go the way of alcohol and marijuana.

Still making me laugh. You have no idea how far you are from the truth.

The deep irony of this is that you don't need "government employees" to "make the whole forum look like a an obscene war zone". You're kind do a great job of that already.

Or maybe this is a double bluff.

Is there something you should be telling us about who is paying you to discredit this project? Ha ha ha!

@robm

This is pushing it.  Don't cross this line.

In an attempt to return back to the question posed...

If governments succeed to ban the use of Bitcoin within their realms, as I'm sure that some will, so what?  Has the illegality of contraband actually stopped it's trade in meatspace?  By what method would the government actually be able to stop Bitcoin's trade in netspace?

It is true there would be a huge problem with enforceability. But if Bitcoin is relegated to only the black market online - you can use it but don't let anyone find out - that would hamstring it. Bitcoin would never reach its full potential. I for one think it would be delightful to be able to pay for goods on Amazon or even the local grocer in Bitcoin.

And there would be a whole economy for micro transactions, impossible with conventional payment processing systems. Perhaps if it grows large enough there will be money for pro-Bitcoin lobbying.

Failing that we should all be donating a lot more to EFF.

The premise in the first sentence above does not lead to the conclusion in the second sentence.  Certainly Bitcoin adoption will be hampered in nations wherein the powers that be can threaten users with real violence for doing so, but this will do little to prevent adoption in locales where this is not so.

I am not sure what you are trying to say here. All else being equal, less hampering of Bitcoin adoption means it reaches more of its potential. Even if it can survive laws, matters would be better if there were no laws against it anywhere. Resistance, local or not, limits Bitcoin's potential.

Are you saying Bitcoin has no potential at all in countries "where the powers that be can threaten real violence"? In that case I disagree. I think Bitcoin has great potential even in e.g. the western world.

I'm saying that the adoption rate of Bitcoin in some locales does not limit it's future success in those same locales.  If Bitcoin is going to succeed, it will do so eventually regardless of how long particular governments might be able to hold back the tide.  The only way that I can forsee such intervention actually preventing Bitcoin from anything, rather than simply delaying it, is if all the world's governments were to agree to use force against Bitcoin users collectively.  I don't consider such international cooperation likely.

haha! I was just going to post this.

Unless all governments ban/regulate bitcoin, it will be seen as a success in the nations where it is allowed and it's value will be backed by their economies. Also, such nations will thrive on a sound money standard.

The rest of the world will see this and soon governments will be force to come inline and legitimize bitcoin.

Also, to be honest, I think Bitcoin is just the beginning of a paradigm shift. Technology, ideas and social structures are evolving so fast that governments will not be able to keep pace. The rules of the game are changing.

Not sure why. It was a response to a request for censorship and a series of posts showing complete disrespect for anyone elses opinion.

It's interesting how freedom of speech so rarely gets a look in these days.

One thing that has not been mentioned in this thread is the first amendment defense.  To spend bitcoins, you basically announce to the world that you have done so.  To restrict bitcoin is to limit free speech.

I've thought about this some more.

There's another linked problem. Every day companies are striking contracts with employees, customers and suppliers. They promise to pay or receive an amount of money in return or with a promise to deliver a good or service.

These are documented contracts enforced in a court of law, and often very complex and in place for many years. Government has nothing to do with it. It's just a system for active agents in the economy to know where they stand, and know they have recourse if the other side breaks the agreement. Both sides benefit in other words.

Of course in very small companies (say family owned stores) more can be done for cash and on a word of mouth and trust basis. But for large and complex businesses this would never work.

So if governments move to ban the receipt of payments in bitcoins, chances are it will work. Bitcoins would become significantly less valuable, maybe  worthless. Relegated to a small niche of small transactions. The bulk of the economy would move on and ignore it in future.

Even in a hyperinflation, a return to gold backed currency is more likely than adoption of bit coins. Gold has a long history and is deeply ingrained in many cultures of the world (such as Asia and Middle East). If this was a horse race, I'd back a return to gold over bitcoins at this point.

Maybe I don't get it. But then I didn't get the "new paradigm" of the dot com bubble either. And I didn't lose money as a result.

I wish bitcoin luck because the idea is genuinely innovative and thought provoking, and will watch with interest. But I doubt it will be more than a short term fad in the real world.

bye, bye troll ... c u in another nym?

bye bye moabbels.

Because you were attacking his character by referencing a Nazi propagandist.  Disrespect for his viewpoints are fine, disrespect for the person is unacceptable behavior.
Notice, if you will, that it was just a warning; and you have not been censored so far.  You have a less than a dozen posts on this forum and you are already sideways with part of the existing membership.  That is not a good sign.

Bitcoin has applications for which it is uniquely suitable. There lies its potential IMO, not in competing with existing currencies and payment systems.  It will enable new business models that could not have existed without Bitcoin and that will depend on Bitcoin.  I agree that it may remain a niche currency, but I don't think it will ever disappear completely. Or a least it will be replaced by another p2p cryptocurrency.

It is very hard for us to imagine today what those business models might be, just like people could not have imagined in 1990 that Facebook is a viable business model.  Perhaps Bitcoin will even evolve into something whos prime use isn't a currency at all.  

As for the dot com bubble, the "new paradigm" did create real added value, this just took a longer time than most people expected, and the added value was grossly overestimated.

If you had invested in the right companies you would have made money.

Excellent idea!  I can no longer kill natives, own slaves, or beat my women.  Why is this last bastion of abusive behavior (government) still tolerated? 

Did you mean you can not name your child whatever you want except from the government approved list, walk in cities without being watched all the time and travel without being ass raped  at every airport?

I too often wonder..

Yes you're probably right. There might be some new business models that spring up. I just think its likely to stay in a small niche. And as for other p2p cryptocurrency, that might happen too. But people will only be able to deal with so many of these things at one time. Most people need simplicity in their lives, not dealing in 10 or 20 currencies.

Put another way, good money will drive out bad money. But  to be good, money has to be usable when exchanging goods.

As to the dot com bubble, the value added came much later in most cases. A lot of money was squandered early on. (Not to mention the rank fraud of a lot of it.)

It's not much different to physical infrastructure. Someone invests in building a bridge, they often lose money. But the people living each side of the valley benefit from being able to visit each other. For most innovation and investment to happen, the people putting the money up need to have a decent likelihood of reasonable profit. There will always be exceptions of course.

And for every Facebook there are probably thousands of failures. Buying bitcoins is like buying stock in one of those thousands of startups. You might get a Facebook, but chances are you'll get a fat zero.

Actually, contract law is a perfect area for Bitcoin to expand into.  Read up on Smart Contracts (http://en.wikipedia.org/wiki/Smart_contract (http://en.wikipedia.org/wiki/Smart_contract)).  Because Bitcoins, which are subjectively valuable, can be so easily manipulated at the program level, it's only matter of time before we have easily accessible contract enforcement outside of the traditional state court system (advanced escrows, specialized arbiters, self-enforcing contracts, penal bonds....). 

These implementations may occur both at the Bitcoin scripting level or through third-party providers (e.g. ClearCoin).  Indeed, the simple act of sending/receiving Bitcoins already represents a simple, self-enforcing smart contract (a transfer of property rights in Bitcoins).  Think of how many middlemen (banks, payment processors, government regulators) and costs are cut out just through a bit of Satoshi's code.

I anticipate many businesses (large and small) will start giving strong consideration to adopting the Bitcoin ecosystem when they realize that they can conduct business more predictably and cheaply without inefficient state courts and lawyer overhead.

Wait....what? Facebook is a viable business model?!?

... a finance writer huh? So you probably spend a lot of time apologising to the public punters for the monumental feck ups on Wall St. and The City and then spend the rest of the time schmoozing and kissing ass with them.

... big fat zero for vision I'm afraid.

Sorry but your prejudice has clouded your own vision here.

In my group we spend most of our time advising people how NOT to get ripped off by Wall St. That is when we're not criticising Ben Bernanke, the Federal Reserve and most governments.

Our aim to it help people to hold on to what they have. Hard money is a big theme in that. Gold is the usual reference point. Therefore bitcoin is something new in this direction, and of interest.

Hard money needs hard rules for it to work. So it's incompatible with anarchy.

The alternative is that we all go back to a barter economy and living in mud huts. But given the mass famines that would be required first, I think even I would prefer a hyperinflation as the alternative.

And of course, in that system, we wouldn't be able to engage in this light hearted internet banter that you enjoy so much.

thanks. i'll look into this.

Hard rules are compatible with anarchy when they are voluntarily accepted (because they are useful) instead of being enforced by violence. That's why Bitcoin can work.

To be honest I think it's only a matter of time. You will know that it started when you will see "PEDOPHILES USE BITCOIN CURRENCY" headlines in mainstream media. Politicians and bankers will not give away their power over money just like that. But I don't think they are able to destroy Bitcoin, just like they can't get rid of other P2P networks.

They don't need to stop it, they just need to scare a lot of people from using it.

Well we're getting a bit off topic here (my fault), but history suggests that if you overthrow one bunch of tyrants that a new bunch pretty soon spring up. Usually the same freedom fighting revolutionaries that were supposed to deliver the lumpen masses from serfdom.

Bitcoin can work because it has rules. I just don't think it would even be allowed to work in a big way, because it threatens the whole Western democratic political system. Namely being able to buy votes with borrowed or printed money. And I don't suppose autocrats in China and elsewhere would be super keen either.

It's just looks too easy to control in other words, despite what many of you might think. Plus any large system has massive inertia. Even if bitcoin did get off the ground and into the real economy in a big way, you're probably talking about decades to get real traction. Who knows what can happen over such a long period of time.

Bitcoin is just a product like any other. It is seeking to replace the most widely used products in the world. Achieving that is going to be like inventing a new artificial food with health benefits, but then trying to get everyone in the world to stop eating everything else. Might happen. Probably won't.

But I'm still open to suggestions on how these issues can be overcome.

I think that is overstating it a tad. It is sufficient for Bitcoin to have marginal utility for it to establish itself as a valid currency. It does not need to take over the world in one fell swoop, or even at all. If it becomes the major internet currency, used for micro-transactions, MMO money, pay-to-read newspapers and so on, that will be fine.

In the future when a new generation grows up with it they might start wondering why these old fashioned paper monies are so hard to use, lose their value so fast and are so bloody expensive to transact with. They will never be convinced of their utility and eventually shed today's currencies like an inherited dank smelling old coat.

All truly new innovation is resisted by the old guard, entrenched and made wealthy by the status quo. But the old guard has one fatal flaw: they die.

Yes you might be right about room for an internet currency. But if that was an important part of the economy then governments would get involved. Maybe a transaction tax. Maybe a ban. Maybe something else. In the end the people running those businesses have to live somewhere. Maybe we get new bitcoin tax havens. Who knows. But it still points to niche uses.

You say: "But the old guard has one fatal flaw: they die."

I say: "But the new guard has one fatal flaw: they overestimate their abilities."

I'm asking the Yale Law student a similar question about Bitcoin regulation in this thread: http://bitcointalk.org/index.php?topic=6247.msg106095#msg106095 (http://bitcointalk.org/index.php?topic=6247.msg106095#msg106095)

This is true. It happened in the US in 1789.

Oh this gets better, a finance write who's an advocate for gold. Well i've been reading about gold for over 15 years and there used to be very few who actually wrote anything sensible about gold and less than 1 in 200 who actually advocate for hard money ... so there's a high probability you must be one of those johhny-come-lately gold writers, who spent the best of their life scaring people away from hard money and in the last few years just found religion.

The way you are dissing bitcoin tells me you are definitely not a programmer and probably haven't much of a clue how bitcoin works, for instance tell me how does the public-private key pair encryption schema work in your own words and why it is important for bitcoin?

Then maybe we can have an informed conversation about "What if receiving payments in bitcoins is made illegal?"

You'd better get up to speed or you'll just look like an ignorant troll hard money gold finance writer. Bitcoin is a monetary technology that solves problems of pricing information distributions and optimal resource allocations, it is in essence an information technology. Perhaps you are out of your depth here to be commenting on technologies.

As usual you prejudice leads you down a blind alley. I've been an advocate of gold for 7 years, ever since I started educating myself about the ballooning debt problem and failing financial system. Two years after the gold market bottom maybe, but better than being 6 years early like yourself and the other superhumans.

I have not been dissing bitcoin. Merely asking legitimate questions about how it might work in the real world. It's a pity you think that's negative. This kind of intolerance to the unbelievers is typical of a religious dogma. It makes me more certain that bitcoin is more a philosophy or ideal than a workable solution for the economy.

I don't know much about technology. More than that I don't want to know much about technology. Everyone has their areas of expertise, and that isn't mine. But the vast majority of people don't understand technology. So for bitcoin to become viable it has to gain our trust and understanding. It will need level headed advocates in other words.

What I do know a lot about are finance, business and investing. The sort of things that bitcoin would be used in if it was successful. Perhaps YOU are out of your depth once you get beyond the technical side. Indeed your responses (or rather lack of constructive responses) confirm that.

I didn't expect that kind of blind dogma in this kind of forum, but then, as the folks at Monty Python said, no one expects the Spanish Inquisition.

Without even knowing how the technology of bitcoin works I struggle to understand why you think you are qualified to comment on legality of bitcoin. Everyone is entitled to an opinion though, so carry on.

We'll agree to disagree and leave it that.

@moa

"we'll agree to disagree"

from a heretic and unbeliever (not just in this particular religion), I'd like to say:

Amen to that

This is where I think how bitcoin will survive many legal attacks.   The exchange of bitcoins is the exchange of information, and as I understand it this is protected by the first amendment.  Does anyone see a way around this by the government?  Sure, there may be some specifics cases where the use of bitcoins for committing crimes will be blocked, but just the simple use of bitcoin can't be made illegal in the US without a Constitutional Amendment.

"When they outlaw freedom, only outlaws will be free."

If bitcoin is made illegal, I will immediately delete my wallet. Because to me, the law is more than an opinion backed by violence .. It's my moral compass. If it wasn't for the the law, god know's what I'd get up to.

Tell me you aren't serious.

I'm going to read your other posts now to find out.

 ;D
Made you look!

Haha, yes, you are in the clear.

Right on. Why, if they didn't make laws against using heroin, I'd be a junkie within hours.

Wait a minute... do they have a law against suicide where I live? Shoot! I'd better find out. And if they don't I'll be moving to a state where they do, otherwise I'm liable to chug some bleach because nobody told me not to.

why would they need to ban it if every country in the world has already given its central bank the monopoly on issuing currency and made all other currencies illegal? in the "spirit of the law" bitcoin is already illegal everywhere. some of the laws might technically not include digital-/crypto-currencies but they will likely change that swiftly once they wake up.


they wouldn't (need to) do that, or only in some extreme cases. if bitcoin grows over critical mass to wake them up they will make exchanges between bitcoin and fiat currencies illegal, they'll threaten any financial institution that engages in such exchanges, and they will generally make all bitcoin transactions illegal. they might go after the users or they might not. the exchanges are the critical point (at least until all fiat currencies disappear) - that's why i believe bitcoin needs a working underground peer-to-peer exchange system asap to survive in the long run (was proposed in another thread somewhere). they wouldn't be able to control that or enforce their laws once that exists. but reaching mainstream adoption will be very difficult this way, eg the majority of online poker players wouldn't wanna go through these hoops.

not trying to burst your bubble but to inject some realism! bitcoin has the power to severely disrupt the core of the current capitalist empire. you might be too naive if you think the empire will not strike back. it will with full force, better to be prepared for it and find solutions to overcome it than to keep dreaming imho

The use of non-national currencies is not illegal in the United States. Legal tender means that if you owee someone for a good or service and they bring you to court, the court will force you to pay in federal reserve notes, even if you have a contract specifying payment in another currency.