Bitcoin Forum

It's very hard to start a business in the United States without doing something illegal. I imagine it is the same in most other countries. The problem is that the number of regulations in time have grown so dramatically that they now invade every aspect of our lives. Most of the business that you can probably think of will be illegal, and thus you either have to do them illegally and probably be jailed, or just not do them. Most people don't do them. This is tragic. Opportunities are lost. Technologies are not invented. The world is not made better. All because the government does everything in its power to make the elites invulnerable to competition.

I don't advise making a company that does anything unethical. Unfortunately, the law and ethics do not overlap very much. Almost all regulations are there to entrench powers, not to ensure ethics. Bitcoin provides an opportunity to work around this problem by making anonymous companies. Silk Road is an example of this. They have established what a successful business anonymously. This is possible because payments are made with bitcoins. This would obviously not be possible with credit cards, where the identities of everyone involved would be seen by third parties.

Thus, we see that bitcoin has solved the most important remaining problem preventing anonymous companies: payments can now be made anonymously (or at least pseudonymously) over the internet. This is huge. Go back and think of all those business ideas you had, but didn't do, because they were illegal. They are now made possible with bitcoin. Again, I don't advise anyone do anything unethical - just illegal. Take patents, for example. They are a ludicrous regulation that shouldn't exist. So ignore them. Just make your business anonymous, and no one can enforce the patent on you. You will be immune.

I believe it will become mainstream to create anonymous companies, insofar as that is necessary to avoid corrupt regulations. It is only a matter of having the relevant technologies in place, and bitcoin is probably the most significant advance along this front in recent history. The success of Silk Road is evidence that all the relevant technologies are now in place. Being able to ignore regulations is an enormous advance. Everything will be cheaper and rate of innovation will accelerate. Anonymous or pseudonymous companies are the future. The economic pressure for this just means it is a question if how fast this happens, not if. It will be anarchy. In a good way.

Once transaction scripts (https://en.bitcoin.it/wiki/Script (https://en.bitcoin.it/wiki/Script)) are enabled in Bitcoin, then much of the trust issues can be solved, and anonymity won't be an issue because businesses will be able to operate relatively trust-free.  Here's a thread I started on some various solutions to trust problems that will be made possible: https://bitcointalk.org/index.php?topic=33892.0 (https://bitcointalk.org/index.php?topic=33892.0)

If extreme microtransactions can be done as well, via this method: https://bitcointalk.org/index.php?topic=25786.msg320931#msg320931 (https://bitcointalk.org/index.php?topic=25786.msg320931#msg320931), then pay-per-packet routing, and economical distributed data storage and filesharing will be some other "killer apps".  If this requires breaking the existing protocol, then I've described a way to quickly and smoothly roll out the new one here: https://bitcointalk.org/index.php?topic=34360.0 (https://bitcointalk.org/index.php?topic=34360.0).

Another "killer app" described by that thread is backing for new digital currencies that offer features that Bitcoin doesn't - e.g. user friendly anonymity, extreme microtransactions, etc. - since there can't be any effective capital controls on the exchange between free digital currencies, like Bitcoin, to threaten the promise of convertibility.  Thus, centralization of complementary currencies becomes much less of a show stopper, especially considering the potential for distributing and eliminating trust via Bitcoin's future transaction scripts.

So if I were 007, I might want to make darn sure both 'M' and 'Q' were fully on board with the rollout timetable so I could take care of any minor glitches along the lines my license might suit me to apply myself with due diligence to, in due time to keep the timetable from resulting in any more undesired collateral damage than glitches falling into such a category might insist upon absolutely requiring.

Even if I were not 007, I might sometimes wish simplemachines (and phpBB too if it too doesn't do it) would tooltip internal URLs such as thread and post URLs so I don't have to force firefox through the seemingly excruciating labour of dredging up enough resources to fire up yet another tab or window and actually display its contents just so I can better divine what that missing tooltip would've told me had it existed.

-MarkM- (tl;dr Anonymity: not a toy?)

Well that was creative.

I am not sure this is true.

I agree.  I'd change it to: It's very hard to start a business that can fairly compete with the oligarchs in the United States without doing something illegal.

In Canada there are some real pain in the ass laws for certain businesses. But for the most part you can just start up a sole proprietorship and make sure you collect taxes and remit them properly and that is it.

However I too wish there was a way to get mass anonymous investment from thousands of people on the internet. Sure there are tons of trust issues, and moral issues with taking investment from drug cartels... but really it would sure be a good way for people to micro invest in dozens of things at once. Surely one of them ends up being successful?

Then again with bitcoins track record, they will mostly be fraud or total ineptitude.

Go to Google News. Type in "lemonade stand" in the search box. Read until you weep.

So foolish local govt's shaking down kids = you cant start a business without doing something illegal?

Turn off the talk radio, and start working on your business idea, and I think you will find during the research that it isn't all that hard to do here in the USA.

The one thing I find interesting is that the OP doesn't want people to do 'unethical' things, only 'illegal' things.

Ethics are individual edicts, they change from person to person... laws apply to all.

I have done the research, and then some. It's impossible to run a legitimate business without being 100% completely in the black market, paradoxical as that sounds. In the so-called "legal" market, there are third parties who will occasionally require you to screw over a customer, or require you to be screwed over by a customer.

That's right up there with the biggest healthcare system in the US, the coffee can at the gas station.

+1 -> See:

Bitcoin: A New Commodity Created To Serve Market Demand
http://tinyurl.com/3e85xr8

We are all for a quality airtight bitcoin verification system for gaming companies like ourselves but we are too busy ATM to conceptualize the project. Hopefully someone from the community will sooner then later.

So to avoid having shitty over-regulation where young children are harassed while running lemonade stands, you throw the baby out with the bathwater and would advocate a system that makes something like the MyBitcoin fiasco possible instead?

Regulation doesn't have to be an all-or-nothing thing, and unless it was for something I needed/wanted that wasn't strictly-speaking legal where I lived, I sure as shit wouldn't do business with an anonymous "business".

It's not that hard to properly start a business in the US.  I've operated as a sole proprietor in the past. I had a business license, a Dun and Bradstreet rating, a registered fictitious name published in local newspapers, a registered US trademark, a liability policy, a sales tax account, and a workmans' compensation policy.  I paid local, state, and federal taxes.  I accepted credit cards, using a major bank.  No big deal.  I ended up selling the technology to a bigger company and got out of the retail end.

Local chambers of commerce usually have a how-to guide for your local jurisdiction, with all the forms you need. Much of what needs to be done can be done on line. It's just not that hard.

The "anonymous Bitcoin companies" currently active seem to have trouble running for a few months without ripping off their customers.  Anonymous businesses are a problem, not a solution.

Agreed, there is a ton of bullshit in this thread.

Yes, regulations and red tape are shitty. But anyone can still easily run a business with minimum of fuss. Socialist countries have FAR more regulations than the US.

The worst problem of doing business in the US is not regulations but the threat of getting sued. US litigation culture is a complete fucking joke.

Agree... Yes running a business requires some work... but I have never had or know of anyone who had to turn to illegal means to do so.


Yes the OP has no idea the red tape to setup businesses in Europe... no idea.

...and we will never have real Tort reform if we keep electing lawyers into office.


edit: the more I think about this post... is it possible the OP doesn't know the definitions of illegal and ethical?

I'm advocating getting rid of the system that FORCES fiascos like this to occur. If there was a choice, I'd rather choose a scenario where it was possible to get ripped off than your system where it's guaranteed.

Exactly. The number of regulations preventing individuals from doing very basic things to earn a living (like running a taxi, doing anything involving finance, etc.), is ludicrous. It is irrelevant that legally starting a business is only a matter of filling out some paper work. What matters is that just about anything a single person can do to earn a living is so burdened with regulations as to be impossible.

lol. It is very easy to make a business that is ethical. For instance, I could buy some marijuana seeds, grow some marijuana plants, and sell the marijuana for a profit. After establishing this perfectly legitimate and ethical business, I would be imprisoned.

Perhaps you've never actually tried to think of starting a business. If you do, you'll realize how huge the regulatory hurdles are for almost all businesses you could make. Another possibility is that your mind is so warped by the government and the status quo that you dismiss illegal business ideas without even realizing that they are perfectly ethical and only illegal because the government is corrupt.

Also, you're right that I don't know anything about regulation in Europe. I'm willing to believe it's even worse than the US.

OMFG!

http://www.thedailyquarterly.com/articles/wp-content/uploads/2011/07/LemonadeStand-215x300.jpg

But this did give me an idea of building custom Lemonade Stands out of reclaimed barn wood and selling them on/through TOR, accepting only Bitcoin for them.

What IRL parallel to MyBitcoin do you have in mind? Where has regulation forced a company to rip people off? We've been in business about three years using our current brand, and I've never been compelled by the long arm of the law to rip anyone off.

I feel like you're referencing some event that you consider to be obvious, but that isn't to many of us... care to elaborate?

Also haha @ Astrohacker's description of a pot grow-op as a "legitimate business". I'm against prohibition, but "legitimate" isn't a word I'd use to describe such a business. As far as the other stuff (financial services etc), again... throwing the baby out with the bathwater.

That could be it, certainly.

How much has Lloyd's of London quoted prospective exchanges for deposit insurance on deposits?

If the insurance companies aren't quoting insane rates that would make a legitimate exchange economically unfeasible, maybe the example we are all meant to think of is setting up open source exchange software on a laptop to run wherever we happen to be as a roving webserver so we always have our customer's deposits right within our reach, showing that app to the licensing people and asking for a licence to operate such a business, and... presumably it is thought that we would find we are not in fact permitted to operate such a business?

I dunno, it seems to me if you need to be anonymous you are maybe in a war, and if your opponent(s) in that war are not anonymous they might be stupid to imagine you are not going to kill them at the first opportunity since as the weaker side in a war taking prisoners might not be practical - one is, in effect, a prisoner already, in protective custody of oneself...

-MarkM-

Ahh... it is coming clear... so ethical... sure for some people it would be an ethical business. It would not be legitimate however.... a legitimate business cannot run afoul of laws in your area.

Look... are the US drug laws stupid? Yes... they train more criminals than any other system on earth (that is putting drug users in prison with real criminals). Here is the thing... you can get this changed. Get involved in the legalization efforts. You might not realize this but in the US alcohol was made illegal and then that law was repealed... if enough of the population wants to overturn a law, it gets overturned.

You do have an uphill battle with marijuana however as the big pharma, alcohol, and tobacco guys work pretty hard at keeping it illegal to keep it from competing.... but I suspect it will be legal nationwide within 5 years.


Have started several and still run one... turn off the talk radio and faux news and learn to think for yourself.

drug solution

tor hidden service
when someone buys the drugs, you go deaddrop them
tell where you dropped them off, that way you can not be caught, unless you get caught dropping it off

I believe we should be able to grow any plant or consume any substance that is reasonable, assuming it does not harm the environment or others. the bs government can go fuck their self before i change my mind.

Legal prescription drugs like those to treat AIDS would benefit from a privacy based currency. In fact, there are many aspects of one's life that would benefit from a little more privacy on the financial side. I'm tired of the whole credit rating Big Brother judging me. Who are they to say what I do makes me acceptable to employers or anyone else they want to sell my private information to?

Very nice post, OP. I agree with your thought, bitcoin is a great tool to ignore state threats.

Some hurdles remain though. Besides trust issues, which I think can be solved, there is the fact that you can't scale. I mean, you can't possibly manage an anonymous company with 100+ staff without being caught.

There enters another advantage of bitcoins: its ability to cross borders easily. If your anonymous company grows enough, and what you're doing is not illegal in the entire fucking planet, then start a registered company on a tax haven with easier regulations and use it as base for everything you do, (not) paying your taxes there. If you need to hire people on more authoritarian places due to lack of manpower in the tax haven, create contractors in these authoritarian countries that would have a budget as small as you need in order to have those employees there, and register these firms as "generic software developers" or something, nothing that would be blatantly illegal. Or really hire true contractors, if you prefer.
Companies today have a hard time doing this because, if they want to have clients in a certain country, they have to receive state money from that country, and for that they'll have to comply with all taxes and regulations of that government.

So I presume the obvious solution to MyBitcoin would be for its risk to be externalized upon taxpayers by undercapitalized federally mandated deposit insurance managed by people with no skin in the game, and blatant conflicts of interest?

Or how about this:
bitcoinjs.org (http://bitcoinjs.org) (specifically, the Webcoin project being built using the bitcoinJS libraries)
http://www.youtube.com/watch?v=3yoduTFjZW4 (http://www.youtube.com/watch?v=3yoduTFjZW4)

This will allow for a web-based wallet service to never have the ability to spend or lose your coins, and the only added responsibility on your part is to keep one single, never changing, rarely used key safe (print it out, and store it safely offline!), and only dig it out when you need to enable a new device to access your wallet.

So much more is possible nowadays than was possible in the early 1900s.  Be a little more creative...

along the same lines as what falkvinge described: http://falkvinge.net/2011/06/16/bitcoins-four-drivers-part-one-unlawful-trade

what would some of these anonymous businesses be? so far i see lemonade stand (not really much profit and/or doesn't scale) and silk road (not something i care to become involved in), but little in between (hard to be an anonymous taxi service).

i can think of a few more though:

toilets - in the u.s., congressman rand paul isn't the only one unhappy with his toilet.  either you buy something that won't work very well or you pay double, triple or more to get a state of the art model that work nearly as well as the ones sold in other countries.  though i don't know how you would ship something like that anonymously.

light bulbs - same thing as above: outlaw light bulbs and only outlaws will have light bulbs.

tobacco road - like silk road but for items that are legal (e.g. cigarettes) but shipped in a manner that would not please the tax collectors

foakleys - fake (imitations) of brand name items such as oakley sunglasses and coach handbags.  they might raid t-shirt shops for these because they have a physical location and an inventory to seize.  but chasing down anonymous online sellers is another matter and there probably are other priorities that matter more.

for more ideas, there is ebay's prohibited list: http://pages.ebay.com/help/policies/items-ov.html

You may not see it, but these folks were able to scale the lemonade stand concept:


http://cdn2-b.examiner.com/sites/default/files/styles/image_full_width/hash/44/aa/44aacc965e52c09dc33320d80df56756.JPG


They just need to add one more twist--accept Bitcoin.


For the past couple days, I've been kicking around the idea of a protobite, first deep-fried Bitcoin. NO YOKE!

Why wouldnt you do business with an anonymous one?

What would one look like?
-No main office building...workers would work from home and be unemployed(or dont want to 'work') in govt statistics
-Probably some hybrids that offer the normal economy but also supply the shadow economy

I keep on harping about a confidential social network that would verify the trustworthiness of the business. Now at least I can show what kinda of what it would look like since lorea.org put it together.... https://n-1.cc/

You would have competing social groups vying for trust. So the anonymous business would be part of the 'Better Business" group and if it was a currency exchange also part of the 'Forex' group for example. Not to mention there could be like/dislike and feedback.

Granted, this only works in mass if the government cracks. Its dependent on less government spending, aka the elimination of government goons. I'll put it this way, if the US goes third world, you are going to want to deal with an anonymous business since not only will the businesses go unchecked, but the government unchecked as well.

It's been tried. See Citysearch, Yelp, WOT, etc. If the raters are anonymous, the system will be spammed. If the ratings influence search results, the system will be spammed very heavily.  See any black hat SEO forum for details.