Bitcoin Forum

If they outlawed Bitcoin, we would just change to name to BitMoney.
In order for the government to effectively outlaw bitcoin, they would have to outlaw the exchanging of encrypted numerical data. Nothing short of this, could effect bitcoin, legally.

Many people think of bitcoins as something semi tangible, but since it's nothing more than encrypted numbers, to outlaw bitcoin is to outlaw computers. Completely impossible.

Any attempt to legislate anything referring to the term bitcoin, would mean we have to call it botcoin, or bitmoney, or bitcents, etc etc. Then it becomes pointless for them to even try.

Anyone care to explain here just how a government can attempt to outlaw bitcoin?

Exactly, the term bitcoin only exists on the open source client and can be changed as fast as it can be re-compiled. In fact, it will. See my post:
https://bitcointalk.org/index.php?topic=36662.msg450946#msg450946

By outlawing the use of the concept rather than any particular implementation of it.

The law and associated penalties would only need be harsh enough to destroy market confidence.  It wouldn't take that much.

I think the theory is that the governments will collude and force all supporting sites to shut down.  What happens when you are no longer to move money into and out of an exchange?  I know the long term hope is that we no longer will need exchanges, but I think it's a required mid term step.

I read this article about egold and it scared me.   http://www.wired.com/threatlevel/2009/06/e-gold/

if I follow your reasoning, in order for the government to effectively outlaw violence, they would have to outlaw the exchange of kinetic energy ?

Just look at money laundry laws, many of them apply to Bitcoin unmodified. Any exchange or barter of valuable assets (gold, diamonds, currency, real estate, casino chips etc.) is money laundry if done with the purpose of misrepresenting the source or destination of wealth.

Since Bitcoin transfers shield the sender and the receiver from each other, they fit by default the broad definition of money laundry. It's easy to target any on-line shop or non-shady exchange. They could discourage the wast majority of US based shops from accepting Bitcoins by merely posting a message on the IRS site that accepting such payments without complying to know-your-customer is illegal. Nobody fancies a trip to "pound me in the ass" land for the sake of a few extra customers.

Would that destroy the concept of distributed currency ? I don't think so, but yet again, what good is an electronic currency that can't be used legally online ? It may still be significant for potheads, traffickers and other persons dealing in the black market, but not for most regular people.

Which government?

^^ This! +1

They already outlaw intentional aggravated application of Newton's Third Law of Motion to people's bodies.

They could outlaw the use of "cryptographic peer-to-peer currency."

But I won't stop using it.

GOVERNMENT CAN DO WHATEVER IT WANTS

for real. unfortunately.

Exactly

Well it looks like they'd just have to go right down the path to censoring the internet. But don't hold your breath!

They can outlaw whatever they want, it doesn't mean people will stop doing the illegal activity, just makes it more fun ;)
 
See:  speeding, under-aged drinking, smoking pot, and sex with prostitutes

Don't discount the ability of a government to create poorly-phrased, ambiguous, and generally unenforceable laws.

Something like:


1) all transactions must be denominated in and carried out using our legal tender

2)  anyone doing fx or any international trade  must be licensed,   and per the terms of the license only approved units of trade may be used.

It's interesting how we came to the current financial system in the first place. I hate to use the "Tea Party" analogy, but The People did not create fractional reserve banking, nor establish a private bank to manage the US Treasury. They failed and bitcoin evolved. The genie is out of the bottle and bitcoin will flourish awhile until something comes along to restrict it, but that time is a long way off.

The one that shut down ThePirateBay.org.

America is a nation of the people, by the people. If your president are going to ban bitcoin, just go to the street and vote another candidate who are for bitcoin.

Bitcoin transactions will be added to the taxcode at some point.

... With 1 election every 4 years its not very easy to do.

Not to mention most candidates ride the fence to get elected and then do what they want anyway (congress or the pres), or do whatever lobbyist pays the most money asks for ;)

(edited)

Likely it'll be treated the same as any other foreign currency: you pay taxes on your profits when you convert them into your home country currency. (I suspect it should be treated like that already, especially if your profits are HUGE, and you want to stay safe and avoid IRS audits and jail)

LOL!!!

You must have read these United States' Constitution and thought that it had anything to do with our government.

Government is now of the corporations, by the corporations. And whichever corporations can spend the most on advertisements for presidential candidates which will sway the sheeple into voting for what they want wins.

See Germany circa 1940s...

You cannot outlaw the use of a concept that injures nobody.
Destroying market confidence may be almost impossible as well, because no matter what anyone says, i'll always have bitcoins if I choose liberty over security.

In order to shut down all supporting sites, they would have to force foreign governments to work for them, to do their dirty work. I don't think Antigua is getting rid of their pro gambling laws because the US government is losing business to offshore entities acting illegally against the interests of American citizens. So, they may be able to shut down Tradehill, but they cannot touch Mt Gox from the US, unless they go after Mark personally, then there are always more exchanges.

E-Gold was stored physically somewhere, was not it's own currency, since it took US deposits to convert, it could actually be considered a money laundering operation. Bitcoin is not. Your not buying something that represents currency, it's actual currency.

Violence has always been controlled by societies. People cannot be allowed to go around injuring others irresponsibly. That is a real, REAL crime. It makes no sense to compare this to bitcoins.

They did it with "gay" for a few decades/centuries, so why not?

All of these laws target something called "Financial Instruments" of the United States, that involve financial transactions.

Encrypted numbers are not even physical, so they do not actually exist, in fact.

You cannot tell people of a nation, that they cannot create their own currencies. Alternative currencies are completely LEGAL in the United States. Even less effective, is to tell the people of a nation like the US or Europe, that using encrypted numbers agreed upon by consensus, cannot be used to trade and exchange items.

I have studied law for years now. Not as a lawyer but as a freedom fighter.
One thing I know, by studying laws, is that in order to outlaw something, you have to target certain actions and tie them to something that should not be done. If I were a legislator, I would have to write the law something like this.

"It shall now be considered against the laws of the United States for any person to transmit encrypted data with the knowing and willful intention to disguise the source and destination of that data".

Nothing short of this, will outlaw bitcoin.

People are the REAL government, in fact, not fiction. Real people can do even more than government because real people make up government and real people ARE IN FACT, Government.

So, I agree, the people can do whatever we want!

Total FAIL.

Currently, it's legal to create your own alternative currency. There are 100's already throughout the US. If it was possible to outlaw them, the government would have already.

Forex is not bitcoin, again, it relates specifically to "financial instruments" and "financial transactions" which bitcoin are neither, in fact, or legally considered. And they cannot ever be considered legally "financial instruments" or "financial transactions".

Bitcoin does not sit on a server somewhere.
P2P has not gone anywhere just because Napster was taken down or PirateBay was seized.

Impossible!

You cannot add "Beanie babies" to the Tax Code and you cannot add an intangible series of numbers as a taxable issue. Taxes are charges of interest on money loaned to the people. Example, we only started the Income Tax after the Federal Reserve Act, because the tax was to collect interest on the national debt. So, so cannot take something unrelated to the economy and tax it. You can tax sales, so people selling bitcoins from their business, need to pay taxes on those sales. But bitcoins themselves cannot be taxed. People selling bitcoins to each other without businesses are not taxable sales. Just like you would not need to collect tax at a garage sale.

Good Point! But were not living in the Dark Ages anymore, either.

Bzzzttt..... wrong answer.

The fact something is legal now is irrelevant to the fact it could be made illegal later.  As a small example, consider private ownership of gold.   Now go read http://en.wikipedia.org/wiki/Executive_Order_6102  .  If they were willing to make it illegal and seize all the gold in the county, they sure as heck would have no qualms about making currently legal alternative currencies illegal.

As for your second paragraph, it says nothing.  It changes nothing  about the fact that they can make any trading outside of approved denominations illegal.  

So ...  yeah, you predicated your response right from that start.   It was total fail.

It already is in most countries...

Please cite your evidence for this, or I will assume you are bluffing. Show me where bitcoins are added to a country's tax code.

They would fall either under the barter or the capital gains codes.

It cannot be. It has to be tied to something, and it's it's own currency and value changes daily.

And yet it is.    Call up the IRS and ask them if using a different currency makes things untaxable.   How much to you want to bet on the answer?

http://www.irs.gov/businesses/small/article/0,,id=113437,00.html for example shows they want taxes dollars or not on exchanges.

Bitcoins can be printed on paper, copied, bound, copyrighted, and self-published. One could then tear out pages and transmit them. Shall we outlaw books?

Certain types of pornography is illegal. There are more types in Canada than in US. US has outlawed books with those, and there are certain types of books that you can buy in US from Japan, but is illegal to poses in Canada.
I like the claim that government can outlaw anything. Especially if it's to "save the children," and it's very easy to see how Bitcoin can be targeted with that.

Did you bother to read previous posts?  Some printed materials are outlawed,  try and print dollars even in a book form.   Or to see them really stretch the existing laws, read about the recent Liberty dollar case.

can't machines photo-read now as well??

This has become the gubbermint iz gonna gets you thread.

With that logic, so can ANYONE.

Even better solution: Engrave your bitcoin key on a bullet! You can defend your bitcoin under the 2nd Amendment, and have another nifty way to transmit it over long distances :D

(I'm actually not a gun nut, nor even own a gun, but the "gubming gonna get you" comment made me think of this)

Sorry dude but "governments" have the massive wealth and power of much smarter minds than you and me.

For instance: If I was going to destroy bitcoin for the US government: I would take all of the domains associated with this forum as well as bitcoin sources (already done against the poker sites) Then I would start up 100 to 500 different "Ixcoin" type equivalents. So one of them creates coins at 50 per block, 49 per block, 200 per block... etc etc.

Why would anyone ever buy back into or FIND the original bitcoin? How would anyone choose which blockchain to start "trusting" and exchanging and mining?

Ixcoin is a very important thing: It as an example that anyone can make a blockchain. And if everyone DID make a blockchain... they all become worthless. How could we ever choose one to get behind?

Bitcoins open source and incredible versatility, is also a huge weakness. It only has value if there is only ONE blockchain and everyone uses it together.

And this is just my method, a government would be much more cruel and untraceable.

but what if they get shot?  ::)

I call it a currency, loosely, but legally, it's NOT a currency, so the IRS cannot deal with it as such.

Pornography is illegal because it depicts actual acts taking place between people. That photo is a tangible item and can be traced and destroyed. Pornography is not illegal anyways, only child porn, and that means there has been some child victim. But to make an image of a child from scratch and show it being molested, is not against the law. So, in order to enforce child porn laws in the US, there has to have been a child victim and that photo stems from such an illegal act, so the photo can be held to be illegal as well.

How this can be applied to bitcoin is nonsensical.

Bitcoin is like the virus that infects the mainframe. In order to rid the mainframe of the virus, you must destroy the entire system.

Bitcoin rides the back of the beast, with a whip and heels with spurs.

Bitcoin is so closely tied into the basic foundation of our lives, through computers and data and privacy, that it's like a cancer that hides inside the cells and causes the production of antibodies. You have to literally kill the organ to rid the tumor.

Since Bitcoin is NOT a currency, it cannot be legislated like one. In other words, no currency laws can be applied to bitcoin. Bitcoin is the transfer of information privately, and nothing more and nothing less.

Free Speech, Computers, and Free Association, along with doing business altogether, would have to be outlawed in order to outlaw bitcoins.

Aaaactually, even drawn images are still in legal limbo in US, and the books I was talking about are certain types of manga (all drawn) that may depict a mature relationship between underage people. All drawn, no one harmed, legally questionable in US, and illegal in Canadia.

There, fixed that for you!

Government doesn't give rights and freedoms. They exist regardless of what government, if any, might exist. Government either violates them or doesn't violate them. It's amazing that people STILL misunderstand this.

I have sent 0.1 BTC to the following passphrase:

"We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America."

(which corresponds to Bitcoin address 12tw77jR3XcRusMuwHAAKUmwGUoKoWtAHT)

Let's see someone make possession or conveying this passphrase illegal.

You can't outlaw math.

Exactly!

A government such as the United States Federal and state governments might find it difficult to outlaw something like bitcoin due to its distrusted nature and it's connection to expression; but the government might choose to make it a regulated commodity trade and then refuse to license it. Although this would push it underground, and people would then trade it offshore and the like, it would simply mean that legitimate businesses couldn't use it in the US.

At least it cannot fall afoul of the US Mint's territory like Liberty Dollar did. I looked up the Liberty Dollar because it made me think of an event where an obvious non-US currency came under fire by the US Federal Government.

http://en.wikipedia.org/wiki/Liberty_Dollar#Federal_Government_response

Other countries, however, especially dictatorships will probably just declare transmitting bitcoins illegal and that will be that; it'll be contraband and while they won't be able to stop its use, they can certainly do evil things to those caught using it.

I don't see why the US government would care. To me, in a legal arena, bitcoins look like a limited commodity traded for value by social contract; they're a currency only in that people use them as a means of proposing value and they can be exchanged for USD between contracting parties. It doesn't pretend to be USD legal tender and only contracted parties need accept it as payment. Surely, it could be used for tax evasion or investment; but bitcoins themselves are not USD and don't become income until exchanged.

I'm sure someone with a lot more legal know-how will correct the hell out of me on that; but with Bitcoin being as obscure as it is at the moment, it's not going to attract a lot of attention. If and when it does, the EFF will probably be itching for a fight -- especially after they stopped taking donations in Bitcoin after citing that they expected that they didn't want a conflict of interest in a legal battle. :)

I dont understand why some find it so hard to believe that the government wouldn't just embrace it and use it's unmatched hashing power to once again regain the trust of the entire world.  ;)

hahaha, lol, lulz, LOL, your'e joking right?

Yes [sarcastic] see dead http://thepiratebay.org/ (http://thepiratebay.org/) here [/sarcastic] :D

It's censored here...

Sure, nothing stop me from using a proxy, but still it sucks