I'm no lawyer (although I do work in the field of legal compliance and I deal with federal regulations often), so take what I say with a grain of salt. I highly doubt that the SEC would pass regulations that made it illegal to participate in ICOs outright, but it may create a regulatory framework so complex that it makes sense for ICO administrators to ban US citizens/residents from participation.

If they did make it illegal for US citizens to participate at all, I very much doubt there would be any retroactive repercussions. I think this is the case especially because of their recent decision, which basically said to US investors, "We're being pretty hands-off. Be careful."

When I got into Bitcoin in late 2013, I felt like I had missed the boat, too. So I chased litecoin, because it was cheaper. I got over that silly line of thinking within a few months as I got more engrossed with the technology and realized that bitcoins, not shitcoins, were the future.

The fact is that the price doesn't matter. I think we all know where this is headed in the long term. There's no reason to push this "Let's move to mBTC or Bits or Satoshis" line of thinking unless you're trying to accelerate the process through marketing.

I'm not here to get rich quick, though, so I have no interest in pulling these marketing gimmicks to attract people that aren't interested enough in the technology to distinguish Bitcoin from other cryptocurrencies.

Caveat emptor. In the SEC's recent decision, they indeed said that ERC tokens can constitute securities, so I imagine that some ICO administrators are moving to restrict participation from US citizens. In the exchange world, enforcing such by IP restriction is usually seen as "good enough."

Between that and the fact that it's still pretty much the wild west (the SEC also chose not pursue any charges against anyone for anything), I'd say that your chances of recovery in a scam are low. So, buyer beware. There's money to be made in the ICO craze for sure, but there are many over-inflated promises and hyped expectations as well.

My Ukrainian friend (who is somewhat active in Russian-speaking forums) seems to be under the impression that they may be able to coordinate fiat payments through services like Yandex and WebMoney. Not sure how that could work given that Yandex is a publicly traded company.

Maybe another convoluted web of shell companies processing fiat through third parties (like online poker companies) is possible, given that it would probably take at least a year or two before the US government could set up another similar operation. Maybe next time, they'd be better prepared.

It's certainly not 100% clear yet, but it seems like that's the case. One consideration is that with multi-tiered verification, some whales may be effectively stuck and decide to provide liquidity rather than leave the stuck funds sitting.

I remember thinking the same thing at Bitfinex -- who would sell their coins there? But whether through the exchange manipulating, deals with whales, etc., maybe there is some similar outcome here (at least in the short to mid term). Given the ICO craze and the Bitfinex recovery, there are still a lot of "greater fools", so to speak.

Zcash is pretty lame since no one uses anonymous transactions. As such, your privacy isn't protected by using them. I don't know much about Dash, but I have heard very promising things about Monero's privacy features. That would be my top choice for now.

I think that VPN/TOR and mixing through non-KYC services might be enough if it weren't for the centralized nature of the darknet markets themselves. They can give away all sorts of metadata critical to law enforcement, on top of being honeypots, and you have to trust that the admins are taking precautions to encrypt properly.

So, we need decentralized exchanges, decentralized darknet markets, trustless mixing (Tumblebit)... I wonder how long it will take to get there.

I think you'll find that most bitcoiners oppose proof-of-stake. Has there been shown to be a viable proof-of-stake model as a proof-of-concept, let alone at scale? I haven't even seen a whitepaper that was altogether convincing, and that didn't make grand assumptions about the incentive model underlying PoS.

For now, PoW has been shown to work. Even facing a majority of rogue miners, I think that most bitcoiners would prefer to switch PoW algorithm and continue trying to address mining centralization than to go the route of PoS.

Fungibility is definitely becoming a problem as all these blockchain analysis companies are taking off. Tracking peoples' bitcoins is much, much more sophisticated today than it was a few years ago. I really can't wait for a working TumbleBit hub. Apparently, it's a uni-directional unlinkable payment hub, and it's fully compatible with today's Bitcoin protocol.

On Stratis, TumbleBit has just been integrated into the Breeze wallet for added privacy. Can't wait to see this happen for Bitcoin.

No, not BitShares. Bitsquare: https://twitter.com/bitsquare

It's an open-source desktop app that allows you to trade without third party risk. You can't get anywhere near the liquidity and order matching capabilities of centralized exchanges with it, though. I just googled them and they just re-branded to "Bisq" within the last month, apparently.

It's more complex than that. One potential issue is geographic centralization, particularly as it relates to national boundaries. The vast majority of global hashpower (something like 70%) is controlled by Chinese mining pools. Let's ignore for the moment the possibility of miner collusion to commit selfish mining or 51% attacks, or that Bitmain itself might control a majority of all hashpower.

The issue I'm pointing out is that having so much hashpower under one national jurisdiction means it could all be shut down quickly by one national government. That could cause massive and prolonged network disruption if difficulty were to drop that way. It would be far better for hashpower to be geographically decentralized.

Sure, that's believable. I never really thought about that, since the obvious choice for law enforcement is to operate a darknet market as a honeypot (like Hansa)--lots of data given away there even with the best operational security by vendors. But a mixing service would be useful, too, for catching the low-hanging fruit. For proper security, it would make sense for mixing to be only one step in a multi-step process (perhaps also using non-KYC services through TOR/VPN).

Doesn't really explain why the owner left the way they did, but you raise a good point...

Well, there is Bitsquare. In time, we will have better ways -- atomic cross-chain swaps and such. But there is no fundamental answer to the problem of hedging bitcoin (or altcoins) against fiat currencies. There's no way to do that without a trusted third party somewhere in the chain. Pegs (like "price floor contracts" which are untenable anyway) require storing funds on exchanges. Tether = Bitfinex. For now, all we want is coin, but there will come another time like 2014 where USD will be king again.

Given that TumbleBit is an anonymous protocol that is fully compatible with today's Bitcoin protocol, I wonder why it hasn't taken off yet. Was I mistaken, and it required Segwit or something? I've been wondering how TumbleBit will measure up vs. centralized mixers, in terms of liquidity for mixing, reliability, and usability. It seems like bitcoin mixers are active as ever, though, in the wake of Bitmixer shutting down.

Same liquidity, same back end. I believe all xbtce users needed to verify; that was one of the key differences. Different front end (although not by much, and even a trollbox, too). Regardless of anything their affiliation with BTC-e is very difficult to deny, so I'd be nervous holding any funds there. In fact, at this point, I'd be nervous holding funds on any exchange that has been serving US customers without proper licensing (i.e. Bitfinex, Kraken, etc).

How can the two be compared, or put in the same basket? Core has avoided contention, continued to scale Bitcoin tremendously, and pushed for changes in a slow, responsible and methodical way. The NYA signatories are just profit-motivated business interests -- businesses and miners that want a hard fork for profit motive, not for the good of Bitcoin.


All these fork threats just harden my resolve to hold. Worst comes to worst, I'll support the wrong coin, but I'll have coins on the fork that takes the throne.

It's simply impossible to implement from a decentralized perspective. If we want to transition to a decentralized cryptocurrency, we need to drop this mindset where fiat has any relevance. From a protocol perspective, it simply can't.


That's what small blockers have been saying from the start. Either a fee market develops based on limited capacity, or inflation needs to increase. Otherwise there is no incentive to secure it from a mining perspective past a certain point...

Yes, in addition to requiring some form of centralization to peg fees to USD within the client, it doesn't fit with miner incentives. Like investors, miners are investing into bitcoins, and transaction fees are increasingly important to miners as block subsidy continues to drop. Based on network effect, if you expect the price of BTC to rise, you can expect the cost of fees to rise as well. That's baked into the protocol, and it's great incentive for miners to secure our transactions.

This is the clearest explanation for why no taxable event has occurred. You can't realize gains if you haven't even acknowledged the receipt of an asset. And most precisely, an airdrop/giveaway seems to most appropriately be seen as a "gift." Gifts are not taxable in the US. Rather, the donor of a gift may incur tax liabilities by giving to others. But the mere act of receiving a gift (and not realizing any capital gains on that gift) should not trigger any taxable event. Not an attorney, but the OP makes no sense to me.

That seems ideal, and I think most Bitcoin users are incentivized to work towards that. Unfortunately, what's happening is that entrenched business and mining interests are pushing for their own profits, rather than for user interests. As these interests diverge further and further, a split becomes more likely.

The Bitcoin Cash split was a relative non-event. Not much hash power or wallet support, and very little support from Bitcoin businesses. The November fork has a lot more support (not from developers or users, per se, but from business and mining interests), so it should be more interesting to see what happens then.

There's no decentralized way to code fees into the protocol based on interfacing with an external service (like pinging an exchange to get the current price). If a protocol did this, it would only take that service being compromised to disrupt the entire network. I don't think there is a way to do this with a native blockchain currency. The idea suffers from the same problems as "pegged" cryptocurrencies. At some point, centralization is required.