What will the state do?

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In the UK, if they laugh at you then you're definitely on to a good thing. Hey look, David Cameron finally worked out people were talking about him on Twitter.

More likely, (here at least) we'll see an attack along the usual line of "anonymity is bad because we can't know you're not morally suspicious" while forgetting that most people are morally suspicious because being morally unsuspicious just means doing what the government want you to do. Hence a Treasury Minister attacking cash.

I guess it's actually in the interests of the state to declare Bitcoin as legal tender. Then they can regulate anyone accepting Bitcoins as formal entities - selling something for Bitcoins would require you to register as a company and file tax returns. Accepting donations might require you to register as a charity, etc.

That's probably a good thing in terms of getting Bitcoin "accepted" rather than clamped down on.

[FlipPro]

If bitcoin takes hold how are they going to able to fund their police state or military industrial complex to go after bitcoin ?

If they were really all powerful the silk road wouldnt be out there giving them the finger right now  

Sales Tax on merchant nodes, property tax, luxury tax, capital gains taxes (enforced by exchangers), and a variety of other ways they can tax you (EVEN WITH Bitcoin)....

People who are serious about Bitcoin need to stop saying that they aren't going to be paying any taxes...

I will admit that it will be much more difficult for a state authority to abuse a system like Bitcoin, but saying we're not paying taxes!

It sends the wrong message, and only shows you are living in pure fantasy land when you say "they can't touch me", when really they can...

[fm1234]

posted by nobbynobbynoob:

posted by SpiralNihlo:

If states attack bitcoin they're likely to shutdown the exchanges first as that's the easiest and most obvious thing to do if you are a state.

The irony is, they'll be showing all their totalitarian colours doing this.

Unfortunately that will be just plain ok with the mainstream.   That is precisely what the US government did with online sportsbooks, and despite some minor protests and sabre-rattling, no one really gave much of a shit or did anything about it.  Same with US digital currency exchangers, which is why there are so few of them despite the relative ease of getting an MSB licence.   

Really, the BTC<->USD conduit is and always will be the weak point in the Bitcoin idea.  As long as there is a significant need to move from one to the other, shutting down the BTC economy will be as simple as shutting off a light switch, which is why so few people in the USG know or care about Bitcoin.   As with digital gold, as with sportsbooks, the day the government decides that it might be a good idea to clamp it down, the first shot will always be to scatter the roaches by shutting off the USD spigot at the banking end of things.   


Frank

[justusranvier]

Really, the BTC<->USD conduit is and always will be the weak point in the Bitcoin idea.  As long as there is a significant need to move from one to the other, shutting down the BTC economy will be as simple as shutting off a light switch

The window of opportunity to do this lasts until there are enough things available for sale for Bitcoins that converting them to USD is no longer necessary.

[nobbynobbynoob]

Really, the BTC<->USD conduit is and always will be the weak point in the Bitcoin idea.  As long as there is a significant need to move from one to the other, shutting down the BTC economy will be as simple as shutting off a light switch

The window of opportunity to do this lasts until there are enough things available for sale for Bitcoins that converting them to USD is no longer necessary.

+1

Frank Braun was recently pointing this out on the Max Keiser Report on RT (it's on YouTube, and at about 14 minutes into the video, Max talks about "someone" who suggested the world becoming like East Germany - Max, that "someone" was me! )

[Come-from-Beyond]

What will the state do?

Everything it is able to do.

[FactoredPrimes]

I think that once those in power realize how handy bitcoin is for bribes, kickbacks and hidden contributions they will embrace it and protect it.

[fm1234]

posted by AbelsFire:

posted by fm1234:

Really, the BTC<->USD conduit is and always will be the weak point in the Bitcoin idea.  As long as there is a significant need to move from one to the other, shutting down the BTC economy will be as simple as shutting off a light switch

The window of opportunity to do this lasts until there are enough things available for sale for Bitcoins that converting them to USD is no longer necessary.

In theory, yes; however, it should be noted that at the time of their respective shut downs, this was true of both the Liberty Dollar and e-gold.   

One could buy virtually anything online with e-gold, pay bills online, send payments to and receive payments from non-users of e-gold, etc.  Being largely offline the LD worked a little differently, but there were entire communities where it had a strong and sometimes almost universal acceptance.   Both rolled up and vanished practically overnight, as if they never happened.   The Liberty Dollar was referred to on record as a "unique form of domestic terrorism," and not one person outside of the LD userbase batted an eyelash or wondered how on earth minting and using silver coins could be a form of terrorism.   e-gold was shut down and its founders and officers barely escaped prison time, on the basis that a vast amount of criminal activity was occurring within the system; four years later, if even a single criminal has been brought to justice as a result of the multi-year, multi-million dollar investigation, the state is suprisingly quiet about it.   

Like a light switch.   So, while it is theoretically true that the weak link could be eliminated, it is not at all certain that it will be -- despite having certainly been possible in other cases, the critical "tipping point" just never occurred. 


Frank 

[misterbigg]

Taxation is theft.

[Come-from-Beyond]

Taxation is theft.

We still should pay taxes to help ppl with limited abilities.

[nobbynobbynoob]

Taxation is theft.

Robbery even.

[FreeMoney]

State 'thinking':

This new thingamacurrency will empower people to ignore our dictates. Lets write some more dictates.

[justusranvier]

In theory, yes; however, it should be noted that at the time of their respective shut downs, this was true of both the Liberty Dollar and e-gold.   

One could buy virtually anything online with e-gold, pay bills online, send payments to and receive payments from non-users of e-gold, etc.  Being largely offline the LD worked a little differently, but there were entire communities where it had a strong and sometimes almost universal acceptance.   Both rolled up and vanished practically overnight, as if they never happened.   The Liberty Dollar was referred to on record as a "unique form of domestic terrorism," and not one person outside of the LD userbase batted an eyelash or wondered how on earth minting and using silver coins could be a form of terrorism.   e-gold was shut down and its founders and officers barely escaped prison time, on the basis that a vast amount of criminal activity was occurring within the system; four years later, if even a single criminal has been brought to justice as a result of the multi-year, multi-million dollar investigation, the state is suprisingly quiet about it.

I don't think either one had the international reach Bitcoin has.

If the United States bans Bitcoin they can't stop me from using it to pay for VPN service from a provider in Europe. If they also convince EU countries to ban Bitcoin the service can move to any part of the world that's not banning it yet.

Once the critical mass of commerce is reached there won't be any practical way of shutting it down besides turning off the Internet entirely.

[asdf]

Taxation is theft.

We still should pay taxes to help ppl with limited abilities.

If you see a person with limited abilities who is in need, just pull out a gun and point it at the 5 nearest fully abled people and demand the cash in their pockets. Then give that money the the limited ability person and send the fully able people on their way. problem = solved.

[SgtSpike]

Taxation is theft.

We still should pay taxes to help ppl with limited abilities.

I am all for helping people with limited abilities, but it should be voluntary, not forced.

[fm1234]

posted by AbelsFire:

I don't think either one had the international reach Bitcoin has.

If the United States bans Bitcoin they can't stop me from using it to pay for VPN service from a provider in Europe. If they also convince EU countries to ban Bitcoin the service can move to any part of the world that's not banning it yet.

Once the critical mass of commerce is reached there won't be any practical way of shutting it down besides turning off the Internet entirely.

Decentralisation is BTC's strong suit, to be sure.   It is not without its chinks, and if it is too problematic to try to contain then the "gateways" (exchangers and the like) will be the pressure point -- which circles back to my original statement, that these gateways will always be a weak point.    My point about broad implementation was merely that it didn't serve as any kind of an aegis for regular users of the LD and e-gold.


Frank

[Roger_Murdock]

It's a sure bet that a majority of the people working in the Federal system have no idea how bitcoin works, assuming they've even heard of it. Bitcoin's strength is that it's an idea first and foremost and a currency/commodity second. Ideas aren't valued in the upper realms of American "culture" anymore since only the $$ signs matter.

Of the small percentage that work on the Fed Farm that do understand bitcoin, I'd also bet that at least some of them actually LIKE the idea. If you're smart enough to grasp how bitcoin works, you're also smart enough to know why the current economic system won't work anymore.

I think this raises an interesting question. We often talk about "the state" as though it's a single conscious entity. Of course, "the state" is really a fiction. It's just a bunch of smaller organizations, and those organizations are really just a bunch of people. And the same is true of the corporations / banks / financial elite that control the state. Bitcoin is on the radar of at least some of those people.  But which ones? And which ones see it as a threat?  And which ones really understand the enormity of that threat?  In other words, which ones recognize that Bitcoin is not just a way to "launder money" -- it's a way to replace money?  And as you pointed out, if they really understand Bitcoin doesn't that mean that they're also likely to understand how corrupt and broken our current monetary system is, making them likely supporters? (To know Bitcoin is to love Bitcoin, right?) How do you see the decision to attack Bitcoin being made? At what point? By whom?  It would be interesting to know how the decision was made to go after e-Gold and the Liberty Dollar.  

And (sort of related), this is why I have somewhat conflicting feelings about the Bitcoin Foundation. And part of me is astonished that the developers aren't all, like Satoshi, maintaining their anonymity. Don't they realize how subversive Bitcoin is?! Don't they realize the threat it represents to the defenders of the status quo? But on the other hand, I also think, well of course they don't need to be anonymous. They're not doing anything wrong or illegal.  And there's something to be said for self-fulfilling prophecies. If you expect others to view you as a threat (and act accordingly), they're much more likely to view you as a threat.  If you expect acceptance, you're more likely to receive it.

Thoughts?

[FreeMoney]

It's a sure bet that a majority of the people working in the Federal system have no idea how bitcoin works, assuming they've even heard of it. Bitcoin's strength is that it's an idea first and foremost and a currency/commodity second. Ideas aren't valued in the upper realms of American "culture" anymore since only the $$ signs matter.

Of the small percentage that work on the Fed Farm that do understand bitcoin, I'd also bet that at least some of them actually LIKE the idea. If you're smart enough to grasp how bitcoin works, you're also smart enough to know why the current economic system won't work anymore.

I think this raises an interesting question. We often talk about "the state" as though it's a single conscious entity. Of course, "the state" is really a fiction. It's just a bunch of smaller organizations, and those organizations are really just a bunch of people. And the same is true of the corporations / banks / financial elite that control the state. Bitcoin is on the radar of at least some of those people.  But which ones? And which ones see it as a threat?  And which ones really understand the enormity of that threat?  In other words, which ones recognize that Bitcoin is not just a way to "launder money" -- it's a way to replace money?  And as you pointed out, if they really understand Bitcoin doesn't that mean that they're also likely to understand how corrupt and broken our current monetary system is, making them likely supporters? (To know Bitcoin is to love Bitcoin, right?) How do you see the decision to attack Bitcoin being made? At what point? By whom?  It would be interesting to know how the decision was made to go after e-Gold and the Liberty Dollar.  

And (sort of related), this is why I have somewhat conflicting feelings about the Bitcoin Foundation. And part of me is astonished that the developers aren't all, like Satoshi, maintaining their anonymity. Don't they realize how subversive Bitcoin is?! Don't they realize the threat it represents to the defenders of the status quo? But on the other hand, I also think, well of course they don't need to be anonymous. They're not doing anything wrong or illegal.  And there's something to be said for self-fulfilling prophecies. If you expect others to view you as a threat (and act accordingly), they're much more likely to view you as a threat.  If you expect acceptance, you're more likely to receive it.

Thoughts?

Most of "the state" (smaller orgs and individuals) take dollar dominance completely for granted. They can't mobilize against an impossibility. Likely a few sub-state orgs do fully understand, but they can't get much cooperation on a big mission without starting a panic themselves. It would be like shouting that there is a mouse in the movie theater. No one listens to you probably, but maybe you can make the mouse sound super-powerful and evil but if you succeed you've mostly convinced people that you do not have the situation in hand.

[becoin]

Bitcoin is not decentralized. It is actually very centralized. Bitcoin is not just the network and the protocol. Bitcoin is also about mining. A coordinated action in just 24 hours can shut down a dozen mining pools and that will be the end. In the original paper Satoshi talked about CPU mining, not GPU mining. Technically the weakest point is not the exchangers but centralization of mining activity!

[nobbynobbynoob]

Won't killing off mining operations, if indeed that's possible, just serve to revalue the existing 10 million plus BTC already in circulation?