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Author Topic: Does LEGAL TENDER imply all other barter/transfer in kind is ILLEGAL TENDER?  (Read 1446 times)
cloud9
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June 02, 2011, 08:56:36 AM
 #1

http://www.bitcoinmoney.com/post/6100385027/eff-bitcoin-donation-review

A question to the EFF:

Isn't Legal Tender only the official form of payment that HAS to be accepted for the settlement of a debt in a certain jurisdiction, but not the ONLY method of barter/transfer in kind that CAN be accepted?  Isn't - I gave you a goat - you can give me six chickens in return - allowed in a barter transaction?  If I got six chickens for my goat, and I originally gave only five chickens for my goat, I suppose I will have to pay the equivalent of one chicken's worth in income/capital gains tax, in Legal Tender that has to be accepted for my tax debt to the government?  Isn't bartering/exchanging in ownership rights to cryptographic key certificates allowed, even though it is not Legal Tender used to enforce acceptance as payment method for the settlement of a debt, as long as you pay your taxes on bartering/exchange of such exclusive rights to a unique digital good? Is bitcoin just transferable ownership rights to cryptographic key certificates in the end?

Disclaimer:  Postings of Cloud9 are only individual views of opinion and/or musings and/or hypothesisses.  On a non-authoritative, peer-to-peer public forum, you do not need permission from Cloud9 to derive your own conclusions or opinions, so please do.  Calculations and assumptions to be verified.
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cloud9
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June 02, 2011, 10:34:35 AM
 #2

http://www.bitcoinmoney.com/post/6100385027/eff-bitcoin-donation-review

"... legal tender is the best way to help ..." - Is the best way, is the deduction correct that it is not the only way to help?

Disclaimer:  Postings of Cloud9 are only individual views of opinion and/or musings and/or hypothesisses.  On a non-authoritative, peer-to-peer public forum, you do not need permission from Cloud9 to derive your own conclusions or opinions, so please do.  Calculations and assumptions to be verified.
unspy
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June 10, 2011, 09:52:14 PM
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The Gov’ment has done a great job on having us think backwards.
 
The Federal Reserve Note (FRN) may be legal tender, but it has NEVER
been legally named a dollar. You will not find any law anywhere that states this.
The FRN may be denominated in dollars but this makes it no more a dollar than
calling a chicken a duck makes it a fly south in the winter.

The United States Code (12 § 411) provides that FRNs "shall be redeemed in
lawful money on demand at the Treasury Department of the United States or
at any Federal Reserve bank.” Thus, FRNs are not themselves "lawful money"
otherwise, they would not be "redeemable in lawful money.”

Legal Tender Laws make us use something for money even if something else
may be better (like Bitcoin for example). It is a very important point that
Legal Tender Laws are always found where Fiat Money is being used.
In other words, whenever governments have DECLARED that this and
only this can be used as money, they have had to back it up with
penalties for those who may want to use something else.

One way to form an alternative money system and still comply with
the legal tender law would be to use American Eagle’s in place of
Federal Reserve Notes. The best part is it would not require any
new laws be pasted because American Eagle’s are Legal Tender.

I worked this out in 2009 when a bill was considered in the Montana
Legislature is attempting to make uncoined silver or gold bullion legal
tender. Here is what I suggested: http://goo.gl/CvFqv

Now, with the advent of Bitcoin, I see the day coming when former
Bitcoin Miner become "bankers" for BitExchanges. Under such a system
the account holder could be issued a "check book" just like a Bank
does today. The account holder would write out checks to pay bills,
just as we do now, only these checks would be denominated in Bitcoin
and not Federal Reserve Notes (FRN).

Let's say that the cost for a gallon of milk might be $6.25 FRN but the
merchant and I use the same BitExchange, I would then make out a check
for $0.329 BTC. The recipient of my check could go to our local Exchange
(BitBank) and deposit this check into their own account. The 'bank' would
then make the electronic transfer from my wallet to their wallet, or the
recipient could request immediate payment in legal tender (either FRN
or American Eagles). In effect, after selling 10 gallons of milk, the
merchandiser would have earned 1 troy once of silver through the
local BitExchange. 

In this way people could beat the inflation game.

The FED will continue to print more billions of FRN (as they are now doing),
but what would you care? Yes, they loose value on a daily basis, but if you
only hold on them long enough to pay a bill, so what? You're real store of
wealth and value would be in Bitcoins and Silver.






- Honest government requires honest money
- Decentralize everything, start with money
"Revolt now or be a debt slave." ~Max Keiser
EconomicOracle
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I can predict the future! Bitcoin will success!!!!


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June 10, 2011, 09:56:17 PM
 #4



Unfortuneatly yes

GOOOOOOOOOOO BITCOINS!!!!!!!!!!!!!!!
Edit: Oops. Just fixed a typo. It should be GO (like GO TEAM!) and not GOOB
Edit2: Just checked the dictionary and goob is not a word
ErgoOne
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June 10, 2011, 10:08:02 PM
 #5

Cloud9, as I understand it, those of us who live within the boundaries of the United States must accept official U.S. legal tender for payment of debts.  I believe that this is the only meaning of "legal tender".  Bitcoins (for example) MAY be accepted for payment of debts, but the other party is under no OBLIGATION to accept them.  So I would not expect to see any government accepting them in lieu of U.S. dollars for payment of taxes, or your landlord for payment of rent/bank for payment of mortgage.  However, it is perfectly legal to use bitcoins to pay for goods and services, just as it is perfectly legal to use any of a gazillion other forms of payment (including foreign currency), as long as the other party accepts them.

My husband and I are in the planning stages of developing an online fantasy shared world writing/art/gaming portal.  While he develops the world, writes the early mythology, and draws the "canonical" pictures for this world, I'm investigating ways to make it pay.  Bitcoin is an intriguing possibility; I expect that we will accept bitcoins when we get the site up and running if we can figure out the tax implications. (Probably will have to have a policy of "exchange rate on the date of payment" determines what the payment is worth, and therefore how much tax is owed.)
str4wm4n
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June 10, 2011, 10:17:39 PM
 #6

what do I care if they are "legal" tender?

I only care if they are lawful
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