The future of Bitcoin is illegal

[nobbynobbynoob]

I'm interested in selling off my precious BTC for a fiat profit for as long as I need to use fiat on a regular basis. However, I also want to do something interesting and productive involving Bitcoin besides mining or speculating. I just have yet quite to figure out what that niche is, but I'm gonna try and work on it.

[sturle]

There is only one reason for a normal person to want a Bitcoin - to break rules, laws, and regulations. This is the future of Bitcoin, this is what will drive the price up, and I think this is what we should all be focusing on.

I've been using Bitcoin as a currency since the autumn of 2010.  So far I haven't done anything illegal.  I report my coins and my earnings to th tax authorities, who have no idea what it is.  So far it is untaxed, but I have done everything right.  Nothing I have bought or sold has been illegal.  I use Bitcoin because it is usually simpler and faster and cheaper and more secure than all other ways of international money transfer.  That is a lot of pros and no cons.

In my opinion the future is legal.  I sell coins every day to people who use the coins to pay for services or as a store of value / investment.  Nothing of this is illegal.  And the value will of course drop to the bottom if Bitcoin is deemed illegal.  Both I and most other people will get rid of all we have as soon as possible, and it is going to be hard to do it in a legal way.

[markm]

I still think the cryptocoin ecosystem needs more than just bitcoins.

Bitcoins keep going up in value and can reasonably be expected to do so for quite some time.

We need things just as easy to use, compatible in their use, in short, altcoins, that do not go up in value as fast.

The prejudice against altcoins has been very destructive, I think.

Basically store of value and transmission of value are two different functions, and it is very useful to be able to use two different coins for these functions so you can stash your fast-appreciating bitcoins away in a margin aka collateral aka leverage account and borrow, using your bitcoins as collateral, something that appreciates much slower or not at all.

Obviously the fact that fiat tends to depreciate in value makes it tempting as the asset to borrow, but it lacks the ease of use cryptocoin users are accustomed to. Thus various altcoins are often much more convenient a choice as the asset to borrow.

From some reading I have been doing it seems possible that what "should happen" is the interest rates should adjust to prevent any one currency coming out ahead of any other as "the best one to borrow" but if in fact arbitrage or something is going to get to that point eventually it does not seem to have done so yet as some nice profits are being made even by the simple strategy of borrowing altcoins with which to buy more bitcoins to use as collateral to borrow more altcoins with which to buy more bitcoins, etcetera.

I do not agree that the future of bitcoin is illegal, as was already pointed out just one of the payment processors supporting bitcoin has over a thousand merchants accepting bitcoin, it seems unlikely they are all illegal businesses.

I do think though that the future is a diverse ecosystem of cryptocurrencies because there do seem to be advantages to diversity.

-MarkM-

[Come-from-Beyond]

Like many of you, I hold a substantial number of Bitcoins.

There is only one reason for a normal person to want a Bitcoin - to break rules, laws, and regulations.

Rare to see commons sense in the bitcoin forums. Support.

OP voices what (my estimate) 90% of bitcoin holders is thinking.

Look kids. Trolls. Don't stare too long or you will catch the dumb.

Thx for very useful post. U r the first person in my ignore list who is included not due to personal insults.

[Nicolai Larsen]

There is only one reason for a normal person to want a Bitcoin - to break rules, laws, and regulations.

You're suggesting only terrorists & criminals use bitcoin?

What a thing to say.  

There are plenty of legit reasons to support and use bitcoins.

1.  Economic stability.  Bitcoins are more stable than currency printed by central banks.

2.  Low transfer costs.
So far...

3.  Independence from banks, credit cards and others who have near to a monopoly on money exchanges.
MTGox?

4.  Protection from inflation.

.

[Bitcoin Oz]

I still think the cryptocoin ecosystem needs more than just bitcoins.

Bitcoins keep going up in value and can reasonably be expected to do so for quite some time.

We need things just as easy to use, compatible in their use, in short, altcoins, that do not go up in value as fast.

The prejudice against altcoins has been very destructive, I think.

Basically store of value and transmission of value are two different functions, and it is very useful to be able to use two different coins for these functions so you can stash your fast-appreciating bitcoins away in a margin aka collateral aka leverage account and borrow, using your bitcoins as collateral, something that appreciates much slower or not at all.

Obviously the fact that fiat tends to depreciate in value makes it tempting as the asset to borrow, but it lacks the ease of use cryptocoin users are accustomed to. Thus various altcoins are often much more convenient a choice as the asset to borrow.

From some reading I have been doing it seems possible that what "should happen" is the interest rates should adjust to prevent any one currency coming out ahead of any other as "the best one to borrow" but if in fact arbitrage or something is going to get to that point eventually it does not seem to have done so yet as some nice profits are being made even by the simple strategy of borrowing altcoins with which to buy more bitcoins to use as collateral to borrow more altcoins with which to buy more bitcoins, etcetera.

I do not agree that the future of bitcoin is illegal, as was already pointed out just one of the payment processors supporting bitcoin has over a thousand merchants accepting bitcoin, it seems unlikely they are all illegal businesses.

I do think though that the future is a diverse ecosystem of cryptocurrencies because there do seem to be advantages to diversity.

-MarkM-

I think thats where a coin like the proposed freicoin comes in.

[nobbynobbynoob]

I've been using Bitcoin as a currency since the autumn of 2010.  So far I haven't done anything illegal.  I report my coins and my earnings to th tax authorities, who have no idea what it is.  So far it is untaxed, but I have done everything right.

While I'm no lover of the State and the taxman, I do respect and admire your honesty.

In my opinion the future is legal.  I sell coins every day to people who use the coins to pay for services or as a store of value / investment.  Nothing of this is illegal.

I don't think I can disagree with that.

And the value will of course drop to the bottom if Bitcoin is deemed illegal.  Both I and most other people will get rid of all we have as soon as possible, and it is going to be hard to do it in a legal way.

I'm not convinced that's true. After all, prohibition has never made illicit drugs cheap, quite the opposite!

[markm]

I think thats where a coin like the proposed freicoin comes in.

The "inflatacoins", DeVCoin and GRouPcoin, might work too. So far I have mostly seen DeVCoin used for the purpose and it has been working well so far.

(Both of them keep minting the same number of coins per block "forever".)

-MarkM-

[Severian]

And the value will of course drop to the bottom if Bitcoin is deemed illegal.

I think it would have the opposite approach. Recall that Bitcoin began to go through the roof last year when Chuck Schumer started screeching about them.

Any attention to Bitcoin by banks or governments will increase their value. People may be sheep, but sheep aren't utterly stupid.

[markm]

DId gold crash down in value in the U.S. when the government confiscated it?

-MarkM-

[Wekkel]

DId gold crash down in value in the U.S. when the government confiscated it?

-MarkM-

In fact, it went soo bad with gold that foreign countries redeemed their dollars en masse for this worthless piece of metal in the sixties, ultimately forcing Nixon to close the Gold window. The land of the free has been 'not so free' a lot longer (even going back so far as Lincoln).

[CharlieContent]

Thanks for all the replies, I really appreciate everyone who made an intelligent point joining the debate, whether we agree or not. I'm pleased to see that many people do agree with me. Here are some words for those who dont:

I'd rather spend my bitcoins than change it to EUR. I only buy EUR and USD so I can get more bitcoins when the price fluctuate.

Spend them on what? There's nothing other than drugs to spend them on.  If you want to buy literally anything else (and drugs too), you'll find EUR and USD absolutely perfect for your needs.

I hope you can sell them before the dollar goes bust.

anyone who wants dollars in this environment is not paying a great deal of attention

Hahaha. I am good with dollars, thanks. You can buy things with dollars, plus invest them in legitimate things. You can't buy anything with Bitcoin, and 90% of Bitcoin investments are a scam.

You're suggesting only terrorists & criminals use bitcoin?

What a thing to say.  

There are plenty of legit reasons to support and use bitcoins.

1.  Economic stability.  Bitcoins are more stable than currency printed by central banks.

2.  Low transfer costs.  

3.  Independence from banks, credit cards and others who have near to a monopoly on money exchanges.

4.  Protection from inflation.

I'm suggesting that only those who wish to break a law, rule or regulation have a good reason to use bitcoin.

Also, with regards to your points.

1. What utter nonsense. The dollar has been pretty steady against the gbp for 2 years now. Bitcoin has been up and down like  a yo-yo. It's the least stable currency  in the world.

2. It's only low until all the coins are mined.

3. There are no monopolies with banks and credit cards. I agree that Paypal has a ridiculous monopoly but there's no need for another currency to stop them, just a better system.

4. See point 1.

*cough* There are hundreds of merchants accepting Bitcoin. Hundreds are listed on the wiki. There are more than a thousand merchants alone using Bitpay. There is so much to buy in bitcoins!

Why the fuck would someone go to the hassle of converting USD into Bitcoin when they could go on amazon and buy any of that instantly with their credit card?

Of course, there's also all the normal people who simply want to hedge against inflation and therefore buy some gold, silver and Bitcoins - what's wrong with that?

This is the only decent counterargument I've seen. However the fact remains that you can't eat gold, silver or Bitcoins. If you want food or to pay your mortgage/rent, you still need to turn it into government backed currency. I also think the price fluctuates way too much to make it useful for this purpose, but I guess as a wildcard hedge in a basket of commodities it kinda makes sense. Kinda. But I honestly don't think many people are interested in doing that. Most people see inflation as a fact of life, not something to wage a life long battle against. That might be unwise but it is the prevailing attitude.

I use Bitcoin because it is usually simpler and faster and cheaper and more secure than all other ways of international money transfer. 

In my opinion the future is legal.  I sell coins every day to people who use the coins to pay for services or as a store of value / investment.  Nothing of this is illegal.  And the value will of course drop to the bottom if Bitcoin is deemed illegal.  Both I and most other people will get rid of all we have as soon as possible, and it is going to be hard to do it in a legal way.

Simpler? Than going to a bank and doing an IBAN transfer? Man, cheaper maybe but not simpler. Getting money in and out of Bitcoin is an extreme hassle for most people. I don't think, for most people, it's a substantially better way to transfer money internationally. It's pretty slow, there is a hassle getting money in and out the system, and transfers won't be free forever.

Plus, for people to use Bitcoin to transfer money, they need to be aware of it, and they need to make a special effort to use it. Why would anyone spend money in order to market the system like that? They would need a reason, and that means exchange fees.

As to your 2nd point, if Bitcoin is made illegal somewhere then the value will soar. And of course people will be able to use it legally in another country.

[cunicula]

Again, I concur with most of your arguments.

As to your 2nd point, if Bitcoin is made illegal somewhere then the value will soar.

However, I disagree with this.

Let's assume bitcoin is illegal in the US, but legal in other countries. Legal exchanges exist in these countries.
Could you explain why you think illegality in the US would increase the world price of bitcoin?

[nobbynobbynoob]

Again, I concur with most of your arguments.

As to your 2nd point, if Bitcoin is made illegal somewhere then the value will soar.

However, I disagree with this.

Let's assume bitcoin is illegal in the US, but legal in other countries. Legal exchanges exist in these countries.
Could you explain why you think illegality in the US would increase the world price of bitcoin?

It could become more profitable to export/sell bitcoins to people in the US. This would be akin to the aggressive enforcement actions of the DEA raising the market price of drugs. Yes, the drugs in question are illegal just about anywhere, but not all countries enforce the drug laws as harshly as the US (and of course there are a few, e.g. Singapore, that are a lot more harsh than the US!).

[CharlieContent]

Let's assume bitcoin is illegal in the US, but legal in other countries. Legal exchanges exist in these countries.
Could you explain why you think illegality in the US would increase the world price of bitcoin?

Publicity and the lure of the illicit.

[muyuu]

Porn and internet services you want to contract privately are also a good niche right now.

As for the conclusion illegal->price raise, there is no solid evidence to back it up, just some wild speculation.

[SuperHakka]

Read this I had a great idea (typically for me anyways), now I have changed cash into btc using various exchanges and methods and that's ok though some ways have high fees. I thought of another way and to convert my savings into btc and that is to open online shop taking payments in BTC. I would buy my stock using the fiat and my business would poop out BTC. So all you btc millionaires can start giving me your btc ok? The future of bitcoin isn't illegal, the future is ME, muahha haha ha  

[benjamindees]

Look kids. Trolls. Don't stare too long or you will catch the dumb.

Troll thread attracts trolls, film at 11.

[interlagos]

What is illegal? As people start distrusting govt-backed "money" they will figure out that govt-backed "laws" are no different. They are just arbitrary abstractions imposed on them against their will. Or do you suggest that governments these days have highest approval ratings in history? No, they don't.

The future of Bitcoin is that govt in its current form will be dimmed illegal!
You're dealing with Super Nova explosion here in slow-mo, there is nothing you can do about it other than observe its magnificence, and don't get too close or you'll get burned.

[Seal]

Hi Charlie, I'm trying to understand your first point more clearly, in one paragraph you post about the more able members helping the weaker members, but following that you are stating a clear desire to push the price up to sell for more for personal profit. (almost sounds like a pump-and-dump):

I actually think that the more able members of our society have a duty to help the weaker members, so I don't have any weird libertarian fantasies. I'm just in it for the money. The actual, folding, bank account, Visa card money.

So how can we push the price of Bitcoin up so that we can sell our coins for more? As everyone knows, in order to increase prices we need to spike demand. So why would anyone want a Bitcoin?

Basically store of value and transmission of value are two different functions, and it is very useful to be able to use two different coins for these functions so you can stash your fast-appreciating bitcoins away in a margin aka collateral aka leverage account and borrow, using your bitcoins as collateral, something that appreciates much slower or not at all.

I do not agree that the future of bitcoin is illegal, as was already pointed out just one of the payment processors supporting bitcoin has over a thousand merchants accepting bitcoin, it seems unlikely they are all illegal businesses.

-MarkM-

I'm with MarkM on this one. I think you need to clearly understand that different individuals perceive value differently. I highly value a bitcoin over a USD as the value of any usd for the near future will drop due to inflation (quantitative easing). As you've already experienced Charlie, the value of bitcoin over since its inception has only gone up... to your benefit!

Also, on your view that the future is illegal. I disagree. The reason? Its technologically useful. And $110+ million of market capitalisation backs up a perception that it is something with real world value.

After World War II, it was illegal in the US to sell or distribute encryption technology overseas; in fact, encryption was designated as auxiliary military equipment and put on the United States Munitions List.[42] Until the development of the personal computer, asymmetric key algorithms (i.e., public key techniques), and the Internet, this was not especially problematic. However, as the Internet grew and computers became more widely available, high quality encryption techniques became well-known around the globe. As a result, export controls came to be seen to be an impediment to commerce and to research.

To give my view a bit more depth, I'll use the analogy above. The US, after creating cryptography saw a huge threat in homeland security if it was used outside of its country by an enemy. They subsequently realised after the technology went mainstream that they could not stop growing consumer demand. If bitcoin is deemed illegal in the US, demand will drop but ultimately it will continue from the rest of the world.

When global adoption reaches a critical mass, if the US isn't in, then it will be at a disadvantage.