Is bitcoin's anonymity really a problem for the governments and regulations?

[owm123]

I was just reading this article:
Anonymity Recognized as Serious Problem with Bitcoin
https://coinreport.net/anonymity-recognized-serious-problem-bitcoin/

It says, among other things:

some fear anonymity might be the issue that truly threatens bitcoin’s future

Regarding anonymity, Bernanke explained it’s a “bug” in that it allows bitcoin to be the vehicle for illicit transactions. He suspects government oversight will be a result of this, and could reduce the appeal of bitcoin and other cryptocurrencies.

I wonder why so many people worry about this? It is rather known fact that bitcoin is not anonymous, but only pseudo-anonymous (http://www.bitcoinisnotanonymous.com/). And what will happen with Bitcoin if CT or Zerocoin or some other technology will be incorporated to bitcoin, to make it truly anonymous?

[Small]

It is hard for government to track the coins as addresses are pseudonymous means that they can't identity illegal fundings and money laundering. It is a slight problem since places like localbitcoins doesn't require ID and does not need to comply with the local policies. Even with regulated exchanges, people can still do trades underground and thus pose a problem for money laundering concerns.

[klf]

It is hard for government to track the coins as addresses are pseudonymous means that they can't identity illegal fundings and money laundering. It is a slight problem since places like localbitcoins doesn't require ID and does not need to comply with the local policies. Even with regulated exchanges, people can still do trades underground and thus pose a problem for money laundering concerns.

Yes it is correct. Because of this anonymity many governments are not ready to accept/support bitcoin as a payment processor officially. If one really want to hide their transaction then no one can find who has send that money so many governments worry. There are many options for you to buy bitcoins without any ID proofs not only localbitcoins.

[owm123]

It is hard for government to track the coins as addresses are pseudonymous means that they can't identity illegal fundings and money laundering. It is a slight problem since places like localbitcoins doesn't require ID and does not need to comply with the local policies. Even with regulated exchanges, people can still do trades underground and thus pose a problem for money laundering concerns.

So should CT or zerocoin be added to bitcoin, to make it even more anonymous? If governments worry about bitcoin pseudo-anonymity now, what will they say when it will be fully anonymous?

[dothebeats]

Lol at the fears on anonymity. Only those who wanted control fear it  e.g. the government. For us who wanted more freedom on our money and our spending, it is nit a problem, really. If the governments are really sincere on taking care of people's interest, they should focus more on their problems and care less on bitcoin's pseudo-anonymous nature. Money laundering and illegal fundings might be an issue, but do governments know that only a tiny--microscopic--portion of that funds came from bitcoin and the rest are on fiat?

[croato]

I bet their real problem with Bitcoin is not anonymity. Their real problem is that they dont control it, cant reverse transactions and cant print more when they need more money.

[CoinBateman]

It is hard for government to track the coins as addresses are pseudonymous means that they can't identity illegal fundings and money laundering. It is a slight problem since places like localbitcoins doesn't require ID and does not need to comply with the local policies. Even with regulated exchanges, people can still do trades underground and thus pose a problem for money laundering concerns.

Its not hard. They can do it very well actually.

[ajareselde]

The anonymity is only being directed as a "wrapping paper" in order for banks and competing services to lobby against bitcoin,
while the anonymity as a real problem doesn't even exist. Every satoshi can be traced all the way back to block it was generated from.

[owm123]

It is hard for government to track the coins as addresses are pseudonymous means that they can't identity illegal fundings and money laundering. It is a slight problem since places like localbitcoins doesn't require ID and does not need to comply with the local policies. Even with regulated exchanges, people can still do trades underground and thus pose a problem for money laundering concerns.

Its not hard. They can do it very well actually.

What do you mean by they? Governments? NSA? Exchanges?

[Kakmakr]

It is only a problem for them, if they lose out on tax opportunities AND if they cannot control the flow of the currency out of the country. Some government employees even use it to receive bribes or they steal it, when it is seized from the public. <Silkroad>

It is all about the control of the monetary system and the reluctance to sacrifice the power they have over it. If only they could offset that negative side with all the positive things < Job creation / Tax income > 

[avatar_kiyoshi]

Regulation is not the problem; it is education
https://bitcoinmagazine.com/articles/law-enforcement-and-regulators-agree-bitcoin-not-useful-for-terrorists-already-regulated-appropriately-1448316076

[NorrisK]

I bet their real problem with Bitcoin is not anonymity. Their real problem is that they dont control it, cant reverse transactions and cant print more when they need more money.

They can still take your coins from you by invading your house and taking all your belongings there.

Just look at what happened to BurtW. IF they want to, they can make your life as hard as with fiat.

[Amph]

It is hard for government to track the coins as addresses are pseudonymous means that they can't identity illegal fundings and money laundering. It is a slight problem since places like localbitcoins doesn't require ID and does not need to comply with the local policies. Even with regulated exchanges, people can still do trades underground and thus pose a problem for money laundering concerns.

Its not hard. They can do it very well actually.

What do you mean by they? Governments? NSA? Exchanges?

it's the central autorithy of any country, bank have also the same importance basically

and like it was said the terrorist need to dump at some point and when they dump for fiat they are traceable, moving big funds of bitcoin  is not easy to link with terrorist but they are useless in the end

[Mickeyb]

All of this is bunch of BS quite honestly! Cash is 10 times more anonymous than Bitcoin. Truth of the matter is that if you really want to be completely anonymous with Bitcoin, you have to take many precautions that are not at all easy to take. And if you make just one mistake along the way, there goes your anonymity! And everything is so easily followed online and via the blockchain.

These so called experts are just talking out of their a**es !

[MaxTax]

The governments fear is the anonymity that revolves around bitcoin. They can't track everyone's personal info down plus they don't gain anything from bitcoin.

[owm123]

All of this is bunch of BS quite honestly! Cash is 10 times more anonymous than Bitcoin. Truth of the matter is that if you really want to be completely anonymous with Bitcoin, you have to take many precautions that are not at all easy to take. And if you make just one mistake along the way, there goes your anonymity! And everything is so easily followed online and via the blockchain.

These so called experts are just talking out of their a**es !

Yes. but cash can be printed by the government. bitcoin cant. Thus, governments dont worry about cash too much, i think, as they control its supply.

[guybrushthreepwood]

Re: Is bitcoin's anonymity really a problem for the governments and regulations?

It's a big problem for the type of governments that what to spy and log and track everything you ever do. Unless you go out of your way to hide your activity by using proxies and mixers etc they'll still likely be easily able to find out what bitcoins belong to you anyway.

I was just reading this article:
Anonymity Recognized as Serious Problem with Bitcoin
https://coinreport.net/anonymity-recognized-serious-problem-bitcoin/

It says, among other things:

some fear anonymity might be the issue that truly threatens bitcoin’s future

Regarding anonymity, Bernanke explained it’s a “bug” in that it allows bitcoin to be the vehicle for illicit transactions. He suspects government oversight will be a result of this, and could reduce the appeal of bitcoin and other cryptocurrencies.

I wonder why so many people worry about this? It is rather known fact that bitcoin is not anonymous, but only pseudo-anonymous (http://www.bitcoinisnotanonymous.com/). And what will happen with Bitcoin if CT or Zerocoin or some other technology will be incorporated to bitcoin, to make it truly anonymous?

But it can be anonymous if you want it to be regardless of what people might think. If one bag guy wants to send money to another bad guy then they can do that without revealing their true identities if they're careful and there's nothing someone can do about it. This is a problem for govs but it's something they're going to have to deal with and it's no different from cash transactions that they can't really trace. Bitcoin isn't going anywhere at the end of the day regardless of the problems it causes for the powers that be.

[XinXan]

the main problem for government they can't took fee from my transaction

In the end they are taking fees anyways, a lot of people still exchange bitcoins to cash because you can't buy a lot of things with bitcoins so they end  up taking fees when you withdraw the money to your bank, obviously not as many fees. In the end taxes are needed, it's not like we pay taxes for nothing.

[owm123]

The governments fear is the anonymity that revolves around bitcoin. They can't track everyone's personal info down plus they don't gain anything from bitcoin.

If they tap into exchanges or any online shop database your are using bitcoins with your real name or address, they could track your bitcoin. Bitcoin is only pseduo-anonymous, thus if your id is link with your address(es), tracking becomes is relatively easy with resource governments or feds have.

[foxkyu]

the main problem for government they can't took fee from my transaction

I think i don't have problem if government took fees for my transaction, it's for develop our country.

But the real problem is when other country took fees from our transaction and no contribution for my country, that was what i dislike.