What happens when the government bans businesses from accepting Bitcoins?

[bootlace]

I'm aware that Bitcoin is a decentralized system and it would be very difficult for any government or official body to take down in the traditional sense but I don't think they would need to actually shut it down to bring it under control. They would only need to put a law that bans any business from accepting Bitcoins, that alone would be enough to severely impair the system. No wise business would dare break such a law and incur criminal charges.

Bitcoin already is too slow in its payment confirmation process to be used in any real life retail scenario, so with online businesses also being shut out of the system, what else is left? Illegal activities, online casinos, services & digital products from small 'startups' or individuals, and just basic money transactions. If bitcoin based exchanges are also made illegal (because they also accept bitcoins when making sales), then what?

I'd love to hear a response to this highly possible scenario.

[DannyHamilton]

Bitcoin already is too slow in its payment confirmation process to be used in any real life retail scenario

Faster than checks, faster than credit cards, faster than store credit, faster than paypal.  Too slow?  Really?

[bootlace]

Bitcoin already is too slow in its payment confirmation process to be used in any real life retail scenario

Faster than checks, faster than credit cards, faster than store credit, faster than paypal.  Too slow?  Really?

I don't you can use a check or paypal in a real life retail store like a restaurant or a grocery store. Credit cards are pretty fast, takes like 30 seconds max. I thought Bitcoin payment took 10 minutes to confirm...

[bootlace]

I'm aware that Bitcoin is a decentralized system and it would be very difficult for any government or official body to take down in the traditional sense but I don't think they would need to actually shut it down to bring it under control. They would only need to put a law that bans any business from accepting Bitcoins, that alone would be enough to severely impair the system. No wise business would dare break such a law and incur criminal charges.

Bitcoin already is too slow in its payment confirmation process to be used in any real life retail scenario, so with online businesses also being shut out of the system, what else is left? Illegal activities, online casinos, services & digital products from small 'startups' or individuals, and just basic money transactions. If bitcoin based exchanges are also made illegal (because they also accept bitcoins when making sales), then what?

I'd love to hear a response to this highly possible scenario.

Bitcoin is pretty much legal, so this would probably never happen.

It's legal now, but can become illegal whenever the authorities view it as a threat they need to deal with. The argument has always been that the government can't shut down Bitcoin because it's decentralized, but my point is they dont need to shut it down, they just need to say businesses can't accept it and that would essentially destroy the 'invincible' bitcoin ecosystem.

[Peter Lambert]

Bitcoin already is too slow in its payment confirmation process to be used in any real life retail scenario

Faster than checks, faster than credit cards, faster than store credit, faster than paypal.  Too slow?  Really?

I don't you can use a check or paypal in a real life retail store like a restaurant or a grocery store. Credit cards are pretty fast, takes like 30 seconds max. I thought Bitcoin payment took 10 minutes to confirm...

Approximately 10 minutes average to get a confirmation by be put in a block, but the transaction can be seen on the network within seconds. For small purchases taking 0 confirm bitcoins is no riskier than taking a credit card.

[giraffe]

I think bitcoin will survive. at least I kind of hope

[DannyHamilton]

I don't you can use a check or paypal in a real life retail store like a restaurant or a grocery store.

Sure you can.  Where did you get that idea?

Credit cards are pretty fast, takes like 30 seconds max. I thought Bitcoin payment took 10 minutes to confirm...

Credit cards are fast to transmit the transaction, just like bitcoin is fast to transmit the transaction.  However, with credit cards the merchant doesn't actually have the money until settlement occurs (typically at the end of the day), and even then the payment can be reversed for up to 18 months.  Bitcoin confirms MUCH faster than that for MUCH lower fees.

[bootlace]

Bitcoin already is too slow in its payment confirmation process to be used in any real life retail scenario

Faster than checks, faster than credit cards, faster than store credit, faster than paypal.  Too slow?  Really?

I don't you can use a check or paypal in a real life retail store like a restaurant or a grocery store. Credit cards are pretty fast, takes like 30 seconds max. I thought Bitcoin payment took 10 minutes to confirm...

Approximately 10 minutes average to get a confirmation by be put in a block, but the transaction can be seen on the network within seconds. For small purchases taking 0 confirm bitcoins is no riskier than taking a credit card.

Well even credit cards have personal identification, credit record, and a bunch of other safety measures backing them up - wouldn't it be super risky to accept an unconfirmed payment from an anonymous bitcoin address?

[bootlace]

I'm aware that Bitcoin is a decentralized system and it would be very difficult for any government or official body to take down in the traditional sense but I don't think they would need to actually shut it down to bring it under control. They would only need to put a law that bans any business from accepting Bitcoins, that alone would be enough to severely impair the system. No wise business would dare break such a law and incur criminal charges.

Bitcoin already is too slow in its payment confirmation process to be used in any real life retail scenario, so with online businesses also being shut out of the system, what else is left? Illegal activities, online casinos, services & digital products from small 'startups' or individuals, and just basic money transactions. If bitcoin based exchanges are also made illegal (because they also accept bitcoins when making sales), then what?

I'd love to hear a response to this highly possible scenario.

Bitcoin is pretty much legal, so this would probably never happen.

It's legal now, but can become illegal whenever the authorities view it as a threat they need to deal with. The argument has always been that the government can't shut down Bitcoin because it's decentralized, but my point is they dont need to shut it down, they just need to say businesses can't accept it and that would essentially destroy the 'invincible' bitcoin ecosystem.

No it won't. Sites have two options move the servers out of the USA or pay in bitcoins and then they can't trace who owns the site. Me personality if that happens, it would be a gold rush to get as many of those sites that stopped accepting and getting it back up. Remember bitcoin is globe so it will always have stores and places to send them.

Ok let's say the government restrictions only happen in one country like the United States, then yes they could technically do that but what kind of companies can afford to completely leave the US market, certainly not any major company so that would be a big restriction on the growth prospects of bitcoin as a currency. And also how would Americans who are banned from purchasing bitcoins going to get a hold of bitcoins (or exchange into cash when they want to )? Remember exchanges would be banned from doing business with US customers just like many offshore banking locations now refuse US customers. Governments can refuse banks in the US from allowing money wires to or from any bitcoin exchange as well...

[DannyHamilton]

Well even credit cards have personal identification, credit record, and a bunch of other safety measures backing them up - wouldn't it be super risky to accept an unconfirmed payment from an anonymous bitcoin address?

All of which is useless in the case of a stolen credit card.

How is it any safer to accept a credit card from someone who might be a thief, than it is to accept a o confirm bitcoin payment from someone who might be a thief.

How much more difficult and expensive is it to double-spend a 0-confirm bitcoin transaction than to steal a credit card?

I think you'll find that chargebacks on credit cards are far more common (easier and cheaper for the thief) than double-spend bitcoin attacks against a properly prepared vendor.

[bootlace]

Well even credit cards have personal identification, credit record, and a bunch of other safety measures backing them up - wouldn't it be super risky to accept an unconfirmed payment from an anonymous bitcoin address?

All of which is useless in the case of a stolen credit card.

How is it any safer to accept a credit card from someone who might be a thief, than it is to accept a o confirm bitcoin payment from someone who might be a thief.

How much more difficult and expensive is it to double-spend a 0-confirm bitcoin transaction than to steal a credit card?

I think you'll find that chargebacks on credit cards are far more common (easier and cheaper for the thief) than double-spend bitcoin attacks against a properly prepared vendor.

I could be wrong but in the case of a stolen credit card being used, the seller of the product is not the one who incurs the charge, its the credit card companies who cover the cost. Also even with stolen credit cards, there is usually a thorough check and you can't simply keep letting your credit card getting stolen because there is a record of it. In the case of bitcoins, no one protects the seller and there is no system to ensure that a person is 'prone to losing their credit cards' because it's always anonymous and no record being kept.

[DannyHamilton]

I could be wrong but in the case of a stolen credit card being used, the seller of the product is not the one who incurs the charge, its the credit card companies who cover the cost.

You may be right on that, I'll have to look into it.

However, chargebacks and fees are definitely a significant issue for merchants that accept credit cards.  I suspect you'll find that the cost of the risk of accepting 0-confirm bitcoin transactions on small value purchases is less than the cost of accepting credit cards.

 

[DeathAndTaxes]

Who is this entity known as "the government" and how do they have control over all ~180 countries on the planet?

[DeathAndTaxes]

I could be wrong but in the case of a stolen credit card being used, the seller of the product is not the one who incurs the charge, its the credit card companies who cover the cost.

That isn't true.  In case of fraudulent use the merchant not only loses 100% they also get to pay a charge back fee of up to $35.00 for the privilege of having accepted a card that was stolen (or owner simply claimed was stolen).  Worse CC companies make it simply impossible for merchants to avoid/prevent fraud (both third party friend and so called "friendly fraud").  Seller can do absolutely nothing to prevent (reduce the chance but never prevent all cases) fraud and then loses everything PLUS a penalty when it happens.

[yvv]

What happens when the government bans businesses from accepting Bitcoins?

Which one of 196 governments are you talking about?

[bootlace]

I'm aware that Bitcoin is a decentralized system and it would be very difficult for any government or official body to take down in the traditional sense but I don't think they would need to actually shut it down to bring it under control. They would only need to put a law that bans any business from accepting Bitcoins, that alone would be enough to severely impair the system. No wise business would dare break such a law and incur criminal charges.

Bitcoin already is too slow in its payment confirmation process to be used in any real life retail scenario, so with online businesses also being shut out of the system, what else is left? Illegal activities, online casinos, services & digital products from small 'startups' or individuals, and just basic money transactions. If bitcoin based exchanges are also made illegal (because they also accept bitcoins when making sales), then what?

I'd love to hear a response to this highly possible scenario.

Bitcoin is pretty much legal, so this would probably never happen.

It's legal now, but can become illegal whenever the authorities view it as a threat they need to deal with. The argument has always been that the government can't shut down Bitcoin because it's decentralized, but my point is they dont need to shut it down, they just need to say businesses can't accept it and that would essentially destroy the 'invincible' bitcoin ecosystem.

No it won't. Sites have two options move the servers out of the USA or pay in bitcoins and then they can't trace who owns the site. Me personality if that happens, it would be a gold rush to get as many of those sites that stopped accepting and getting it back up. Remember bitcoin is globe so it will always have stores and places to send them.

Ok let's say the government restrictions only happen in one country like the United States, then yes they could technically do that but what kind of companies can afford to completely leave the US market, certainly not any major company so that would be a big restriction on the growth prospects of bitcoin as a currency. And also how would Americans who are banned from purchasing bitcoins going to get a hold of bitcoins (or exchange into cash when they want to )? Remember exchanges would be banned from doing business with US customers just like many offshore banking locations now refuse US customers. Governments can refuse banks in the US from allowing money wires to or from any bitcoin exchange as well...

That is easy, exchange the cash into Euros then those euros are sent to the exchange, if that is still an issue, local coin traders. They wouldn't be missing out on the US market, they just a bit of a difficult time to get the business, remember it is just digital currency it can be easily encrypted.

How do you send Euros to an exchange, you still need a bank to help you do that. You can't even take cash to a brick and mortar exchange because we're assuming bitcoin exchanges are prohibited. You could use cash to buy from a local, but that seems awfully inconvenient to have to do every time you want to add/remove money from the system and besides it would limit the amount of bitcoins Americans could have by the amount that is already in citizens' hands living inside the country.

[bootlace]

Who is this entity known as "the government" and how do they have control over all ~180 countries on the planet?

Well the US government has a large sphere of influence over the world, this is clear in how they have managed to maintain the US dollar as THE reserve currency all this time through endless money printing, and how they can engage in mindless wars and get away with. You can see how even lobby groups in the entertainment industry are managing to crack down on music/movie privacy in countries well outside their jurisdiction. So I would think that the US financial sector which is infinitely larger in size and scope would not have too much trouble convincing other economies, with the backing of the US government, that something needs to be done to put an end to this system that allows money laundering, financing of terrorism activities, purchase of illegal drugs, allowing of gambling in countries where its illegal etc (that will be their words and reasoning to convinve, not what I think myself).

[bootlace]

I'm aware that Bitcoin is a decentralized system and it would be very difficult for any government or official body to take down in the traditional sense but I don't think they would need to actually shut it down to bring it under control. They would only need to put a law that bans any business from accepting Bitcoins, that alone would be enough to severely impair the system. No wise business would dare break such a law and incur criminal charges.

Bitcoin already is too slow in its payment confirmation process to be used in any real life retail scenario, so with online businesses also being shut out of the system, what else is left? Illegal activities, online casinos, services & digital products from small 'startups' or individuals, and just basic money transactions. If bitcoin based exchanges are also made illegal (because they also accept bitcoins when making sales), then what?

I'd love to hear a response to this highly possible scenario.

Bitcoin is pretty much legal, so this would probably never happen.

It's legal now, but can become illegal whenever the authorities view it as a threat they need to deal with. The argument has always been that the government can't shut down Bitcoin because it's decentralized, but my point is they dont need to shut it down, they just need to say businesses can't accept it and that would essentially destroy the 'invincible' bitcoin ecosystem.

No it won't. Sites have two options move the servers out of the USA or pay in bitcoins and then they can't trace who owns the site. Me personality if that happens, it would be a gold rush to get as many of those sites that stopped accepting and getting it back up. Remember bitcoin is globe so it will always have stores and places to send them.

Ok let's say the government restrictions only happen in one country like the United States, then yes they could technically do that but what kind of companies can afford to completely leave the US market, certainly not any major company so that would be a big restriction on the growth prospects of bitcoin as a currency. And also how would Americans who are banned from purchasing bitcoins going to get a hold of bitcoins (or exchange into cash when they want to )? Remember exchanges would be banned from doing business with US customers just like many offshore banking locations now refuse US customers. Governments can refuse banks in the US from allowing money wires to or from any bitcoin exchange as well...

That is easy, exchange the cash into Euros then those euros are sent to the exchange, if that is still an issue, local coin traders. They wouldn't be missing out on the US market, they just a bit of a difficult time to get the business, remember it is just digital currency it can be easily encrypted.

How do you send Euros to an exchange, you still need a bank to help you do that. You can't even take cash to a brick and mortar exchange because we're assuming bitcoin exchanges are prohibited. You could use cash to buy from a local, but that seems awfully inconvenient to have to do every time you want to add/remove money from the system and besides it would limit the amount of bitcoins Americans could have by the amount that is already in citizens' hands living inside the country.

Have you never exchanged a currency before? Easily wire transfer USD to Euros in a bank in sweden or in the swiss, or in german then call that bank tell them to forward it to the exchange. It is legit that easily.

So you would need to hold a bank account outside the United States? How many people have such an arrangement? Also, in that case, the US government could still impose a rule that American citizen bank accounts in foreign countries can't make wire transfers to Bitcoin exchanges and expect these large institutions in Europe to inforce these rules on their behalf. Of course this is not very likely, but still possible.

[yvv]

something needs to be done to put an end to this system that allows money laundering, financing of terrorism activities, purchase of illegal drugs, allowing of gambling in countries where its illegal etc

USD allow all of these. I do not think they are going to put an end to USD.

[bootlace]

I'm aware that Bitcoin is a decentralized system and it would be very difficult for any government or official body to take down in the traditional sense but I don't think they would need to actually shut it down to bring it under control. They would only need to put a law that bans any business from accepting Bitcoins, that alone would be enough to severely impair the system. No wise business would dare break such a law and incur criminal charges.

Bitcoin already is too slow in its payment confirmation process to be used in any real life retail scenario, so with online businesses also being shut out of the system, what else is left? Illegal activities, online casinos, services & digital products from small 'startups' or individuals, and just basic money transactions. If bitcoin based exchanges are also made illegal (because they also accept bitcoins when making sales), then what?

I'd love to hear a response to this highly possible scenario.

Bitcoin is pretty much legal, so this would probably never happen.

It's legal now, but can become illegal whenever the authorities view it as a threat they need to deal with. The argument has always been that the government can't shut down Bitcoin because it's decentralized, but my point is they dont need to shut it down, they just need to say businesses can't accept it and that would essentially destroy the 'invincible' bitcoin ecosystem.

No it won't. Sites have two options move the servers out of the USA or pay in bitcoins and then they can't trace who owns the site. Me personality if that happens, it would be a gold rush to get as many of those sites that stopped accepting and getting it back up. Remember bitcoin is globe so it will always have stores and places to send them.

Ok let's say the government restrictions only happen in one country like the United States, then yes they could technically do that but what kind of companies can afford to completely leave the US market, certainly not any major company so that would be a big restriction on the growth prospects of bitcoin as a currency. And also how would Americans who are banned from purchasing bitcoins going to get a hold of bitcoins (or exchange into cash when they want to )? Remember exchanges would be banned from doing business with US customers just like many offshore banking locations now refuse US customers. Governments can refuse banks in the US from allowing money wires to or from any bitcoin exchange as well...

That is easy, exchange the cash into Euros then those euros are sent to the exchange, if that is still an issue, local coin traders. They wouldn't be missing out on the US market, they just a bit of a difficult time to get the business, remember it is just digital currency it can be easily encrypted.

How do you send Euros to an exchange, you still need a bank to help you do that. You can't even take cash to a brick and mortar exchange because we're assuming bitcoin exchanges are prohibited. You could use cash to buy from a local, but that seems awfully inconvenient to have to do every time you want to add/remove money from the system and besides it would limit the amount of bitcoins Americans could have by the amount that is already in citizens' hands living inside the country.

Have you never exchanged a currency before? Easily wire transfer USD to Euros in a bank in sweden or in the swiss, or in german then call that bank tell them to forward it to the exchange. It is legit that easily.

So you would need to hold a bank account outside the United States? How many people have such an arrangement? Also, in that case, the US government could still impose a rule that American citizen bank accounts in foreign countries can't make wire transfers to Bitcoin exchanges and expect these large institutions in Europe to inforce these rules on their behalf. Of course this is not very likely, but still possible.

You don't need an account out side the USA, you just say it is a currency exchange, when they ask where you want the euro's sent you give the outside of the usa bank the exchange deposit information.

I wasn't aware you could randomly wire money to a foreign bank and have them forward that money somewhere else. If so then, again, just tell these foreign banks that they are not allowed to forward money from US citizens to these exchanges. I would assume such protocols are in place for gambling deposits for example already.