Wall Observer BTC/USD - Bitcoin price movement tracking & discussion

[Coinseeker]

Coinage Act of 1965, Section 102 states: “All coins and currencies of the United States (including Federal Reserve notes and circulating notes of Federal Reserve banks and national banking associations), regardless of when coined or issued, shall be legal tender for all debts, public and private, public charges, taxes, duties, and dues.” Only United States currencies (including Federal Reserve Notes) are currently legal tender in the US.

Keyword being LEGAL tender.  Thanks for that BTW.

"An astute reader may note that legal tender only concerns the repayment of debt, taxes, duties, and dues."
Citizens are free to use any currency for an unofficial transaction.

Not familiar with any laws (or how to read them lawyer speak) so might a dumb question...but does the USD being legal tender in the US mean that other currencies are illegal? Or the other currencies can still be be used but just not legally obliged to be accepted?

That's your answer. Legal tender only matters where the government or judicial system is involved.
So you can't pay taxes in bitcoins. But you can pay your neighbor bitcoins for some vegetables.

You know, upon rereading that, that could be a really good legal loophole as long as transactions remained private.  That still would prevent legal mass adoption by businesses I would think, as every legal business needs a business license issued by the government but that is an argument that could be made.  Nice.  

[el_rlee]

Are the Americans up already? Panic or not?

[MickeyT2008]

Are the Americans up already? Panic or not?

7.28am in New York.  Some will have reacted to this news last night but a lot of others will have gone to bed before the news broke.  How significant the news is doesn't matter, what matters is how significant people think it is and how they react to it.

[Coinseeker]

Bitcoin might be a currency but since it's only numbers in a computer and not a physical object can it even be said to exist?  Anyway, surely it wouldn't be a crime for someone in the US to pay someone else in Euros or Stirling if they were both happy about it.  If the US government start using a clause like that then it's obviously only because they're miffed about not getting to tax it, but they'd probably use some BS excuse like counter-terrorism, protecting kids, etc like they always do for things they don't like.

See these are all the questions no one really has answers to.  There is all this grey area because of the internet.  But if the government is not getting it's cut, they are not going to let that ride.  Crypto certainly has it's challenges ahead.  This online tax bill in congress is alot bigger than I think some people understand.  The USG is looking to remove that grey area.  I'm not saying any of this is right or fair...I'm just saying it is what it is.

[Stephen Gornick]

Keyword being LEGAL tender.

You are misunderstanding the term "legal tender".

A medium of payment allowed by law or recognized by a legal system to be valid for meeting a financial obligation.

- http://en.wikipedia.org/wiki/Legal_tender

So that doesn't mean using anything else to pay is illegal, it simply means I cannot force you to pay in anything other than the medium defined by law as legal tender.   If you and I want to trade using seashells (which are anonymous, and can be traded anymously), that is not using legal tender but it most certainly is not prohibited by law.

[crumbcake]

Are the Americans up already? Panic or not?

We're awake.  Panic!  

[MickeyT2008]

So that doesn't mean using anything else to pay is illegal, it simply means I cannot force you to pay in anything other than the medium defined by law as legal tender.   If you and I want to trade using seashells (which are anonymous, and can be traded anymously), that is not using legal tender but it most certainly is not prohibited by law.

+1

[Coinseeker]

Are the Americans up already? Panic or not?

Yeah it's early.  I'm going to be dead today.  Just looking at the asks vs bids would tell me this thing is headed back down but, what do I know?  I learned about Bitcoin some 6 weeks or so ago and it seems it does whatever it wants.

[Coinseeker]

Keyword being LEGAL tender.

You are misunderstanding the term "legal tender".

A medium of payment allowed by law or recognized by a legal system to be valid for meeting a financial obligation.

- http://en.wikipedia.org/wiki/Legal_tender

So that doesn't mean using anything else to pay is illegal, it simply means I cannot force you to pay in anything other than the medium defined by law as legal tender.   If you and I want to trade using seashells (which are anonymous, and can be traded anymously), that is not using legal tender but it most certainly is not prohibited by law.

The transaction itself is not illegal.  I concede that point.  But not paying the taxes on the transaction is illegal.  

[el_rlee]

Can't you sue the DHS? Some loaded early adopter should be able to afford an expensive lawyer, and that's what it's all about in USA, isn't it?

[crumbcake]

Bitcoin might be a currency but since it's only numbers in a computer and not a physical object can it even be said to exist?  Anyway, surely it wouldn't be a crime for someone in the US to pay someone else in Euros or Stirling if they were both happy about it.  If the US government start using a clause like that then it's obviously only because they're miffed about not getting to tax it, but they'd probably use some BS excuse like counter-terrorism, protecting kids, etc like they always do for things they don't like.

See these are all the questions no one really has answers to.  There is all this grey area because of the internet.  But if the government is not getting it's cut, they are not going to let that ride.  Crypto certainly has it's challenges ahead.  This online tax bill in congress is alot bigger than I think some people understand.  The USG is looking to remove that grey area.  I'm not saying any of this is right or fair...I'm just saying it is what it is.

There's no "gray area" if you consider fiat currency to be a sound system.  Bitcoin dilutes the fiat economy, without introducing any value.  Just like printing more money.  If you are holding $$$, it's certainly not in your benefit for Bitcoin to succeed.  

[Pzi4nk]

Coinage Act of 1965, Section 102 states: “All coins and currencies of the United States (including Federal Reserve notes and circulating notes of Federal Reserve banks and national banking associations), regardless of when coined or issued, shall be legal tender for all debts, public and private, public charges, taxes, duties, and dues.” Only United States currencies (including Federal Reserve Notes) are currently legal tender in the US.

Keyword being LEGAL tender.  Thanks for that BTW.

"An astute reader may note that legal tender only concerns the repayment of debt, taxes, duties, and dues."
Citizens are free to use any currency for an unofficial transaction.

Not familiar with any laws (or how to read them lawyer speak) so might a dumb question...but does the USD being legal tender in the US mean that other currencies are illegal? Or the other currencies can still be be used but just not legally obliged to be accepted?

That's your answer. Legal tender only matters where the government or judicial system is involved.
So you can't pay taxes in bitcoins. But you can pay your neighbor bitcoins for some vegetables.

You know, upon rereading that, that could be a really good legal loophole as long as transactions remained private.  That still would prevent legal mass adoption by businesses I would think, as every legal business needs a business license issued by the government but that is an argument that could be made.  Nice.  

Actually, business transactions ARE private. Only debts to the government are public. There is nothing stopping businesses in the US from legally accepting bitcoin.

[MickeyT2008]

So that doesn't mean using anything else to pay is illegal, it simply means I cannot force you to pay in anything other than the medium defined by law as legal tender.   If you and I want to trade using seashells (which are anonymous, and can be traded anymously), that is not using legal tender but it most certainly is not prohibited by law.

Of course though if you declare seashells legal tender then you'd have a serious inflation problem due to their availability.  This would make it necessary to pump so much acidic industrial waste into the sea that they all dissolve, thus re-valuing your currency.

[Pzi4nk]

Can't you sue the DHS? Some loaded early adopter should be able to afford an expensive lawyer, and that's what it's all about in USA, isn't it? [emphasis by Pzi4nk]

I wouldn't limit it to the USA.

[Coinseeker]

So that doesn't mean using anything else to pay is illegal, it simply means I cannot force you to pay in anything other than the medium defined by law as legal tender.   If you and I want to trade using seashells (which are anonymous, and can be traded anymously), that is not using legal tender but it most certainly is not prohibited by law.

Of course though if you declare seashells legal tender then you'd have a serious inflation problem due to their availability.  This would make it necessary to pump so much acidic industrial waste into the sea that they all dissolve, thus re-valuing your currency.

   Well that shouldn't be hard.

[crumbcake]

So that doesn't mean using anything else to pay is illegal, it simply means I cannot force you to pay in anything other than the medium defined by law as legal tender.   If you and I want to trade using seashells (which are anonymous, and can be traded anymously), that is not using legal tender but it most certainly is not prohibited by law.

Of course though if you declare seashells legal tender then you'd have a serious inflation problem due to their availability.  This would make it necessary to pump so much acidic industrial waste into the sea that they all dissolve.

It's more than that.  If all the fiat in country A bought one cow, and an agent within that country issued a new currency, the worth of which was claimed to be .2 cows, where does the extra .2 cows come from?

[Coinseeker]

Actually, business transactions ARE private. Only debts to the government are public. There is nothing stopping businesses in the US from legally accepting bitcoin.

Yes actually I have conceded that point.  From the info provided I don't see the transactions being illegal but if the business were to not pay taxes on said transactions, that would be the violation.  I think that's a fair understanding up to this point. 

[MickeyT2008]

Actually, business transactions ARE private. Only debts to the government are public. There is nothing stopping businesses in the US from legally accepting bitcoin.

Yes actually I have conceded that point.  From the info provided I don't see the transactions being illegal but if the business were to not pay taxes on said transactions, that would be the violation.  I think that's a fair understanding up to this point. 

This is true, it's also one of the reasons that we like bitcoins!

[el_rlee]

Can't you sue the DHS? Some loaded early adopter should be able to afford an expensive lawyer, and that's what it's all about in USA, isn't it? [emphasis by Pzi4nk]

I wouldn't limit it to the USA.

Hopefully this will get a precedent for legal BTC usage.

[Coinseeker]

Bitcoin might be a currency but since it's only numbers in a computer and not a physical object can it even be said to exist?  Anyway, surely it wouldn't be a crime for someone in the US to pay someone else in Euros or Stirling if they were both happy about it.  If the US government start using a clause like that then it's obviously only because they're miffed about not getting to tax it, but they'd probably use some BS excuse like counter-terrorism, protecting kids, etc like they always do for things they don't like.

See these are all the questions no one really has answers to.  There is all this grey area because of the internet.  But if the government is not getting it's cut, they are not going to let that ride.  Crypto certainly has it's challenges ahead.  This online tax bill in congress is alot bigger than I think some people understand.  The USG is looking to remove that grey area.  I'm not saying any of this is right or fair...I'm just saying it is what it is.

There's no "gray area" if you consider fiat currency to be a sound system.  Bitcoin dilutes the fiat economy, without introducing any value.  Just like printing more money.  If you are holding $$$, it's certainly not in your benefit for Bitcoin to succeed.  

I'm not talking personal ideology, I'm talking grey area from a legal standpoint.  The USG is coming for their taxes.  You can bet with 100% certainty this will be the case.  But the USG will want to have solid legal footing to do so.  Because of the internet, it's requiring updated rules, regulations and policies to deal with it.  This is all new for everyone.