States vs Bitcoins

[jolly-roger]

Watching the dizzying growth of the Bitcoins in April, I can't get away from the question: Where is the money from? Over the last month somebody poured about $ 300 million into Bitcoins. Fictions about Cyprus can be immediately forgotten.

I suppose that existence of anonymous digital currency like a Bitcoin capable  to effectively kill all of the modern states in nearest 10 years, the reason being that in the tax area, states will have to go back to the early Middle Ages if coins will be used wide. Those monstrous entities that we see as a modern states can not exist on these handouts.

There is only one solution for states - to kill Bitcoin. There many diffent ways and approaches. It is possible to try to block pools generation and transmission of information on the Internet, or prohibiting the exchange operations, but it is ugly, inefficient and undermines the reputation. Meanwhile this is easy to get around. So usually acts Russian government, but not the West.
West, of course? prefer to put Bitcoin under control, same way as it gold was placed under the control in our times.
All you need is to have substantial reserves capable of tightly hold the course in tender corridor. Someone has bought up a fifth of the entire currency supply spending just 300 million. Price of the whole operation is 2 or 3 billion and this is not too high when it comes to survival of the state..

[yrashk]

I doubt it is really on anybody's radar in those echelons... too small of a threat. Not in a political sense, no. Not yet.

[jolly-roger]

I doubt it is really on anybody's radar in those echelons... too small of a threat. Not in a political sense, no. Not yet.

http://www.zerohedge.com/news/2013-05-06/us-regulatory-vice-closes-bitcoin

[DannyHamilton]

Over the last month somebody poured about $ 300 million into Bitcoins.
- snip -
Someone has bought up a fifth of the entire currency supply

What is your source of these two numbers?

[jolly-roger]

What is your source of these two numbers?

Price difference for April ~ 30$ per coin
entire BTC supply is 11M
BTC11M*$30=$330M

Average proce for April ~$120 per coin

$300M/$120 = BTC2 500 000
this is slightly more than fifth part of entire currency supply

An this is very conservative estimations. I think there was much more in reality.

[westkouse]

not same

[seannnyx]

I believe that if the bt states continue so we will try to censor it ... we'll see if they succeed, I do not think so

[DannyHamilton]

Over the last month somebody poured about $ 300 million into Bitcoins.
- snip -
Someone has bought up a fifth of the entire currency supply

What is your source of these two numbers?

Price difference for April ~ 30$ per coin
entire BTC supply is 11M
BTC11M*$30=$330M

Average proce for April ~$120 per coin

$300M/$120 = BTC2 500 000
this is slightly more than fifth part of entire currency supply

An this is very conservative estimations. I think there was much more in reality.

You misunderstand how valuations work.

Imagine the following:
entire supply is BTC11M
Bitcoin current price is $100
Suddenly everybody decides they don't want to sell their bitcoin for less than $130, and everyone with a limit order between $100 and $130 pulls their limit orders off of MtGox.
Someone places a Market order to buy BTC1
Order is filled at $130 for BTC1.
Bitcoin current price is therefore $130.

Note that the "price difference" in 10 minutes is $30, but this does not mean that "somebody poured about $300 million into Bitcoins".
One person "poured" exactly $130 into bitcoins.  That's all.

It also does not mean that "Someone has bought up a fifth of the entire currency supply".
One person bought 0.00000476% of the supply.

[jolly-roger]

Note that the "price difference" in 10 minutes is $30, but this does not mean that "somebody poured about $300 million into Bitcoins".
One person "poured" exactly $130 into bitcoins.  That's all.

you're right if there is only one person who spent $130, it means "somebody poured $130 into Bitcoins"

but if we have all those bitcoins owners in the market,  price would never stay at $130 after someone filled that order. All those bitcoins owners immediately sell all their coins as new price is more than they can hold. And in case if eventually price stay at 130 that would mean that all those buyers "poured about $300 million into Bitcoins

[RodeoX]

Why do you guys always think the state is out to get you, and your bitcoin?

[sharkbyte093]

Why kill what is essentially a totally traceable system of currency. Every transaction is recorded for the entire existence of bitcoin.

[jolly-roger]

Why kill what is essentially a totally traceable system of currency. Every transaction is recorded for the entire existence of bitcoin.

Do you think there will be any taxes in bitcoins?

[DannyHamilton]

Why kill what is essentially a totally traceable system of currency. Every transaction is recorded for the entire existence of bitcoin.

Do you think there will be any taxes in bitcoins?

Eventually? Yes.

[jolly-roger]

Why kill what is essentially a totally traceable system of currency. Every transaction is recorded for the entire existence of bitcoin.

Do you think there will be any taxes in bitcoins?

Eventually? Yes.

I am able to hide any my transactions in bitcoins. Nobody can oblige me to pay any taxes based on that. Only property taxes will be possible.

[DannyHamilton]

Why kill what is essentially a totally traceable system of currency. Every transaction is recorded for the entire existence of bitcoin.

Do you think there will be any taxes in bitcoins?

Eventually? Yes.

I am able to hide any my transactions in bitcoins. Nobody can oblige me to pay any taxes based on that. Only property taxes will be possible.

How is this any different than transactions in cash?  You can take a risk and avoid reporting cash transactions (or bitcoin transactions), but if you get caught the penalties will be stiff.  Most people will fulfill their legal obligations as report their income and pay taxes on it, just like most cash businesses do.

[jolly-roger]

Why kill what is essentially a totally traceable system of currency. Every transaction is recorded for the entire existence of bitcoin.

Do you think there will be any taxes in bitcoins?

Eventually? Yes.

I am able to hide any my transactions in bitcoins. Nobody can oblige me to pay any taxes based on that. Only property taxes will be possible.

How is this any different than transactions in cash?  You can take a risk and avoid reporting cash transactions (or bitcoin transactions), but if you get caught the penalties will be stiff.  Most people will fulfill their legal obligations as report their income and pay taxes on it, just like most cash businesses do.

Most people would never pay taxes if they can avoid punishment. I have seen the proof of that in reality in 90th in Russia.

Differerence than transaction in cash is the same as transactions in golden coins in middle ages. Perhaps you remember that there were some issues with taxation and the property tax was basic. Role of banks also will change as people will not need banks anymore for transactions. So nobody will report about transactions.

[jamesblack]

I do not think will do it .......... bt is now the party does not stop and more