What if Bitcoin was a currency?

[Alley]

What would be the difference?  Tax laws?

[1715593264]

1715593264

[1715593264]

1715593264

[1715593264]

1715593264

[1715593264]

1715593264

[durrrr]

public acceptence and knowledge of it being a currency and people using it day to day. and also taxing would be a huge thing that idk how they would do it

[hilariousandco]

It is a currency. Do you mean if it was fully adopted as a main currency or something?

[Alley]

I mean according to the IRS.

[durrrr]

It is a currency. Do you mean if it was fully adopted as a main currency or something?

i was assuming he ment adopted as like a world wide used currency. where you could use it anywhere

[MoonShadow]

I mean according to the IRS.

As opposed to being considered property?  Well, if Bitcoin were a currency under US law, it'd be comparable to the Euro.  Paying employees in foreign currencies, such as the Euro, within the United States carries different taxation rules than property, so the taxes (in general) would be higher than it is for property.

[Joshuar]

Bitcoin isn't stable enough to be a currency..Bitcoin is just a prototype, once a better coin comes out or maybe it's out already? will replace Bitcoin and render it useless. Now that new coin will be a currency.

[hilariousandco]

I mean according to the IRS.

Well then the laws would probably be the same as for what we currently have for fiat taxation.

[CoinRocka]

Bitcoin isn't stable enough to be a currency..Bitcoin is just a prototype, once a better coin comes out or maybe it's out already? will replace Bitcoin and render it useless. Now that new coin will be a currency.

good luck new coin 

[MoonShadow]

Bitcoin isn't stable enough to be a currency..Bitcoin is just a prototype, once a better coin comes out or maybe it's out already? will replace Bitcoin and render it useless. Now that new coin will be a currency.

Good luck with that.

[lynn_402]

Bitcoin isn't stable enough to be a currency..Bitcoin is just a prototype, once a better coin comes out or maybe it's out already? will replace Bitcoin and render it useless. Now that new coin will be a currency.

What's making it unstable has nothing to do with how Bitcoin works, it's simply because of lack of trading volume which causes instability.
Prices fluctuation are perfectly normal for a technology this young, and I don't see any altcoin behaving differently.

[hilariousandco]

Bitcoin isn't stable enough to be a currency..Bitcoin is just a prototype, once a better coin comes out or maybe it's out already? will replace Bitcoin and render it useless. Now that new coin will be a currency.

What's making it unstable has nothing to do with how Bitcoin works, it's simply because of lack of trading volume which causes instability.
Prices fluctuation are perfectly normal for a technology this young, and I don't see any altcoin behaving differently.

It's panic sellers that make it unstable, but it's to be expected with something as relatively new as Bitcoin. Hopefully it'll become stable at some point, but even fiat currencies fluctuate.

[lynn_402]

but even fiat currencies fluctuate.

Yep, even with all the political and economical power, and all the armies in the world, engaged at keeping their values stable. No wonder Bitcoin fluctuates

[twiifm]

To answer the OP.   If you kept cash in your mattress it doesn't get taxed.   You get taxed as income when you first receive it.

If you keep money in assets those assets may get capital gains tax or ordinary income depending on how long you hold

[redwhite037]

So would the taxes be worse if bitcoin was considered property or a currency? I've been pondering this lately.

[twiifm]

So would the taxes be worse if bitcoin was considered property or a currency? I've been pondering this lately.

You pay taxes on income.   Capital gains have cap at 15% I believe.   Ordinary income is based on tax bracket.

We are taxed in dollars.   If you bought a bitcoin a year ago for $1 and now its $600.  If you sell it you get taxed on $599 as ordinary income.  But tax rate depends on all your other income combined

If you don't sell it there is a cap of 15%. 

[sergio]

Bitcoin is a currency, it is by design and by definition of the creator.

So far it is the best we have, it could be more anonymous, and we could have decentralized exchanges.

As far as the IRS they can call it anything they wish, it odes not matter bitcoin goes beyond the jurisdiction of the IRS, and there is no government that rules for the entire planet. Bitcoin does not know about borders, it does not care about politics, it is base on math applied using software, using the Internet.

As far as I am concerned the IRS/GOV could rule that 1 + 1 =3, but for me it would still be 2, only legally it would be 3, then math teachers would have to put a disclaimer on the math exams saying "the law for exam purposes does not apply".
The same is happening to bitcoin, it is a currency but not legally.

The US government will never allow a competing currency, specially a better, and that is exactly what bitcoin is, so they relabel bitcoin so it is by law not a currency.

This is really bad, the gov/IRS is basically saying "you are not allowed to have a competing currency and must pay the inflation, war tax"

Well my guest is that in the spirit of satoshi, and freedom most of us will not subject ourself to the inflation tax and to the IRS nonsense, the bookkeeping will be a nightmare.

A better law would be something like saying " all laws that apply to the dollar apply to bitcoin" and level the playing field.

With the dollar when it appreciates or depreciates in value you do not have to pay/unpay additional taxes, well it normally devalues itself and it can not be claim as a loss for tax purposes.

One of the purposes of Bitcoin was to avoid the inflation tax created by the abuses of the debasement of the dollar, euro, and most fiat currencies (possibly all gov fiat).

This new tax is to subsidize the dollar, and the dollar subsidizes the FED, which it subsidize  the  Central Banks, in other words is a tax for the welfare for the very rich, one of the very thing bitcoin was designed to avoid.

The good news is that the IRS property tax is not enforceable. Therefore  my guess is that the IRS will go after the big money by harassing  companies that deal with bitcoins, eventually this will hurt the USA since if they get overly aggressive it will drive the good money out of the US and that is something that they do not want, what they want is to protect the dollar, encourage business to transact only in dollars, and collect as much tax as possible.

Only time will tell what will happen, this could help drive the price of darkcoin up.

The volatility of bitcoin will go away with time, if you notice now bitcoin is a lot less volatile than its early years.

The US constitution allows for competing currencies, then why is it that the US government breaks the law by not allowing them.

Some day the IRS may want to tax my "cumpa coin".

[BitEscrow]

 Good luck. Sadly people hear are too stupid to realize they don't make the rules. Wake up you stubburn cunts, you live off the govs. rules. Pay your taxes you cheap fucks.

[roslinpl]

What would be the difference?  Tax laws?

Imagine digitalizing a $ - will be same as bitcoin as a currency.


Anyway, bitcoin will stay cryptocurrency forever I really hope!

[durrrr]

bitcoin will be a currency someday maybe not exactly like the usd but it will be a widely used an accepted form of payment that can easily be converted to fiat

[keithers]

It is a currency. Do you mean if it was fully adopted as a main currency or something?

It basically is a currency if you interpret the definition of a currency literally.   You cannot typically buy things with property (without bartering), nor can you flip your physical property into fiat (without a pawn shop)...

[southerngentuk]

Lets all pitch in and buy a sovereign Island, declare its official currency as bitcoin.

Setup our own exchange there and a data center to host pools.

Think of the press that would get  

Just need to find an Island now  

Edit : Forget the Island, Bitcoin to the Moon ^^

[JohnnyBTCSeed]

Lets all pitch in and buy a sovereign Island, declare its official currency as bitcoin.

Setup our own exchange there and a data center to host pools.

Think of the press that would get  

Just need to find an Island now  

Edit : Forget the Island, Bitcoin to the Moon ^^

http://www.seasteading.org/

[counter]

If by currency you mean excepted by the vampire parasitic system and brought mainstream so users can be taxed to death and a small group of scum can control it...  

[Bit_Happy]

Bitcoin is a currency...
Don't let the Gov create your reality.

[cheri0]

it would be very cool if it become more convinient in usage, and if it's accepted everywhere in the world

[BitOnyx]

Modern understanding of currency is something issued by state.

I hope it won't be currency, I prefer it as meta currency.

[Eastwind]

If BTC is a property, not a currency, would Money Transfer Business licence still be applied?

[S4VV4S]

Can someone explain to me HOW Bitcoin is property?
What kind of property? Intellectual?
Or like a house or a car? Which you can touch.
Because even if it is intellectual property it does NOT belong to anyone else other than it's creator, and that is Satoshi.
Am I wrong here?

[cbeast]

Can someone explain to me HOW Bitcoin is property?
What kind of property? Intellectual?
Or like a house or a car? Which you can touch.
Because even if it is intellectual property it does NOT belong to anyone else other than it's creator, and that is Satoshi.
Am I wrong here?

The USA motto is "In God We Trust." Any other questions about what they believe is real?

[counter]

Bitcoin is a currency...
Don't let the Gov create your reality.

Well said , I have to admit my previous posts was subconsciously influenced by the "news" in this thread.  Thanks for pointing it out.   

[hilariousandco]

Can someone explain to me HOW Bitcoin is property?

I dunno, probably property as in you own it; it's a thing.

[chufchuf]

Bitcoin isn't stable enough to be a currency..Bitcoin is just a prototype, once a better coin comes out or maybe it's out already? will replace Bitcoin and render it useless. Now that new coin will be a currency.

No need for that when you've already got banks/paypal and the dollar. As if the coin wouldn't be the same exact thing as logging online to your government-run bank/paypal...

[S4VV4S]

Can someone explain to me HOW Bitcoin is property?

I dunno, probably property as in you own it; it's a thing.

That is exactly my point.
I own a lot of virtual products but they are not considered my "property", they are considered virtual products which I happened to have purchased and use(d) <-- And by law that is the only thing I am allowed to do with my legally purchased virtual products.
If there is ANY property rights involved it's intellectual property which belongs to the company that sold it to me.

And I am still confused about the "property" thing regarding Bitcoin.
They could have classified it as a virtual product and TAX it... but property??.....
Common......

[hilariousandco]

Can someone explain to me HOW Bitcoin is property?

I dunno, probably property as in you own it; it's a thing.

That is exactly my point.
I own a lot of virtual products but they are not considered my "property", they are considered virtual products which I happened to have purchased and use(d) <-- And by law that is the only thing I am allowed to do with my legally purchased virtual products.
If there is ANY property rights involved it's intellectual property which belongs to the company that sold it to me.

And I am still confused about the "property" thing regarding Bitcoin.
They could have classified it as a virtual product and TAX it... but property??.....
Common......

I think the people who makes these laws don't adhere to logic.

[ShawnLeary]

What if, a small nation with its own currency, let's say Solomon Islands, decided to forgo their own Solomon Islands dollar (SBD) as their currency and adopt Bitcoin as their reserve currency?  At this point, wouldn't every other UN nation have to appreciate Bitcoin as a currency and treat it as such?

The amount of money saved by some of the early adopters, in terms of capital gains, might be enough to actually go and buy the Solomon Islands to make this happen

[chennan]

Bitcoin isn't stable enough to be a currency..Bitcoin is just a prototype, once a better coin comes out or maybe it's out already? will replace Bitcoin and render it useless. Now that new coin will be a currency.

OP means what if.

[chennan]

Can someone explain to me HOW Bitcoin is property?

I dunno, probably property as in you own it; it's a thing.

That is exactly my point.
I own a lot of virtual products but they are not considered my "property", they are considered virtual products which I happened to have purchased and use(d) <-- And by law that is the only thing I am allowed to do with my legally purchased virtual products.
If there is ANY property rights involved it's intellectual property which belongs to the company that sold it to me.

And I am still confused about the "property" thing regarding Bitcoin.
They could have classified it as a virtual product and TAX it... but property??.....
Common......

I think BTC is special virtual product. The law makers just want to classify it under current law and can't claim it to be currency. So they can better regulate and tax it.

[lihuajkl]

but even fiat currencies fluctuate.

Yep, even with all the political and economical power, and all the armies in the world, engaged at keeping their values stable. No wonder Bitcoin fluctuates

True. Once it becomes currency, the price of BTC would be more stable and less fluctuate. People around the world are willing to buy and keep it.

[MegaHustlr]

Lets all pitch in and buy a sovereign Island, declare its official currency as bitcoin.

Setup our own exchange there and a data center to host pools.

Think of the press that would get  

Just need to find an Island now  

Edit : Forget the Island, Bitcoin to the Moon ^^

It would be complete chaos without a proper government. The island's population would probably die off within a few months....

[jonald_fyookball]

Very little would change as far as taxes.

There are a few somewhat complicated tax laws regarding what rates you
pay on foreign exchange (forex) profits or losses, that would be then applied
To bitcoin profits or losses would it have been declared currency. (For example, the 60/40
rule which blends long term and short term capital gains rates.)

I'm guessing the main reason why bitcoin is declared as a property is simply that
the powers that be do not want to legitimize bitcoin
To the extent of officially calling it currency.

Also, had it been declared currency, it may have fallen under more stringent regulations
as far as who can set up an exchange or brokerage, so it is probably a good thing.

[Bit_Happy]

Lets all pitch in and buy a sovereign Island, declare its official currency as bitcoin.

Setup our own exchange there and a data center to host pools.

Think of the press that would get  

Just need to find an Island now  

Edit : Forget the Island, Bitcoin to the Moon ^^

It would be complete chaos without a proper government. The island's population would probably die off within a few months....

Excuse me, but these days 'chaos' comes from the existence of "proper government". Free markets with very little Gov't (more libertarian than any current country) can do much better than what we see in the world today.

[2double0]

Lets all pitch in and buy a sovereign Island, declare its official currency as bitcoin.

Setup our own exchange there and a data center to host pools.

Think of the press that would get  

Just need to find an Island now  

Edit : Forget the Island, Bitcoin to the Moon ^^

It would be complete chaos without a proper government. The island's population would probably die off within a few months....

Excuse me, but these days 'chaos' comes from the existence of "proper government". Free markets with very little Gov't (more libertarian than any current country) can do much better than what we see in the world today.

And that would attract criminals to the island, no thank you from me to live there.
dub

[Meuh6879]

What would be the difference?  Tax laws?

No DEBT.
No INFLATION.

[jc01480]

What would be the difference?  Tax laws?

No DEBT.
No INFLATION.

Got your own sewage treatment, water supply, food sources, electricity, road paver?  C'mon, get real.

[StevenS]

Can someone explain to me HOW Bitcoin is property?

"Property" is treated as follows under US tax law:

When you buy it, you don't pay tax;
When you use it, you don't pay tax;
When you lose it, you don't pay tax;
When you sell (or exchange) it, you pay a tax based on its capital gain, which is defined as its value (in USD) when you sold it, minus its value (again, in USD) when you obtained it.

For tax purposes, BTC is pretty much like stock in a public company.

It's not like physical property, because it doesn't depreciate, and isn't used in business (like furniture or paper, for example).

Please correct me if I'm be wrong, but I don't think Bitcoin is subject to property tax.

I think the big difference between property and currency is when you use it to buy something. Since by US law it's property, you have to record its value (in USD) when you use it to purchase something, in order to correctly calculate capital gain. If it were currency, you wouldn't have to do this, but would wait until the end of your tax year and then figure out how much you have left and how much it's worth.

It seems to me that it's complicated either way, but there are many systems in place that can calculate your taxes when you deal with foreign currencies, so it would be much easier if BTC was in the same class. Usually, when tax entities (e.g. you) sell property such as inventory, real property, tangible property, or securities (e.g. stock), it is exchanged for USD, which makes the accounting fairly simply. If BTC is exchanged for something such as lunch, there isn't an easy way to put that in your books.

[jonald_fyookball]

Can someone explain to me HOW Bitcoin is property?

Please correct me if I'm be wrong, but I don't think Bitcoin is subject to property tax.

That would make sense since property tax is generally assessed locally.

[Ron~Popeil]

What would be the difference?  Tax laws?

No DEBT.
No INFLATION.

Got your own sewage treatment, water supply, food sources, electricity, road paver?  C'mon, get real.

Government is not the only entity capable of providing services. This idea that we somehow only became a civilization because of governments is truly a sad statement on how comfortable we have gotten under their ever growing boot.

[jbreher]

Got your own sewage treatment, water supply, food sources, electricity, road paver?  C'mon, get real.

Government is not the only entity capable of providing services. This idea that we somehow only became a civilization because of governments is truly a sad statement on how comfortable we have gotten under their ever growing boot.

Indeed. The 'food sources' is especially funny. Or it would be, would it not be for the worry that this is indeed where we're headed.