Please stop asking for "legal tender status"

[Plaguedeath]

I don’t think any Americans will be forced to accept Bitcoin anytime soon. The Lightning network is unreliable and just plain terrible for use in a large country while the main layer couldn’t dream of supporting so many transactions. I won’t even go into the technical challenges for people who might not know how to use a computer… Legal status isn’t something that needs to worried about right now.

There's no need to use lightning network if the government want to accept Bitcoin as legal tender, they can just create their own centralized exchange, and force the citizens to use that exchange as their wallet, just like Chivo in El Salvador. They only need to install the application without need to care about the technical thing, pretty much like other applications where you only need to remember your email/username and your password.

[1714712899]

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[1714712899]

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[TravelMug]

I don’t think any Americans will be forced to accept Bitcoin anytime soon. The Lightning network is unreliable and just plain terrible for use in a large country while the main layer couldn’t dream of supporting so many transactions. I won’t even go into the technical challenges for people who might not know how to use a computer… Legal status isn’t something that needs to worried about right now.

There's no need to use lightning network if the government want to accept Bitcoin as legal tender, they can just create their own centralized exchange, and force the citizens to use that exchange as their wallet, just like Chivo in El Salvador. They only need to install the application without need to care about the technical thing, pretty much like other applications where you only need to remember your email/username and your password.

I think he was just trying to give a example about how the government of the US will do. And so there are not force acceptance if ever bitcoin will be legal tender. You can choose what and how you want to used it, as money, assets, hedge against the current status of the economy. Remember though that in El Salvador, even if Bukele won the reelection, he can't force as well 100% of the population to used BTC. We already have the approval of Bitcoin Spot ETF in the US, I think it's big enough to say that Bitcoin will stay and will be look at it as something that is legitimate as US still wields great influence in the financial world.

[OcTradism]

I think he was just trying to give a example about how the government of the US will do. And so there are not force acceptance if ever bitcoin will be legal tender. You can choose what and how you want to used it, as money, assets, hedge against the current status of the economy. Remember though that in El Salvador, even if Bukele won the reelection, he can't force as well 100% of the population to used BTC. We already have the approval of Bitcoin Spot ETF in the US, I think it's big enough to say that Bitcoin will stay and will be look at it as something that is legitimate as US still wields great influence in the financial world.

Bitcoin transactions can be broadcasted and confirmed borderless so you can use your bitcoin anywhere. If you use no-KYC exchanges, you don't have to concern about legal tender status of Bitcoin in a location, nation you are living in.

Running a Bitcoin full node, with Tor, is not expensive and it will help you increasing your privacy.

[Guide] How to run a Bitcoin Core full node for under 50 bucks!

[retreat]

Bitcoin becoming legal tender only happened in El Salvador and the Central African Republic, apart from that other countries only consider that Bitcoin can be used as a trading and investment instrument by their citizens. Being legal tender means that Bitcoin can be used as a means of payment for goods or services in that country, whereas in countries that only consider Bitcoin as a trading instrument you cannot use Bitcoin to buy goods or pay for services and violating this will result in penalties. So there is a real difference when Bitcoin's status becomes legal tender and when Bitcoin is only a trading instrument in a country.

[yazher]

Bitcoin becoming legal tender only happened in El Salvador and the Central African Republic, apart from that other countries only consider that Bitcoin can be used as a trading and investment instrument by their citizens. Being legal tender means that Bitcoin can be used as a means of payment for goods or services in that country, whereas in countries that only consider Bitcoin as a trading instrument you cannot use Bitcoin to buy goods or pay for services and violating this will result in penalties. So there is a real difference when Bitcoin's status becomes legal tender and when Bitcoin is only a trading instrument in a country.

It's enough for us to have bitcoins in our country as something that is not banned considering it complex for some people because whenever we want to buy, we can just easily access our local exchanges and simply buy them whereas in other countries they don't have this options because of tight rules and regulations when it comes to owning bitcoins and they surely face legal charges if they caught red-handed. The only problem that we wish they didn't implement is the huge tax for the bitcoin owners, so far in some countries as well this is not a problem but they cannot make sure that it will last long.

[kryptqnick]

Legal tender means that the government forces everybody to accept Bitcoin whether they want to or not.

Totally wrong, a legal tender is a type of payment that a country considers as legal and its law allow it to be used to settle debts which simply means a type of asset that can be used for financial things. A country never force you to use a legal tender but if you live in a country then you need to use it for trading of goods.

Actually, the op is kind of right. According to Merriam-Webster, legal tender is "money that is legally valid for the payment of debts and that must be accepted for that purpose when offered". I've also seen similar definitions in other dictionaries, including a Google prompt based on Oxford dictionaries that you'll get if you google the meaning of legal tender. If something is legal tender, it means that it must be accepted as payment. So it's not obligatory for customers (if there's a different legal tender as well), but merchants are obliged to accept such payments, meaning, in case of Bitcoin, that they must have some wallets, at the very least, to accept such payments. So there is an element of force here, and it's understandable that some might be against such policies.

[legiteum]

Bitcoin becoming legal tender only happened in El Salvador and the Central African Republic, apart from that other countries only consider that Bitcoin can be used as a trading and investment instrument by their citizens. Being legal tender means that Bitcoin can be used as a means of payment for goods or services in that country, whereas in countries that only consider Bitcoin as a trading instrument you cannot use Bitcoin to buy goods or pay for services and violating this will result in penalties. So there is a real difference when Bitcoin's status becomes legal tender and when Bitcoin is only a trading instrument in a country.

That is simply not true. Bitcoin is already perfectly legal to be used as a means of payment of goods or services in most countries across the world.

The reason why people don't use Bitcoin to pay for ordinary things is because transactions are far too slow and far too expensive. Why would anybody pay for their $5 cup of Starbucks coffee with something that takes 30 minutes and costs $30 to complete a transaction?

Asking the government to force Bitcoin down people's throats like you are asking them to do here isn't going to help. Most people in El Salvador don't use Bitcoin for anything even though the government there literally used taxpayer money to bribe them into doing so and passed a law saying everybody must accept Bitcoin.

It's enough for us to have bitcoins in our country as something that is not banned considering it complex for some people because whenever we want to buy, we can just easily access our local exchanges and simply buy them whereas in other countries they don't have this options because of tight rules and regulations when it comes to owning bitcoins and they surely face legal charges if they caught red-handed. The only problem that we wish they didn't implement is the huge tax for the bitcoin owners, so far in some countries as well this is not a problem but they cannot make sure that it will last long.

While there are a few countries where individual ownership and trading of Bitcoin is banned, that list is very short. For almost all of the world's economy, there are no significant restrictions on Bitcoin.

And in the US at least, there's no taxes on Bitcoin that aren't present on every other kind of investment. It sounds like you might be asking for a tax break just because you chose to invest in Bitcoin as opposed to other investments, but that's not very fair to others.

[famososMuertos]

....
It is also perfectly legal to use barter to pay for things in most countries. ....

No, that's the point, you didn't understand the situation well, barter is not legal, you cannot put in a commercial purchase and sale document that you delivered a Picasso painting, for example.  There are taxes to pay etc.

Do not confuse this with inheritance or transfer of property in case of any others nature

In my country, barter is not accepted, nor is bitcoin, it is illegal, for formal payments.

Now, the dollar is not the legal currency in circulation, but it is accepted for formal, legal payments.

[legiteum]

....
It is also perfectly legal to use barter to pay for things in most countries. ....

No, that's the point, you didn't understand the situation well, barter is not legal, you cannot put in a commercial purchase and sale document that you delivered a Picasso painting, for example.  There are taxes to pay etc.

Do not confuse this with inheritance or transfer of property in case of any others nature

In my country, barter is not accepted, nor is bitcoin, it is illegal, for formal payments.

Now, the dollar is not the legal currency in circulation, but it is accepted for formal, legal payments.

In the USA at least, it's legal to buy something (using whatever means you want), but yes, you have to pay customary taxes. I wouldn't call this "illegal", but at minimum it's the same thing no matter how you buy it. I don't see why that would need to be any sort of impediment to using Bitcoin for payment as you are only doing what you'd need to do for any other kind of payment.

What country are you from that outlaws Bitcoin and barter?

[famososMuertos]

....
It is also perfectly legal to use barter to pay for things in most countries. ....

No, that's the point, you didn't understand the situation well, barter is not legal, you cannot put in a commercial purchase and sale document that you delivered a Picasso painting, for example.  There are taxes to pay etc.

Do not confuse this with inheritance or transfer of property in case of any others nature

In my country, barter is not accepted, nor is bitcoin, it is illegal, for formal payments.

Now, the dollar is not the legal currency in circulation, but it is accepted for formal, legal payments.

In the USA at least, it's legal to buy something (using whatever means you want), but yes, you have to pay customary taxes. I wouldn't call this "illegal", but at minimum it's the same thing no matter how you buy it. I don't see why that would need to be any sort of impediment to using Bitcoin for payment as you are only doing what you'd need to do for any other kind of payment.

What country are you from that outlaws Bitcoin and barter?

I think that the adjective "legal" does not have the same connotation in your country, no matter which one it is, but legal in my country requires that any transaction of purchase and sale of high-value goods and services be made in the currency of circulation that governs in the country. Since you have to justify the income of the money involved in said purchase, then banks, transfers, account deposits and/or checks are used for that, they cannot even be paid in cash.

So, bitcoin circulates in fact there is p2p, etc. but for "formal" procedures, payment is made in local currency or American dollars, and banks are used as essential to track the money involved.

Now, it exists in my country that someone sells or barters, yes, on the street, family, friends, etc. Anyone will receive what you give them as long as it has the exchange value.

But the above and I repeat, although bitcoin circulates as a valuable asset and exists for you to have, etc., is not allowed for legal, formal procedures, etc., that require a legal process from the state.

Now, the solution to that is, you sell "the Picasso painting" or "your bitcoins" to a third party and with that money you process the good you want to acquire in the Fiat currency or USD.

^{It's nice that you attend to your thread, and don't leave it abandoned, it is very rare for OP to stay active.}

[legiteum]

I think that the adjective "legal" does not have the same connotation in your country, no matter which one it is, but legal in my country requires that any transaction of purchase and sale of high-value goods and services be made in the currency of circulation that governs in the country. Since you have to justify the income of the money involved in said purchase, then banks, transfers, account deposits and/or checks are used for that, they cannot even be paid in cash.

So, bitcoin circulates in fact there is p2p, etc. but for "formal" procedures, payment is made in local currency or American dollars, and banks are used as essential to track the money involved.

Ah, that is a pain. But I suspect the issue is more practical, since tax must be calculated on purchases. I suspect they have a mechanism figured out so that foreigners can visit your country and use a credit card which has a balance in their own currency, and it does the exchange for you. I suspect somebody could create the same kind of technical solution with Bitcoin so that you pay the proper taxes for the transaction, using the current exchange rate.

But this is just a technical problem having to do with paying taxes, not a prohibition based on disliking Bitcoin, etc. And obviously a country needs to collect their taxes, so they are all going to have this problem no matter what form of remuneration one uses.

Now, it exists in my country that someone sells or barters, yes, on the street, family, friends, etc. Anyone will receive what you give them as long as it has the exchange value.

But the above and I repeat, although bitcoin circulates as a valuable asset and exists for you to have, etc., is not allowed for legal, formal procedures, etc., that require a legal process from the state.

Now, the solution to that is, you sell "the Picasso painting" or "your bitcoins" to a third party and with that money you process the good you want to acquire in the Fiat currency or USD.

People do the same thing with physical cash here in the US. Lots of smaller vendors say they only want cash, "wink wink", and we suspect it's because they don't want to pay taxes on the payment. But this only works for "small" amounts that the government probably wouldn't bother with. (Try to buy a new car or a house with physical cash and you'll wind up with the FBI knocking at your door!)

^{It's nice that you attend to your thread, and don't leave it abandoned, it is very rare for OP to stay active.}

Thank you. It's always interesting for me to hear viewpoints from all over the world.

[Darker45]

Let the people freely ask what they want to ask from the government. And let the government decide what they think is better for the nation and her people.

As far as I know, Salvadorans, the citizens of the beautiful El Salvador where Bitcoin is a legal tender, are not forced to use Bitcoin. Bitcoin is a legal tender there, meaning the people, businesses, the government itself may accept it. But since there is another legal tender which is the US dollar, everybody has the option to prefer the US dollar. It would certainly be a different case if Bitcoin is the sole legal tender of a country.

Anyway, worry not about governments controlling Bitcoin. It can never happen.

As I said above (and I provided a link where you can read about El Salvador and Bitcoin), they are not "really" implementing legal tender there because they don't enforce it. (And I suspect it's because they simply couldn't in practicality--and I further suspect that El Salvador did this as a publicity stunt, not real policy).

I don't worry about governments controlling Bitcoin--it's legal almost everywhere. But the only thing that could change that is a government forcing everybody to use it, which means they'd need to regulate it.

I wonder why you have to insist on your own definition of legal tender. You may be right, at least partly, but that's what it is. The lawmakers of El Salvador has passed a law which recognizes Bitcoin as a legal tender. You may agree or disagree with it or their implementation of it, but that's a fact. Bitcoin is a legal tender in El Salvador. You may continue to insist that it is not, but that doesn't change a thing.

How can a government regulate something they cannot have control over? At most, what they can regulate are businesses which make use of Bitcoin in one way or another.

[LogitechMouse]

I think a lot of people misunderstand what "legal tender" means.

Legal tender means that the government forces everybody to accept Bitcoin whether they want to or not.

Forcing? Since when did the definition of legal tender changed because based on Investopedia, this is the definition of legal tender:

Legal tender is anything recognized by law as a means to settle a public or private debt or meet a financial obligation, including tax payments, contracts, and legal fines or damages. The national currency is legal tender in practically every country.

I don't see the word "force" on that definition nor in the whole website. The government doesn't force you to use Bitcoin if it's a legal tender in the country. It's just that they are allowed to use to settle anything including debt or whatever it is. It's like an alternative option, and it's supported by the government.

Well, I'm a bit curious. Is there anybody here who is asking or begging Bitcoin to be a legal tender on their own country? I mean Bitcoin can be used by pretty much everybody in anything as long as the government don't interfere right? As long as they aren't banning it, they can be used in pretty much everything as long as 2 parties agreed to it. Legal tender for me isn't needed at all but correct me please if I said something wrong.

[legiteum]

I wonder why you have to insist on your own definition of legal tender. You may be right, at least partly, but that's what it is. The lawmakers of El Salvador has passed a law which recognizes Bitcoin as a legal tender. You may agree or disagree with it or their implementation of it, but that's a fact. Bitcoin is a legal tender in El Salvador. You may continue to insist that it is not, but that doesn't change a thing.

How can a government regulate something they cannot have control over? At most, what they can regulate are businesses which make use of Bitcoin in one way or another.

Well, "my" definition is based on place where the term originated, which is the US Constitution.

And I object to the use of this term for two reasons:

1. Bitcoin enthusiasts are insisting that governments force citizens to accept Bitcoin whether they want to or not.

and/or

2. Bitcoin enthusiasts insist that Bitcoin will become ubiquitous "as soon as Bitcoin becomes legal tender" even though most people don't understand what the term means, assume it just means "legal", and, wrongly, assume therefore that Bitcoin is not legal in most countries, which it most certainly is. And from this, they assume that what is holding it back from ubiquitous adoption as a payment method is government intervention, and not, say, the fact that Bitcoin transactions take 30 minutes and cost 30 dollars.

As for how a government would regulate Bitcoin, while I could probably think of a lot of ways, I would just say it's naive to think they wouldn't since they would be giving a single product in the marketplace near monopoly status, which means it would be beholden to the government.

And on that note, I guess if I had a third, less technical reason for objecting to people clamoring for giving Bitcoin legal tender status, is that it's inherently unfair: why Bitcoin and not, say, Ethereum, Dogecoin, other cryptos, or Haypenny currencies? Why should the government pick Bitcoin over all of those others?

People clamoring for "legal tender status for Bitcoin", for me at least, sounds like people wanting their favorite product (probably the one they have the most of in their investment portfolio) to be given special help from the government. I've said before here that Bitcoin has strayed very, very far from it's quasi-libertarian roots, but this would make Ayn Rand roll over in her grave...

Forcing? Since when did the definition of legal tender changed because based on Investopedia, this is the definition of legal tender:

Legal tender is anything recognized by law as a means to settle a public or private debt or meet a financial obligation, including tax payments, contracts, and legal fines or damages. The national currency is legal tender in practically every country.

I don't see the word "force" on that definition nor in the whole website. The government doesn't force you to use Bitcoin if it's a legal tender in the country. It's just that they are allowed to use to settle anything including debt or whatever it is. It's like an alternative option, and it's supported by the government.

Well, I'm a bit curious. Is there anybody here who is asking or begging Bitcoin to be a legal tender on their own country? I mean Bitcoin can be used by pretty much everybody in anything as long as the government don't interfere right? As long as they aren't banning it, they can be used in pretty much everything as long as 2 parties agreed to it. Legal tender for me isn't needed at all but correct me please if I said something wrong.

If you recognize a means of payment as a means to settle a public or private debt, that means the payee is forced to accept that mechanism of payment. If Bitcoin was made legal tender in the US, somebody could pay you in Bitcoin even if you didn't want to be paid in Bitcoin.

Like many here, you are confusing the concept of "legal to be used as a form of payment" (which Bitcoin is almost anywhere), and "legal tender", which is totally different.

And yes, I read these forums a lot, and lots and lots of people insist that Bitcoin should be made "legal tender", which is why I started this thread  .

I completely agree that it is not necessary, or even desirable.

[d5000]

I agree partly with the OP. This discussion shows that many really misunderstand the concept of a "legal tender".

But it's also not as black-and-white as you write, @legiteum. What a "legal tender" is, depends largely on the jurisdiction.

For example, in Bolivia I read there is a system similar to what @FamososMuertos described: every "formal" payment, i.e. every payment registered in the financial system, or every tax payment, has to be done with the national currency. What you do privately (i.e. buying Bitcoin from a friend, exchange Pokemons or other low-cost barter, etc.) is another story, these types of exchanges are also not prohibited but the financial system can't intermediate.

In other countries like Argentina and Germany instead, bartering and also paying with Bitcoin is not restricted in "formal" contracts and also the financial system can partly intermediate. But in Argentina there are financial entities which are banned to use Bitcoin (banks and "digital wallets"), and in Germany I read there are some restriction on high-valued goods which can only paid with the legal tender and additionally have to be paid electronically (i.e. not in cash).

So the assets you can use for payments and/or not is largely dependant on the country's legal system. In some, there's really a restrictive system where the legal tender is the only formally recognized way to do payments, while in others you can pay and barter with a lot of different assets.

About the government "forcing you to accept the legal tender": this was a matter of a heated debate in El Salvador, and the result (as I remind it) was that smaller shops are allowed to not accept it, and larger ones can always use the Chivo app to exchange Bitcoin instantly into fiat. So while there is often a kind of obligation to accept the legal tender, this is also not universal and there are often exceptions.

I disagree though that legal tender allows the governments to control Bitcoin itself. They can control the way contracts in Bitcoin are made, but not interfere in the technical aspects. They have to accept it as it is. They can also not force everybody to own it, only to accept it in some circumstances (e.g. in commerce) but even in El Salvador nobody is forced to hodl it. So no, I don't think there is any risk of "backfiring" if BTC is designated "legal tender".

[legiteum]

I agree partly with the OP. This discussion shows that many really misunderstand the concept of a "legal tender".

But it's also not as black-and-white as you write, @legiteum. What a "legal tender" is, depends largely on the jurisdiction.

For example, in Bolivia I read there is a system similar to what @FamososMuertos described: every "formal" payment, i.e. every payment registered in the financial system, or every tax payment, has to be done with the national currency. What you do privately (i.e. buying Bitcoin from a friend, exchange Pokemons or other low-cost barter, etc.) is another story, these types of exchanges are also not prohibited but the financial system can't intermediate.

In other countries like Argentina and Germany instead, bartering and also paying with Bitcoin is not restricted in "formal" contracts and also the financial system can partly intermediate. But in Argentina there are financial entities which are banned to use Bitcoin (banks and "digital wallets"), and in Germany I read there are some restriction on high-valued goods which can only paid with the legal tender and additionally have to be paid electronically (i.e. not in cash).

So the assets you can use for payments and/or not is largely dependant on the country's legal system. In some, there's really a restrictive system where the legal tender is the only formally recognized way to do payments, while in others you can pay and barter with a lot of different assets.

About the government "forcing you to accept the legal tender": this was a matter of a heated debate in El Salvador, and the result (as I remind it) was that smaller shops are allowed to not accept it, and larger ones can always use the Chivo app to exchange Bitcoin instantly into fiat. So while there is often a kind of obligation to accept the legal tender, this is also not universal and there are often exceptions.

I disagree though that legal tender allows the governments to control Bitcoin itself. They can control the way contracts in Bitcoin are made, but not interfere in the technical aspects. They have to accept it as it is. They can also not force everybody to own it, only to accept it in some circumstances (e.g. in commerce) but even in El Salvador nobody is forced to hodl it. So no, I don't think there is any risk of "backfiring" if BTC is designated "legal tender".

While it might be possible the term occurs somewhere deeper in history than the US Constitution, I'm pretty sure hardly anybody would know about those definitions. Since that's the case, I would call this a "US term", and thus the definition means what it means in the USA even internationally. In other words, by asking for "legal tender status" for Bitcoin, people are basically saying, "make Bitcoin like the US Constitution says the US dollar is".

I agree that all kinds of means of payment are regulated by governments, and when I say "legal" in conversation I mean, "as legal as any other form of payment". Obviously governments want their taxes, and they tax transactions, and they will always find a way to do that. But that goes for any form of payment, not just Bitcoin.

And yes, as I mentioned, El Salvador tried to go full "legal tender" with Bitcoin and it's been a fiasco--and they aren't fully enforcing their law.

And finally, while I wouldn't want to get into a long debate about how governments could control the use of Bitcoin in their country, I would just say that it's naive to think they couldn't. Obviously this doesn't mean changing the Bitcoin codebase, but they wouldn't have to.

[Darker45]

I wonder why you have to insist on your own definition of legal tender. You may be right, at least partly, but that's what it is. The lawmakers of El Salvador has passed a law which recognizes Bitcoin as a legal tender. You may agree or disagree with it or their implementation of it, but that's a fact. Bitcoin is a legal tender in El Salvador. You may continue to insist that it is not, but that doesn't change a thing.

How can a government regulate something they cannot have control over? At most, what they can regulate are businesses which make use of Bitcoin in one way or another.

Well, "my" definition is based on place where the term originated, which is the US Constitution.

And I object to the use of this term for two reasons:

1. Bitcoin enthusiasts are insisting that governments force citizens to accept Bitcoin whether they want to or not.

and/or

2. Bitcoin enthusiasts insist that Bitcoin will become ubiquitous "as soon as Bitcoin becomes legal tender" even though most people don't understand what the term means, assume it just means "legal", and, wrongly, assume therefore that Bitcoin is not legal in most countries, which it most certainly is. And from this, they assume that what is holding it back from ubiquitous adoption as a payment method is government intervention, and not, say, the fact that Bitcoin transactions take 30 minutes and cost 30 dollars.

As for how a government would regulate Bitcoin, while I could probably think of a lot of ways, I would just say it's naive to think they wouldn't since they would be giving a single product in the marketplace near monopoly status, which means it would be beholden to the government.

And on that note, I guess if I had a third, less technical reason for objecting to people clamoring for giving Bitcoin legal tender status, is that it's inherently unfair: why Bitcoin and not, say, Ethereum, Dogecoin, other cryptos, or Haypenny currencies? Why should the government pick Bitcoin over all of those others?

People clamoring for "legal tender status for Bitcoin", for me at least, sounds like people wanting their favorite product (probably the one they have the most of in their investment portfolio) to be given special help from the government. I've said before here that Bitcoin has strayed very, very far from it's quasi-libertarian roots, but this would make Ayn Rand roll over in her grave...

1. You've done a good job promoting whatever it is.

2. Legal tender didn't originate in the US. Neither did the constitution. Neither did the English language. Neither did anything else. But the real Nayib Bukele is on Twitter; you can actually reach out to him, "Hey, Mr. President, you should do things the way we do them over here in 'Merica!"

3. 99% of Bitcoin enthusiasts are here for the money. You can actually ignore them.

4. Out of those "lot of ways" that a government can regulate Bitcoin, you can actually give us 3.

[legiteum]

4. Out of those "lot of ways" that a government can regulate Bitcoin, you can actually give us 3.

Okay, fine. Off the top of my head:

1. A government could create a network of citizen spies wherein they give any citizen ten thousand dollars if they give information about any fellow citizen using Bitcoin, wherein the fellow citizen would be arrested and imprisoned for 20 years.

2. A government could setup a network of honeypot agents all over the Internet in order to catch its citizens using Bitcoin illegally, wherein if they are caught doing so they are imprisoned for 20 years.

3. A government could monitor Internet traffic transpiring within its borders and detect connections to Bitcoin servers.

Governments have guns and prisons on their side. You really can't win.

[franky1]

Okay, fine. Off the top of my head:

1. A government could create a network of citizen spies wherein they give any citizen ten thousand dollars if they give information about any fellow citizen using Bitcoin, wherein the fellow citizen would be arrested and imprisoned for 20 years.

2. A government could setup a network of honeypot agents all over the Internet in order to catch its citizens using Bitcoin illegally, wherein if they are caught doing so they are imprisoned for 20 years.

3. A government could monitor Internet traffic transpiring within its borders and detect connections to Bitcoin servers.

Governments have guns and prisons on their side. You really can't win.

to add to this

1a. the IRS already offers bounties to citizen spies
1b. when the bitlicence first came out. if a NY service without licence operated, users could report it
1c. when the bitlicence first came out, NY DFS agents using NY geo-located pc's would check international businesses without bitlicence to see if the blocked NY citizens, and if not they got caught

2. when unregulated(binance) operated in the US without registering with SEC, agents actually would sign up to binance to see if they got blocked. and if able to get an account binance got caught

3. much like police can monitor homes that use excessive electric to identify weed farms. or see homes in infrared that produce too much heat for identifying weed farms, unregulated services not licenced under legislation can be found via many means. (much like 1&2).
but just swapping data over the internet does not equal serving customers in a legislative controlled area requiring licences/conditions of use, but can be used to identify possible targets to then do 1&2 prove licence evasion

[glendall]

Legal tender means that the government forces everybody to accept Bitcoin whether they want to or not.

the words "legal tender" for bitcoin do not mean that it must be accepted by everyone. because bitcoin is different from fiat
Indeed, the government does not legalize Bitcoin, but it does not prohibit Bitcoin transactions, and even then only certain shops or people accept it without any coercion.