[LINK] Two articles on Bitcoin

David_Gerard

[LINK] Two articles on Bitcoin — LessWrong

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I'm not sure I agree. Firstly, I bet that people have laundered plenty of money using online poker, and failed to report taxes on a lot of it, too. (Although obviously there's a difference in scale between a proposed new replacement currency and poker players' chips, and Bitcoin's anonymity makes it much easier.)

Secondly, what makes it much easier to evade taxes by failing to report Bitcoin payments than evade taxes by failing to report cash or check payments? Taxes work because enough companies and individuals pay them voluntarily that the cheaters can be cross-checked into oblivion. I don't see why people would be more likely to cheat if they were transacting in Bitcoin instead of cash.

Consider also the USG's attempts to enforce IP laws. Lots of sound and fury, but totally ineffective so far in actually curbing copyright infringement by individuals. And you know a lot of lobbyist money must be going towards trying to get those laws working. If people ever care about using Bitcoin as much as they care about downloading an album quickly and easily, then it seems to me that government is in trouble.

timtyler15y00

Secondly, what makes it much easier to evade taxes by failing to report Bitcoin payments than evade taxes by failing to report cash or check payments? Taxes work because enough companies and individuals pay them voluntarily that the cheaters can be cross-checked into oblivion. I don't see why people would be more likely to cheat if they were transacting in Bitcoin instead of cash.

Cash is pretty anonymous, but also pretty useless for paying people over the internet. Cheques typically leave an audit-friendly paper trail.

4David_Gerard15y

Taxes work because people like me - highly-paid middle-class employees - find them almost impossible to dodge. Everyone else is the fluff on the side - it's PAYE (pay-as-you-earn, where taxes are withheld from your earnings) employees who are the backbone of government revenue. And, increasingly, sales taxes. In both cases, the pressure point is businesses, of which there are far fewer than there are citizens.

3RHollerith15y

Really? OK, I will assume you're serious and not joking. A check is drawn on a bank or savings and loan or such, and banks, etc, are heavily regulated and audited by government. As for cash, the U.S. government makes it inconvenient to pay someone or be paid by someone in cash with "Know Your Customer" banking regulations. They try to make it so that the inconvenience and risk increases at least linearly with the amount of cash involved. Copyright infringement and gambling do not have the potential to seriously reduce governmental revenue. Consequently, the most competent bureaucrats have not been assigned to controlling those things like they have or will be assigned to controlling Bitcoin. The U.S. response to infringement has been conducted mostly by the legislature and the judical branch. It would be a lot more effective if the most competent parts of the executive branch, e.g., the Secret Service and the Treasury Department, made it a priority. Disclaimer: I haven't studied Bitcoin so these comments should be taken as my rationale for not making the effort to study it.

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[LINK] Two articles on Bitcoin

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[LINK] Two articles on Bitcoin

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