Air Guitars and Bitcoin Regulation
|Views: 78
|Likes: 0
Publicado porJon Matonis
Where are your bitcoins Mr. Anarchist? Well sir, they are right over there stacked next to my new air guitar. What, you don't see them? I swear that they are there.
Where are your bitcoins Mr. Anarchist? Well sir, they are right over there stacked next to my new air guitar. What, you don't see them? I swear that they are there.
More info:
Availability:
See more
See less
TheMonetaryFuture:AirGuitarsandBitcoinRegulationhttp://themonetaryfuture.blogspot.com/20
III
11/air-guitars-and-bitcoin-...
AirGuitarsandBitcoinRegulation
ByJonMatonisNoonereally
sends
or
receives
bitcoin.Theymerelytransfertheirownershipandspecificcontrolrightstotheblockchainonthegiantpublicledgerinthecloud.It'slikeanairguitar.Thebitcoinitselfexistsbecauseweallsaythatitexists.Thesamecanbesaidofbitcoin'sexchangevalue-ithasvaluebecauseweallsaythatithasvalue.Thatisbothitsweaknessanditsbrilliance.Itsintangibilitypreventsitsconfiscation.WhereareyourbitcoinsMr.Anarchist?Wellsir,theyarerightovertherestackednexttomynewairguitar.What,youdon'tseethem?Iswearthattheyarethere.Idon'tthinkgovernmentswilleverdeclarethattheycanseethemtoo!Becauseifgovernmentsdidseethem,thenbitcoinwouldbeimputedwithtremendous
legal
monetaryvalueandtheydon'twanttodothat.Governmentswillwanttodiminishthecredibilityofbitcoin-notenhanceit.Now,totheexchanges.Thisiswheretheenforcementandregulationswillhitfirst.Tradingbitcoininandoutofnationalcurrenciesiscurrentlynecessarybecausemanytransactionsstillhavetobesettledinthatmanner.Ofcourse,thiswilladjustovertimeasmoreandmorebitcoinvaluecanremaininthebitcoinecosystemfornecessarydailytransactions.Butinthemeantime,regulationisincreasinglypossibleinthisareaduetoexchangesrequiringacertaindegreeofjurisdictionalpresenceandcentralization.
As
withbuyingandsellingairguitarsoneBay,regulatorscanexertinfluencebecausethereisacentralizedpointofexchange.
It
mattersnotwhatisbeingexchanged.
RegulatoryBiasWithSome
in
theBitcoinCommunity
"WeareworkingwiththegovernmenttomakesureindeedthelongarmofthegovernmentcanreachBitcoin."
--JeffGarzik,BitcoinDeveloper
"Regulationwouldallowtheproperauthoritiestofindandchargethosewhousebitcoinsforillegalactivities."
--AmirTaaki,Co-founderofBitcoinConsultancy
''Norman
is
pushingtobringBitcoinawayfromitsrootsandclosertoatraditionalcurrency-he
is
reachingouttoregulators,lookingtogetlegislationtooverseethesystem."
--CNBConDonaldNorman,Co-founderofBitcoinConsultancyThesearethebigthreebitcoinregulatoryproponentswithinthebitcoincommunity.Therearecertainlymanymoreoutsideofthecommunity.Now,letmeseeifIcansummarizetheirrationalebecausethesequotesarenotisolatedincidentsandtheyarenottakenoutofcontext.Ibelievethattherationaleistwofold:
(1)
areactiontotheanonymousonlinedrugcompany
10f6
11125/20116:12
PM
TheMonetaryFuture:AirGuitarsandBitcoinRegulationhttp://themonetaryfuture.blogspot.com/20
III
11/air-guitars-and-bitcoin-...SilkRoadtaintingthefledglingcurrency;and
(2)
abeliefthatbitcoinexchangesgivenaregulatoryblessing
will
beinapositionofstrengthforcustomersexchanginginandoutofnationalcurrencies.Bothoftheserationalesaremisguided,especiallywhenbootstrappingadecentralizedP2Pcryptocurrency.Bitcoinwasdesignedfromtheoutsettoroutearoundcentralized,authoritarianinterference.Bitcoin'sdesigner(s)anticipatedregulatoryterminationandassetconfiscationbecausebitcoinitselfisadirectchallengetotheprivilegedmoneymonopolyofthesovereign.Theissueisnotwhetherbitcoinasadigitalcurrencyembodieslibertarianpoliticalandeconomicbeliefs-itwassimplydesignedtosurvive.However,itissupremelynaiveanddafttothinkthatagovernmentwillnotsoonerectlawsandregulationstopreventanonymousanduntraceabletransactions.Additionally,governmenttendstotaxthatwhichitregulatesandasanctionedbitcoinwillsoonbetransformedintoan'approved'anduselessdigitalcurrency.Bitcoinexchangesareconstantlyunderattackinvariouspartsaroundtheglobeandevenwithpartially-regulatedexchanges,lawscanalwaysbemodifiedtoaccomplishtheaimsoftheState.Thesolutionistocreatedecentralizedexchangesandtopromotebusinessmodelsandclosed-loopparadigmsthatmakefittingintothecurrentinstitutionalstructureirrelevant.
It
isaperpetuallylosingbattletoseekminorlegalvictorieswithintheconfinesofanarbitrary,subjectivecourtsystem.Indifferentiatingbetweenthefearofpunishingcodersandthefearofpunishingtheconsumersandmerchantsthatopenlychoosetotransactinbitcoin,JamesWestlocksummeditupnicelyinhiscommenttothe"BitcoinandAgorism"article:"EveryonehereunderstandsthataBitcoinexchangeisnothingtodowithBitcoinclientsandthesourcecodethatiscompiledintothem.TheimbecileswhorunexchangesinpolicestatesliketheUSAwillbescrupulouslyavoidedbyanyonewithabraincell,andthosewhosetupexchangesinfree(er)countries
will
reapthebenefit.AnyonedevelopingaBitcoinclientcannotbechargedwithconspiracywithregardtotheusesthattheclientisputto,inthiscaseexchanges.Theclientisneutral,justasbrowsersareneutral.Youcanuseabrowsertocommitacrime,butculpabilityforthatcriminalactcannotbepassedtothepeoplewhocodethebrowser(Mozilla,Google,Apple)."Tobesure,DavidNormanandAmirTaakihavemanymorepro-regulationreferencesandcitationsavailableattheirwebsite.Forinstance,TaakigivesaradiointerviewwiththeKatherineAlbrechtShowintheU.S.Then,reportinginthe
Independent,
StephenFoleyquotesDavidNormanonthehackersthatbroughtdownthelargestbitcoinexchange:"IntheUK,supportersofBitcoinmadeanurgentappealtotheFinancialServicesAuthoritytoregulatethelargestLondon-basedexchange,soastoreassurepeoplethatusingBitcoinissafe.'Unregulatedbusinessesdon'tusualcryoutforregulation,'saidDonaldNorman,co-founderoftheexchangeBritcoin.'ButbecauseweareunusuaLandbecausewearedealingwithneonle'smonev,and
20f6
11125/20116:12
PM
TheMonetaryFuture:AirGuitarsandBitcoinRegulationhttp://themonetaryfuture.blogspot.com/20
III
11/air-guitars-and-bitcoin-...becauseofallthescarystoriesaroundBitcoin,wewouldlikenothingmorethantohaveagovernmentauthoritylookingintoouraccounts-especiallynow."InordertogainlegitimacyforadecentralizedP2Pcryptocurrencythatcomeswithuser-definedanonymityanduser-definedtraceability,theStatistapologistshavegoneoutoftheirwaytoseekclearandconciseguidelinesfromthegovernmentonwhatwillandwillnotbepermittedwithrespecttobitcoinactivity.Theymaysoongettheirwish.
UKFinancial
Services
Authoritu
on
BitcoinRegulation
AresponsepurportingtobefromtheFSAappearedrecentlyintheBitcoinForum.Inreadingthewell-referencedtext,itappearsobviousthatbitcoinitselfcannotberegulatedasmoneybutthatexchangerswouldfallundertheguidelinesofFSAregulationbecausetheyaredeposittakersandholdingbalancesinnationalmoneybeforeandafterthebitcoinexchangetakesplace.Abitcoinservicethatsimplyprovidedamatchingservice,suchasbitcoin-otc,wherebuyersandsellerssettledontheirownwouldnotthereforefallundertheregulation.ThisisimportantbecauseofvariousclaimscirculatingthatthereisacoordinatedeffortonthepartofEU-basedfinancialinstitutionstofreezeorimpedebankaccountsthatareactingasagentsforbitcoinexchangesorbankaccountsofbitcoinexchangesthemselves.InAugust2011,theFrenchbankCICfrozeMtGoxclientfundsandclosedthebankaccountpavingthewayforacourtcaseandfinaldecisiononOctober18th,2011.ThenonOctober21st,2011,MtGoxreleasedthisstatement:"WhileBitcoinataEuropeanlevelissofarnotdirectlyimpactedbythisdecision,theBankdeFrance(France'scentralbank)hasconfirmedthatbecauseofEuropeanbankingrules,
monetary
transfers(depositsandwithdrawals)throughasingleentityaresubjecttofinancialregulationandthereforecanonlybeperformedbylicensedfinancialinstitutionssuchasbanksorPaymentServicecompanies(theEuropeanEquivalenttoaMoneyServiceBusiness).ThisdecisionhasforcedustofindotherpaymentprocessingpartnerswithinEuropethat
will
allowustoquicklyresumeallEURtransactionsforourEuropeancustomerssoon."Seekinglegalopinionsandregulatoryclarificationwillonlyresultinmoredisappointments.Therefore,inordertoobtaintherulingthatthebitcoinregulationproponentsseek,bitcoinexchangesandbitcoinmerchantapplicationswillhavetobeadaptedtosupporttheenforcementof
AML
rulesregardingmoneyservicebusinessesandidentityverificationforprepaidaccessproducts,suchastherecentFinCENregulatorychangesfromtheUnitedStates.Inthefuture,wearelikelytoseeregulationsandenforcementagainstthebitcoinexchangeinfrastructureaswellasrestrictionsonbitcointransactionsatthelargeonlineandofflinemerchantssubjecttoestablishmenttransactionalreportingrequirements.Bothenforcementavenues
will
be
30f6
11125/20116:12
PM
