There's only two possibilities here. Either the IRS is intent on destroying bitcoin or they are so completely incompetence and they presume their capacity to introduce policy in the face of their own complete and utter ignorance of the facts. Nor would it seem that even a modicum of research is necessary for the big pant-loads at the IRS to screw up other people's lives. Well done you clowns!
They have ruled bitcoin is not a currency, but only property. The upshot of this ruling is that now every time I use my bitcoin, to purchase a meal, a beer or a new keyboard, I have to pay capital gains tax. So, lucky bitcoin, it's made it to the heady heights of gold: stigmatized as a currency competitor too scary to be allowed to compete on a level playing field with the pathetic U.S. dollar.
That's about the shape of things. If you have illusions about why nation states suppress and make a mockery of free markets through their coercive enforcement of their fiat currencies, surely these facts should disabuse you. In that context, really, nothing less should have been expected from the IRS.
What does this mean for bitcoin? Well, the whole situation just got much more interesting. I'm amused by those in the bitcoin community I hear talking up the need to lobby the IRS for a policy change. Such an attitude strikes me as peculiarly blind to the realities of why nation states are so determined to exclude competitors with their fiat currency.
It seems to me that we're back to what has always been the inescapable fact. The only way for bitcoin to thrive is as a competitor to fiat currency. And the only way it can function as such a competitor is outside the legitimized sphere of the state.
Is the trite mass media condemnation of bitcoin as currency of criminals destined to be come true? Depends what you mean by criminals.
If by "criminals" you mean free people, voluntarily engaging in mutual exchange, trespassing upon the life or liberty of no one else. If that's your definition of "criminal": well, maybe.
Of course what such accusations about bitcoin almost always ignore is that for real criminals, who assault, torture, murder, rape and steal from others, the U.S. dollar is the currency of choice. So the real criminals' savings in U.S. dollars just went up in value compared to bitcoin. Well done IRS. You're so smart.
No, this is all just about criminalizing people who want to choose their own currency. I would say "shame on you IRS", but you can't shame conscienceless thugs, can you? And it's with just such people that we are dealing.
They have ruled bitcoin is not a currency, but only property. The upshot of this ruling is that now every time I use my bitcoin, to purchase a meal, a beer or a new keyboard, I have to pay capital gains tax. So, lucky bitcoin, it's made it to the heady heights of gold: stigmatized as a currency competitor too scary to be allowed to compete on a level playing field with the pathetic U.S. dollar.
That's about the shape of things. If you have illusions about why nation states suppress and make a mockery of free markets through their coercive enforcement of their fiat currencies, surely these facts should disabuse you. In that context, really, nothing less should have been expected from the IRS.
What does this mean for bitcoin? Well, the whole situation just got much more interesting. I'm amused by those in the bitcoin community I hear talking up the need to lobby the IRS for a policy change. Such an attitude strikes me as peculiarly blind to the realities of why nation states are so determined to exclude competitors with their fiat currency.
It seems to me that we're back to what has always been the inescapable fact. The only way for bitcoin to thrive is as a competitor to fiat currency. And the only way it can function as such a competitor is outside the legitimized sphere of the state.
Is the trite mass media condemnation of bitcoin as currency of criminals destined to be come true? Depends what you mean by criminals.
If by "criminals" you mean free people, voluntarily engaging in mutual exchange, trespassing upon the life or liberty of no one else. If that's your definition of "criminal": well, maybe.
Of course what such accusations about bitcoin almost always ignore is that for real criminals, who assault, torture, murder, rape and steal from others, the U.S. dollar is the currency of choice. So the real criminals' savings in U.S. dollars just went up in value compared to bitcoin. Well done IRS. You're so smart.
No, this is all just about criminalizing people who want to choose their own currency. I would say "shame on you IRS", but you can't shame conscienceless thugs, can you? And it's with just such people that we are dealing.
About the Author:
Wallace Eddington is a major commentator on financial and monetary events and a regular contributor to the Bitcoin Profit Calculator site, where he's gotten the scoop on the Mt. Gox fiasco and other hot bitcoin issues. Check out his hard hitting piece on inflation at the Fiat Currency Review.
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