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!
So, since they've decided that bitcoin is property, not a legitimate currency, every time one uses it as a consumer, every cup of coffee, restaurant meal, book, piece of computer hardware, you buy with it, you have to pay capital gains tax. In other words, bitcoin has been elevated to the prestigious position of gold: scary competitor to whom we will give no quarter.
That's about the shape of things. If you needed any further evidence that the U.S government, and national governments, in general, hold free markets in contempt, there you go. Really though if you're surprised by these developments, you haven't been paying attention.
On the positive side, this development certainly makes things more interesting for bitcoin. I've been hearing around calls by bitcoin promoters for campaigns to lobby for IRS policy change. Really? That seems awfully fanciful; a kind of willful ignorance of the necessity of national governments to eliminate currency competitors.
For me, the writing has always been on the wall for some time (and I've been perplexed by those who can't or won't read it). Bitcoin can only thrive as a competitor to fiat currencies. It can only provide such competition, however, outside the good graces of the nation states.
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're referring to peaceful people voluntarily exchanging goods and services among themselves, while causing no trespass upon the life or liberty of anyone else...if that's what you mean by "criminals." Yes, I guess so.
But of course as anyone knows, who bothers to give the matter even a moment's thought, among the real criminals, the organized gangs of human traffickers, extortionists and murderers, the currency of choice has always been the U.S. dollar. Oh, and thanks to this policy, the savings of those real criminals just increased in value compared to bitcoin. Typical stand-up job you boys down at the IRS!
Call me cynical, but as far as I'm concerned, this is about criminalizing people who just want to choose their own currency of exchange. But we can't have that, can we? That would be just too scary for the fraudsters and bureaucrats who run our government-banking complex.
So, since they've decided that bitcoin is property, not a legitimate currency, every time one uses it as a consumer, every cup of coffee, restaurant meal, book, piece of computer hardware, you buy with it, you have to pay capital gains tax. In other words, bitcoin has been elevated to the prestigious position of gold: scary competitor to whom we will give no quarter.
That's about the shape of things. If you needed any further evidence that the U.S government, and national governments, in general, hold free markets in contempt, there you go. Really though if you're surprised by these developments, you haven't been paying attention.
On the positive side, this development certainly makes things more interesting for bitcoin. I've been hearing around calls by bitcoin promoters for campaigns to lobby for IRS policy change. Really? That seems awfully fanciful; a kind of willful ignorance of the necessity of national governments to eliminate currency competitors.
For me, the writing has always been on the wall for some time (and I've been perplexed by those who can't or won't read it). Bitcoin can only thrive as a competitor to fiat currencies. It can only provide such competition, however, outside the good graces of the nation states.
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're referring to peaceful people voluntarily exchanging goods and services among themselves, while causing no trespass upon the life or liberty of anyone else...if that's what you mean by "criminals." Yes, I guess so.
But of course as anyone knows, who bothers to give the matter even a moment's thought, among the real criminals, the organized gangs of human traffickers, extortionists and murderers, the currency of choice has always been the U.S. dollar. Oh, and thanks to this policy, the savings of those real criminals just increased in value compared to bitcoin. Typical stand-up job you boys down at the IRS!
Call me cynical, but as far as I'm concerned, this is about criminalizing people who just want to choose their own currency of exchange. But we can't have that, can we? That would be just too scary for the fraudsters and bureaucrats who run our government-banking complex.
About the Author:
Wallace Eddington is a major writer on financial and monetary news and a regular contributor to the Bitcoin Profit Calculator site, where he's written about the Mt. Gox fiasco and other hot bitcoin issues. Check out his hard hitting piece on inflation at the Fiat Currency Review.