When will Secretary Yellen issue the simple regulatory edict that will keep Bitcoin alive but limping?
Her thumb is on the bitcoin-dollar conversion spot
It will probably be on a Friday afternoon, maybe not next Friday because Bitcoin at one trillion dollar is still not big enough. But soon more and more bitcoin-paid income will escape the IRS, more and more merchants will accept Bitcoin, so there will be no need to convert to dollars, more and more hidden bitcoin payments — bribes — will corrupt the entire government operation; more and more ransomware and other crimes will paralyze the economy. And when this happens the IRS will declare: Bitcoin is fine, but to be accounted for tax purposes, the human identity of the account owner has to be revealed. The Securities and Exchange Commission will follow suit: publicly traded companies must expose the owner of the account the merchants either paid to, or got paid from. And typically, the government will argue that this does not harm people’s privacy. Bitcoin account holders will be asked to walk into the next post office, passport in hand, and register themselves as owners of their accounts. The government will publish a public ledger of accounts that were so registered, and these accounts will be free to trade with Bitcoin to their heart’s delight. The trading public will remain clueless as to who the registered traders are, only the government will know. Just like with taxes, only the IRS knows your return, none other. The argument would be: bitcoin is as private as your tax return.
In fact every Bitcoin that Tesla, Home Depot, IBM or others would accept, will have to have its full history clean — from the miner on.
This accounting regulation does not require an Act of Congress, no Presidential Order, it’s strictly a bureaucratic implement. What it will do, is to separate the innocent Bitcoin traders from the criminal element. And since the criminal element is the driver of the currency, its future is dim.
No, the government does not need to “put a protocol in jail”; the government does not need to hunt down for alternative global networks, as some suggested, the government does not even need to crack the elliptic curve mathematics. The government simply dictates what is legitimate and what is not. And that is why we keep working on one of the least known digital currencies around: BitMint. It offers the advantages of Bitcoin, it offers common privacy, but it is unwelcoming to criminals, fraudsters, and tax cheaters.