Anonymous coins will end up as black money that will cause someone accepting the money to be imprisoned for up to 20 years (as of current USA legislation):
In theory, electronic money should provide as easy a method of transferring value without revealing identity as untracked banknotes, especially wire transfers involving anonymity-protecting numbered bank accounts. In practice, however, the record-keeping capabilities of Internet service providers and other network resource maintainers tend to frustrate that intention. While some cryptocurrencies[24] under recent development have aimed to provide for more possibilities of transaction anonymity for various reasons, the degree to which they succeedand, in consequence, the degree to which they offer benefits for money laundering effortsis controversial.
Note apparently as the law stands now, the person accepting the money has to have some knowledge or suspicion that the money might be derived from criminal activities in order to be culpable under the current law in the USA. Also, I have not been able to find the same personal level of criminal culpability in the EU laws yet in my searches. Most definitely not in Finland:
http://www.finlex.fi/en/laki/kaannokset/2008/en20080503.pdfBy taxing crypto-rubles at the capital gains rate for those that cannot provide a paper-trail of ownership, Russia and Putin are incentivizing the development of low-cost crypto-payment systems to exchange rubles for goods only in cryptocurrencies that also track ownership, like Ethereum and others that have transparent blockchain histories.
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The crypto-ruble provides the means by which to convert, transaction-cost-free, back into the national fiat currency to pay bills, taxes and the like. This is in direct opposition to how the U.S., for example, treats cryptocurrencies.
The 2014 I.R.S. rule that classified Bitcoin as property means that every Bitcoin transaction, no matter how minor, creates a potential capital gains event. It means that buying a cup of coffee at Starbucks in Bitcoin is taxable for both the person buying the coffee (capital gains on the sale) and Starbucks when they go to sell those Bitcoins, buy dollars and pay salaries, order supplies, etc.
Its why the capital that has moved into cryptocurrencies isnt moving back out. Its why the ICO market has exploded. Billions in profits actively looking for new investment opportunities without paying taxes.
Its also the main reason why Amazon, for example, doesnt take Bitcoin. Who wants that hassle?
Can you imagine Amazons Schedule D if it accepted Bitcoin?
The crypto-rubles structure dispenses with that for those that can prove ownership via the blockchain. Bitcoin allows for transaction transparency, so does Ethereum, Litecoin and many others.
The prospect of such a One-World-Currency that everyone would use on a daily basis is simply
impossible on a voluntary basis and could only be accomplished by force of
arms if that since not even Rome achieved that position. In contrast,
governments are collapsing from Marxism with its core principle that they have
the right, power, and wisdom to manipulate the economy to eliminate recessions
and control society. Such measures become authoritarian, and freedom
vanishes.
Today, this move toward a One-World-Currency is driven by taxation. The
government never considers they are the problem. Instead, they see the solution
as always had they just a tiny bit more power they would eliminate recession.
Governments have used terrorism as the excuse, and Money Laundering is now
redefined as hiding money from the government even if taxes. Today it is all
about sustaining power. We have this drive toward electronic money to control
all wealth. Thus, we will explore the complexity of this evolutionary process and
expose trends that are in motion that dictates the future.
Tie the above quote into the following:
I do not think it is possible to make distribution permissionless. Proof-of-work is competitive but the problem is that most people cant compete thus the onboarding is very narrow and the token stays mired as a speculation and HODLER coin.
What I hope is that [
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A few thoughts:
The inability to move freely out of cryptos without paying taxes could be argued as beneficial to crytpos and the speculative network effect I think. The case can be made that it's actually giving this industry a huge boost. Trace Mayer talks about the 7 network effect he's identified and speculation being a primary one. If people are unwilling to hold them, then they are effectively not valuing them, thus nobody will accept them for service, etc., etc. Capital gains tax and hopeful speculation about how they will be treated (taxed) in the future incentivizes holding, which boosts value, which boosts acceptance, etc.
This instance with Russia could be the direction that others follow or maybe not. Russia providing an outlet in a legal way (requiring paper trail) does seem smart. The article also says:
Now, cryptos can exist side-by-side with rubles without worrying about the threat of double taxation, unless you earned your money in the murk, at which point Russia wants 13% capital gains.
13% punishent for not showing paper trail is also not too bad. I really think a lot of people are going to have a tough time proving a paper trail at this point, although I guess it depends on what they require. For instance, a friend of mine was asked by an exchange recently to provide proof of when their BTC was purchased (5 years ago!). Many were bought with cash, and many were bought on an exchange what is now shutdown and there are no records. Is that money permanently trapped in the eco-system? Well I suppose it could be exchanged for crypto-rubles for 13% fee. So again, smart move by Russia maybe. I also think personally that private deals might become more common if this paper trail hassle become too great.
As far as anon-coins being illegal, can you elaborate on why you view this differently than Cryptos in general. What I mean is that Armstrong argues against BTC saying the elites simply won't allow it. You're rebuttal was that they can't shutdown Cryptos without shutting down the Internet (at least I hope I'm not misrepresenting correct me if i'm wrong). However, on the other hand you seem to be saying that Anon-coins will be banned and users jailed and consequently they won't be a viable solution as we'd all hoped.
My thought is that this won't be a closed case for a while. I'd speculate that in fact Anon-coins will be huge. We need to remember that probably the vast majority of "dirty" money out there is likely that which governments and and politicians have had their hands on. Of course what they do is exempt collectively, but many elites individually hold tons of money in offshore accounts and launder it in various ways. I highly doubt that the elites will accept the same transparency that they want to force on the under class. So for that reason they actually need anon-coins and that will be the future of money laundering and their new off-shore bank account. Currently it's a bit of hassle to set up offshore accounts, obtain 2nd passports, etc., but with anon-coins, even the average joe will be able to hide money very cheaply and effectively, so again, I see Cryptos being a huge challenge for the elites who want to say one thing and practice another.