Crypto for the Average: The upcoming Bitcoin war

No, this post isn't about BTC vs Bitcoin Cash, Gold, or diamond. We're talking about the upcoming legislative war. Yes, many of you have read or watched video post concerning Senate Bill 1421. However; we haven't seen anyone delve into this with great detail.

https://btcmanager.com/us-senate-bill-s-1241-criminalize-concealed-ownership-bitcoin/

I recently discussed this with AxiomParadox, whom had some great insight to add to my initial inquiries about a post I read on BTCmanager, and for which I'd like to thank and share. Please read, think about it, add comments and definitely share.

The proposal (taken from BTCmanager)

****'''Bill S.1241 would amend the definition of ‘financial institution,’ in Section 5312(a) of title 31, United States Code, to include “an issuer, redeemer, or cashier of prepaid access devices, digital currency, or any digital exchanger or tumbler of digital currency.” Currently, the definition of ‘financial institution’ includes banks, trust companies, credit unions, currency exchanges, etc.'''

Lets break this down:

1. The US govt. is in a tricky position. By proposing this Bill or facsimile thereof, would further validate Bitcoin (and alt coins). It shows, at the very least, Bitcoin is being taken seriously. Many of us would say 'a threat'.

2. Can such a Bill be passed? Bitcoin, for tax purposes (in USA) is considered an asset. To make a law that citizens must declare 'digital assets' would be in violation of the Constitution, allowing the US govt. to be HIGHLY INTRUSIVE into the affairs......the households of American citizens. Where are the lawyers on this one?!
   2a) Section 5312(a) as it is currently written, deals with currency. To amend the Bill to include 'digital exchanger or tumbler of digital currency' would actually validate Bitcoin as a currency. Yes?/No? And, how can we be taxed on a currency? Seriously. There are laws already in place that allow US citizens to buy and sell precious metals without taxation (under 10k). Essentially the US govt. doesn't want another competing currency against the US dollar, and the IRS wants to tax those whom sell BTC for a profit. Their trying to have it both ways, as they (US govt) see fit.

****"""Tone Vayes’ summation*: “It’s bad…I think it’s gonna end in a very confrontational way between Bitcoin—even Bitcoin holders and users—and the US Government.”

1. We concur, but T. Vayes is only scratching the surface. What defines a digital currency? If this applies to BTC then does it not apply to various gaming currencies? What about Amazon points? Itunes? The list would be long, wouldn't it? Will you eventually have to claim all of your kid’s gems in the new mobile game?

2. Do you think large-scale companies such as Amazon or Electronic Arts will allow such a Bill to pass without a thorough fight? You'd hope not, right?!

3. What will be the cut-off point (US $) where a citizen would have to declare such an asset? I'd suspect that the initial cut-off would be set at 10k. And then, eventually lowered, and lowered again.

4. And pray/tell, how is the US government going to keep track of where millions of BTC holders spend their BTC? They can't. At best, for now, they can watch exchanges such as Coinbase and Gemini. (comment below regarding BTC transaction avenues that will easy/difficult to trace).

So, as you can see, we're just scratching the surface here with regard to all of the legal issues. This will be a monumental task for the US government with regard to implementing, yet alone drafting.

MOST IMPORTANTLY--Lets not let the mainstream media or other crypto-currency naysayers let this turn into FUD. The way we see it, the US government is the one fighting an uphill battle not Bitcoin. PLEASE SHARE THIS.