Agent provacateurs may be used to provoke a tax crackdown

What is an agent provocateur?

An agent provocateur (French for "inciting agent") is a person who commits, or who acts to entice another person to commit an illegal or rash act or falsely implicate them in partaking in an illegal act. An agent provocateur may be acting out of their own sense of duty or may be employed by the police or other entity to discredit or harm another group (such as a peaceful protest or demonstration) by provoking them to commit a crime, thereby undermining the protest or demonstration as a whole.

Agent provocateurs may try to entice innocent people into committing illegal yet dumb acts (like hacking the police), in order to provoke a reaction from the authorities and justify a crack down. In a sense, if people in crypto space start being enticed into taking on increasingly bold yet stupid illegal activities then it justifies the agenda of politicians who don't like cryptography in general, or who don't want cryptocurrencies to have wide spread uses.

An agent provocateur may be a police officer or a secret agent of police who encourages suspects to carry out a crime under conditions where evidence can be obtained; or who suggests the commission of a crime to another, in hopes they will go along with the suggestion and be convicted of the crime.

Most people have to realize that the blockchain is transparent. Activities done in Bitcoin are very traceable and the blockchain can be analyzed indefinitely which means there is no limit to the amount of time analysts have to detect the activities of suspects. The easiest way not to be convicted of a crime is to follow the law to the best of your ability. The easiest way not to be used as a "useful idiot" by politicians trying to crack down on encryption is not to let yourself be baited into abusing encryption because any abuse of encryption can be held up by the media and by politicians as an excuse to ban encryption.

If you believe encryption has positive benefits for society then it is up to you to spend most of your time focusing on showing the positive benefits. Telling people there are positive benefits isn't as powerful as showing these benefits. Just as with the blockchain it was not enough to simply tell people about Bitcoin but people had to be shown exactly what a blockchain does for them. Over time agendas can change and people can see that the technologies like blockchain and cryptography have pro-social use cases but I think we should expect to see many abuses going forward and expect to see politicians pounce on these examples of abuses in coordinated fashion just as we see with the threats to ban encryption.

But what if the terrorists use encryption and cryptocurrencies?

The case to ban encryption and cryptocurrencies will be that terrorists use these technologies. Politicians and people with anti cryptography agendas will not focus on the lives that were changed or improved by the technology, or the people who have been saved by the technology, but they will focus on the lives lost and people killed by the technology. Just as with the self driving car, if there is any accident caused by AI then politicians will pounce on it and use it as an excuse to ban self driving cars even if the overall statistics show that the AI is producing far fewer accidents per year. The same will be the case with cryptocurrency, with Steemit, with encryption, even if most encryption is useful to improve security and protect lives, there will be people who wait until an accident happens and then pounce on the opportunity to push for a ban.

Terrorists may be using encryption and cryptocurrency as they'll probably use any technology available. The rest of us would like at least as much access to technology (or greater) than the terrorists and because encryption and cryptocurrency cannot be uninvented we now have only the option to figure out how to bring it to the masses, to the mainstream, so that it can be used to produce security rather than insecurity.

What about a tax crackdown provoked by agent provocateurs?

While many people have legitimate philosophical and moral reasons to scoff at the idea of paying taxes, it's not in my opinion a very smart thing to continue promoting certain memes at least on Steemit. Any time a blog post about taxes appears, we usually see someone post a meme saying "taxation is theft", or "don't pay your taxes", and usually these are anonymous people behind anonymous accounts, or people who live in countries which don't tax these things. The problem is if groups like the IRS really believe that Steemit is nothing more than a tax shelter, then the agent currently trying to crackdown on Coinbase can quickly see a lot of people on Steemit don't intend to pay their taxes and begin focusing on Steemit.

And of course there is disinformation going on telling people they don't really have to pay taxes and nothing will happen to them if they don't. Well, Wesley Snipes found out what happens if we follow that nonsense advice. If there is an agenda to crackdown on cryptocurrency users for taxes then now would be a good time for cryptocurrency users to begin to lawyer up, to hire accountants, to take a defensive posture, in order to protect themselves and the industry. If some of the top developers end up in jail then this slows down progress in the space, so these developers might be better off hiring accountants and paying the taxes.

Whether or not this will avoid a crackdown is anyone's guess but I would say as a community we should not aid in the justification of crackdown by baiting the authorities or challenging the authorities. These opinions are my own, backed by the facts and data I've collected and studied.

References

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1. https://en.wikipedia.org/wiki/Agent_provocateur
2. https://www.newscientist.com/article/2133644-theresa-mays-repeated-calls-to-ban-encryption-still-wont-work/