IRS & Bitcoin

[dannno]

Similarly, I'm not sure why you're so hell bent on making ridiculous and impassioned defenses of bitcoin either. It's proven to not be secure, not anonymous and is fully trackable (apparently unless you buy it with cash at a Starbucks from a random person and then never interact with it again...sounds like money to me lol). Never mind that it is old tech as far as blockchain goes and has been well documented as being fraudulently valued via exchange wash trading and Tether games. Then there's the obvious cashless initiative and other signs I've detailed that it's completely a creation of the usual suspects. Seems like none of that matters to you. Just buy bitcoin! You'll get a lambo!

Everything you just said is wrong.

Bitcoin is secure, bitcoin has never been hacked. Exchanges have been hacked, but bitcoin has not been hacked.

There are anonymous cryptos, I listed several.

Bitcoin is anonymous as long as you don't tie your name to the exchange or the transaction. If you do, then once the crypto leaves that exchange or wallet, it's anybody's guess who owns that new wallet. So it isn't really that trackable.. but if you're concerned, there are plenty of anonymous cryptos that are not trackable.

You don't always need or want a totally anonymous crypto, although I am glad they exist.

I am pro-crypto. Right now bitcoin is the dominant crypto, but I am for competition.

At least two decentralized, open source exchanges exist yet you keep harping on buying from people at starbucks. You can buy crypto from people who own crypto anonymously, that is the bottom line. Right now people use websites to find others who are selling, but eventually if the use is widespread it will be easier to find people who own it without meeting random people. I don't know why you keep making ludicrous arguments.

[brushfire]

You have not been told that it is completely anonymous. There are cyrpto currencies that are completely anonymous, bitcoin is not one of them. However, if you send bitcoin from one address to another, and then to another, there is no indication of who owns these other wallets. Your name isn't attached to the wallets, just the exchanges. They can presume things from the transfer, but that's about as far as it goes.

There were man occasions on this very forum where people initially claimed that BTC was an anonymous currency - I'd argued against that stating that it was just a matter of time before folks were hunted down by the government. Its one of the reasons I'd never purchased BTC early on.

True on the point that your name is not attached, but my argument is that it doesn't have to be explicitly tied to your name or SSN.

For every transaction, there are 2 sides. The currency side (bitcoin) and the goods/services rendered side. For the individual to be exposed, one need only catch them on the goods/services side of the transaction. From there, the transaction identifiers/coins/wallets/etc can all be traced back through the ledger chain.

BTC is about as anonymous as one's dna or fingerprint might be. Make sure to keep every surface clean, burn all of your trash, etc - cause anyone tracking your dna/fingerprint can forensically link you to anything you've ever touched, once they have you associated with the print.

Now, add the limitless compute resources of the government, and you have a means of exposing and controlling everyone. The same might be done with a serial number on each dollar, but that's still a physical currency. BTC enables government to leverage compute to do all the work for them. Sounds crazy, but I'm certain its happening.

[dannno]

There were man occasions on this very forum where people initially claimed that BTC was an anonymous currency - I'd argued against that stating that it was just a matter of time before folks were hunted down by the government. Its one of the reasons I'd never purchased BTC early on.

They were correct. BTC in and of itself is anonymous. There is nothing in the ledger that has your name on it.

However, the transactions can be tied to identities by third parties. But if you send BTC to an address outside the exchange, how does the government know whether you sent the money to your own personal wallet, or to someone else? They can try and figure it out, but the only thing the ledger tells them is that it went to a new wallet and how much.

True on the point that your name is not attached, but my argument is that it doesn't have to be explicitly tied to your name or SSN.

For every transaction, there are 2 sides. The currency side (bitcoin) and the goods/services rendered side. For the individual to be exposed, one need only catch them on the goods/services side of the transaction. From there, the transaction identifiers/coins/wallets/etc can all be traced back through the ledger chain.

BTC is about as anonymous as one's dna or fingerprint might be. Make sure to keep every surface clean, burn all of your trash, etc - cause anyone tracking your dna/fingerprint can forensically link you to anything you've ever touched, once they have you associated with the print.

Now, add the limitless compute resources of the government, and you have a means of exposing and controlling everyone. The same might be done with a serial number on each dollar, but that's still a physical currency. BTC enables government to leverage compute to do all the work for them. Sounds crazy, but I'm certain its happening.

Ya, there are ways to trace the btc through the chain, but that is a lot of effort and a lot of people giving up a lot of information that really isn't very legal. The government typically needs a warrant or something to get this info.

The good news is there are anonymous cryptos, and the very existence of those anonymous cryptos makes it a poor decision for governments to go after bitcoin like that. Because people can just switch to an anonymous one instead.. then they won't be able to do jack. At least with bitcoin, if they allow people to use it, then when legitimate abuses occur they can more easily track what happened.

You definitely have some valid points, but they just aren't good enough to say, give up, or not get involved. There is nothing better, and it is much better than nothing.

[Mordan]

That list at the link is basically just services that facilitate the buying of cryptos outside of actual exchanges. Wall of Coins appears to come close but still isn't anonymous since it requires at least one piece of identifying information. As I said, there are no actual exchanges that allow fully anonymous account creation with standard crypto market operations. eta: the BISQ one also comes close but is a P2P exchange service instead of a front-end exchange. Better than nothing I guess if someone wants to buy into the next banker ponzi.

BISQ works. Its fully decentralized. BISQ mode is currently the best way to do it. You don't have to meet in person. You just need a banking account number to make a trade and some bitcoin to put up as collateral to prevent you from cheating.

He asked. I answered.

BISQ is complicated. But here you have true power of the people.

[Mordan]

There were man occasions on this very forum where people initially claimed that BTC was an anonymous currency - I'd argued against that stating that it was just a matter of time before folks were hunted down by the government. Its one of the reasons I'd never purchased BTC early on.

You didn't and still don't understand Bitcoin.

People who understands Bitcoin. buy once a little. and then buy more.

You listened to the wrong people. Bitcoin is pseudonymous. Nobody argued otherwise.
OK. I advice you so to research Monero and atomic swaps. What informed conclusions can you make out of the information?

[devil21]

BISQ works. Its fully decentralized. BISQ mode is currently the best way to do it. You don't have to meet in person. You just need a banking account number to make a trade and some bitcoin to put up as collateral to prevent you from cheating.

He asked. I answered.

BISQ is complicated. But here you have true power of the people.

Do you have to provide the bank account info to BISQ?

[Mordan]

Do you have to provide the bank account info to BISQ?

BISQ provides the software to match buyers and sellers with a modicum of security via a collateral and a BISQ controller to deal with disputes.

You do enter your bank account in the BISQ interface.. but its stored locally. It is not sent to a centralized server. It is used to communicate with sellers and buyers who of course need that information when buying Bitcoin with fiat.

Don't take my word for it. BISQ is open source. Reading Java is simple. You can then build from source. No backdoors.

[Krugminator2]

Mo6st of what the IRS does is fishing expeditions. By sending out notices they seek to create "controversy" (legal term) that the recipient acknowledges, thus entering a contractual dispute that can be litigated. Silence is also considered legal acceptance/consent so not replying is a bad move as well. The best way to respond to an IRS notice is mail them back saying you don't wish to engage in controversy and do not agree to enter into a contractual dispute. It's your engagement with the agency (aka contracting) that triggers their ability to do all the nasty stuff to you.

on topic: why did anyone think the exchanges needed every piece of ID info in order to open an account? cryptos are the bankers next monetary control system and the exchanges are the front end "banks" for it.

The fishing expedition part is pretty accurate. Without going into too much detail I got a notice saying I owed on some horse$#@! technicality. I protested and just found they ruled in my favor. But it is pretty intimidating. And it took hours of work dealing with different people and months. I can say some people at the IRS are friendly and some get off on their power even when they are clearly wrong.

As far as this thread, just pay your taxes. The rare times I trade bitcoin, I use the futures so I don't have much of a choice. But not paying taxes in bitcoin opens the door for an anal probe.

[kfarnan]

MHO. IRS is an incompetent hell. Don't engage at all. Just stay out of their system..