Another great episode of YATV! Max summarized my sentiments on CBDCs, the only way to preserve your freedom is to start using #BTC now, because once the CBDCs arrive? All exits will be shut and the op...
Sorry I haven't seen the episode. But it is quite easy for regulators to close bitcoin as an exit for the following reasons:
1. Censoring bitcoin transactions through compliant miningpools.
2. Taxing bitcoin out of existence.
Ad 1. is a well known problem I think. So decentralized template building in miningpools is a great development.
Ad 2. No easy solution for this one. Even if you build a total parallel circular bitcoin economy, how are you going to prevent the taxman from knocking on your door because you bought a cup of coffee with bitcoin? Taxman says: I want x % of tax on that payment. How high does the taxman needs to set x for you to stop using bitcoin (10%, 50% or maybe 95%)?
So the effects of fiat money creation (loss of purchasing power) can be transferred through taxes on to bitcoin by introducing for example capital gains tax. Bitcoin becomes more valuable in dollar terms because of fiat money printing. You thought I am protected,, because I have scarce bitcoins. Then you make a payment and you realize a profit (in dollar terms) and need to pay capital gains tax on your purchase or even worse you do not make a payment and still pay capital gains tax on unrealized gains. Don't believe me? Look at the developments in the Netherlands and the introduction of capital gains tax on unrealized gains.
Unless taxman doesn't know you made a payment or have bitcoin at all. For that you need to have real fungibility in bitcoin. Which bitcoin doesn't have. So you need to hide something on a transparent ledger which only the most technical people within the bitcoin community can achieve with great technical skills, knowledge and discipline. No discipline but great technological skills and knowledge the taxman is still knocking on your door.
1. Censoring bitcoin transactions through compliant miningpools.
2. Taxing bitcoin out of existence.
Ad 1. is a well known problem I think. So decentralized template building in miningpools is a great development.
Ad 2. No easy solution for this one. Even if you build a total parallel circular bitcoin economy, how are you going to prevent the taxman from knocking on your door because you bought a cup of coffee with bitcoin? Taxman says: I want x % of tax on that payment. How high does the taxman needs to set x for you to stop using bitcoin (10%, 50% or maybe 95%)?
So the effects of fiat money creation (loss of purchasing power) can be transferred through taxes on to bitcoin by introducing for example capital gains tax. Bitcoin becomes more valuable in dollar terms because of fiat money printing. You thought I am protected,, because I have scarce bitcoins. Then you make a payment and you realize a profit (in dollar terms) and need to pay capital gains tax on your purchase or even worse you do not make a payment and still pay capital gains tax on unrealized gains. Don't believe me? Look at the developments in the Netherlands and the introduction of capital gains tax on unrealized gains.
Unless taxman doesn't know you made a payment or have bitcoin at all. For that you need to have real fungibility in bitcoin. Which bitcoin doesn't have. So you need to hide something on a transparent ledger which only the most technical people within the bitcoin community can achieve with great technical skills, knowledge and discipline. No discipline but great technological skills and knowledge the taxman is still knocking on your door.
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