Cryptocurrency: Rush to Regulate Foolish re Innovation Privacy and General Hampering

[grarpamp]

protip: "laws" are not necessary to begin "accepting" crypto
as legal tender, just start accepting it for goods and services.


Bitcoin's Political Breakthrough Raises Questions About Its Regulatory Future

https://bitcoinmagazine.com/culture/questions-about-bitcoin-legal-tender-in-us

https://trackbill.com/bill/arizona-senate-bill-1341-legal-tender-specie-bitcoin/2205177/
https://delbene.house.gov/news/documentsingle.aspx?DocumentID=3035
https://bitcoinmagazine.com/markets/bill-introduced-to-make-bitcoin-a-legal-tender-in-arizona
https://constitution.congress.gov/browse/article-1/section-10/
https://twitter.com/2140data
https://twitter.com/Dennis_Porter_

Is it actually possible for individual U.S. states to establish
bitcoin as legal tender currency?

Arizona State Senator Wndry Rogers seems to think so, based on the
submission (SB 1341) she crafted and introduced late last month,
aiming to establish bitcoin as legal tender in the State of Arizona.
Meanwhile Texas Governor Candidate Don Huffines has promised to
recognize bitcoin as legal tender if elected.

But while there is growing interest in state leaders adoption bitcoin
in this way, there might be some obstacles. Namely, the first clause
in article one in section 10 of the U.S. Constitution:

    “No State shall enter into any Treaty, Alliance, or Confederation;
grant Letters of Marque and Reprisal; coin Money; emit Bills of
Credit; make any Thing but gold and silver Coin a Tender in Payment of
Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing
the Obligation of Contracts, or grant any Title of Nobility.”

As of right now, it seems that individual states do not have the
capability, nor the power, to establish a newly acceptable form of
legal tender within the Union of the U.S. So, that’s a bit of a
buzzkill. But it’s clear that we are making significant progress in
the mainstream acceptance of Bitcoin, sparking interest by American
politicians and legislators and spreading like wildfire.

“The key piece here is not whether it will pass or what impact it will
have in Arizona,” explained Dennis Porter, a podcaster focused on the
intersection of Bitcoin and politics. “The true impact of this bill is
the fire that it has ignited. Other states and legislators are now
looking at this as a potential option for their state as a way to
protect themselves from a runaway federal government.”
Game Theory Playing Out

It also means that Bitcoiners as individuals need to become careful,
and much more critical of what our politicians claim and promise. The
game theory that we have been discussing within our circles for years
is playing out, almost precisely as was expected: politicians and
other public figures are realizing the power behind garnering support
from the Bitcoin community. Not just because of the excitement around
price action, but also due to the sheer numbers of the voter base
within the borders of the United States. This voter base reaches
across all party lines, anyone is capable of garnering support, from
all angles.

“States need to begin adopting Bitcoin today so they can begin the
process of protecting themselves from the federal government
unplugging them from the overly-powerful national financial system,”
Porter said. “It’s a win-win plan for any state to adopt Bitcoin. It
gives them more autonomy over their future.”
Changing Perception In D.C.

Another recent development at the intersection of Bitcoin and politics
can be found in a bill introduced to the U.S. Congress by
Representatives Suzan DelBene of Washington and David Schweikert of
Arizona on February 3, 2022.

This particular bill is aimed at introducing a “workable structure for
taxing purchases made with virtual currency,” such as bitcoin. One of
the greatest hindrances to bitcoin adoption by the general public is
its infeasibility as a currency for routine purchases, as it is more
closely treated as a stock or other long-term investment from a tax
perspective in the U.S.

DelBene and Schweikert aimed to alleviate this bottleneck by providing
an exemption from taxes in the use of bitcoin as a currency where
capital gains amounted to less than $200.

“It’s a great way to normalize the whole ‘track your buys under $600
thing,’” said Ant, the pseudonymous author of Bitcoin blockchain data
dashboard Timechain Stats. “Accounting is a nightmare, and hardly
anyone knows their cost basis.”

However, as national politicians attempt to normalize and increasingly
regulate the use of bitcoin, even if that regulation is meant to
increase adoption, they will inevitably challenge the project’s status
as something parallel to and outside of the national system.

“Most important: Bills like this will end up doxxing a lot of
bitcoiners, both directly and indirectly,” Ant warned.

While a bill like DelBene and Schweikert’s may be viewed as a boon to
some individuals who take portions of their salary in bitcoin, it also
provides a stepping stone for potential abuse of financial
surveillance powers, not just immediately, but into the future as
well. Which is a very important worry amongst many in the Bitcoin
space.

Bitcoiners should be cautious around how quickly we are seeing these
social and powerful figures flock to this revolutionary asset. It
would behoove all of us to take pause, catch our breath and reflect
before two potential scenarios play out:

One, we rush to regulate an asset that is wildly misunderstood and
provide roadblocks to those we aim to protect. And two, we rush to
support and uplift politicians who hoist the Bitcoin standard in the
desire to reach regulation of the asset before the regulatory
windfalls are well gauged or we have established understanding, so as
to avoid inviting weakness within the system itself.

Our world moves fast, but we don’t have to break things. When it comes
to state adoption, being a slow mover can be a blessing, not a curse.