Is bitcoin money?
Scary stories appeared in The New Yorker . The publication tells about a couple from Texas, which was heading to Louisiana across the border in order to buy a used car. They took with them all their savings in cash. The police stopped them for finding money in a tiny tube. The case ended with the arrest of both.
But then everything worked out for the couple - state robbers made a deal with people - the couple left the prison without any problems in exchange for money. Although their children could be left without parents and be abandoned either in the children's home or given to foster families, the state criminals did not care about their fate. Moreover, it is legal! Under US civil law, the state has the right to confiscate assets. In fact, this law has become a huge source of revenue for the government (the Ministry of Justice for 2012 collected $ 4.2 billion through such a robbery).
However, consider another scenario. The couple was stopped, but they had no cash. At all. Instead, they owned different cryptocurrencies lying on one of the smartphones. And when people got to their destination, they cashed out their money without any problems by buying a used car.
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And here the question arises: Bitcoin - possible protection against robbery by the state?
Consider another case. Agrentina. In this country, which now has an extreme level of control over the movement of capital, control over prices, huge inflation, cryptocurrency saves many. Perhaps Argentina is the first country on the planet with the highest rate of propagation of Bitcoin. Everything, including rent and land prices, is currently being exchanged for Bitcoin. Cryptocurrency is bought to circumvent legal non-legal barriers in order to be used in transactions later.
In other words, cryptocurrency is used as money. This is a new problem for regulators. Most dollar transactions are digital.
On the other hand, the cryptocurrency is a computer code. It has an advantage over the dollar, for it is part of mathematics. But the problem is much deeper for understanding and perception of many cryptocurrencies as money.
Cryptocurrencies create real problems for state regulators. Bitcoin contributes to the growth of economic relations and the use of cryptocurrency is expanding every day. This is greatly facilitated by merchants. The government can ignore this state of affairs, or pretend that it does not consider Bitcoin for new money. This is the path of denial. The state, of course, without evidence, is convinced that only the government can create and earn money, and all other attempts are illegal.
This trend is quite dangerous for officials, since the growth in the use of cryptocurrency can not be stopped.
Another way is to recognize the fact that it is money that is currently used as money. At least the regulators and the government can try to maintain their role as supervisors. But this path is dangerous, because the handling and use of the monetary properties of Bitcoin suggests the creation of new paths of legal legitimacy. And attempts to ban cryptocurrencies will end with the emergence of new incentives for the further introduction and use of cryptocurrencies.
This problem was faced by a federal judge in a well-known case with a scam of the company “Bitcoin investment and loans”. In 11-12, Trendon Shavers took hundreds of thousands of Bitcoin cryptocurrency coins, promising 7% of the profits. However, this is hard to believe, but he was able to spend all the money. (It is hard to imagine that a huge amount was entrusted to a person with the nickname “pirateat40”.)
In any case, in its defense, the Shavers argued that Bitcoin cryptocurrency was not really money. He just got the codes and nothing else. Therefore, he can not be punished for fraud in securities trading or fraud on the stock exchanges, or be punished by tax laws and other regulators. A federal judge did not agree, and stated that Bitcoin has all the signs of money.
The judge announced his verdict:
“It is clear that Bitcoin is used as money. Various goods and services are bought for coins, as well as the respondent himself stated. The only limitation is that Bitcoin is not universally accepted as a currency. However, a currency can also be exchanged for other currencies, such as the US dollar, the euro, the yen and the yuan. Therefore, Bitcoin is a currency - a new form of money that investors use for savings. "
The federal judge made it clear that he considers cryptocurrencies to be money, the use of which is a reality, that he did not foresee in the recent past. Cryptocurrency has ideal properties that are characteristic of money. It has value, as well as fiat money, which arose gradually since 2009.
There was something else interesting, and, in a certain sense, amusing in the words of the judge. The judge writes: “Bitcoin is an electronic form of currency, unsecured with real assets, but with signs of precious coins or metals.”
Interestingly, we are talking about the dollar - word for word.
Every time I tell people about the cryptocurrency problem, people convince me that the government will definitely destroy cryptocurrency due to its power, taxation, and the like. But let's make some differences. Of course, the government can regulate the exchange between the government and Bitcoin currency. It already does it. Speech only that regulation can amplify. The government can certainly also try to regulate Bitcoin revenues, as it does in finance in other areas. The government may also oversee contracts and regulations with securities transactions in Bitcoin.
Nevertheless, the Bitcoin system is cryptographically protected and protects all exchange transactions that are decentralized, i.e. distributed throughout the server model. And this is not a private company. Not a stock. Not a product. Cryptocurrency is not someone's subject, which someone owns and manages. In this sense, it is impossible to destroy Bitcoin. Neither government officials, nor anyone else. This is akin to trying to destroy algebra. That is why officials have a huge interest in cryptocurrency. She is a threat to them, a threat to her future. Conferences are convened. On them, officials discuss the legal and economic implications for themselves.
And for this very reason, many people associated with Bitcoin cryptocurrency are not afraid of government intervention. People are sure that the statements from the mouth of the federal judge are higher, as well as the activation of officials with their exchange rules, etc., in fact, signs that Bitcoin has long been recognized as money. Their essence is invulnerability. The government only hopes for its participation in all processes through the control of the cryptocurrency source code. And it is impossible to control him.
Meanwhile, academic economists can continue the discussion of what to call Bitcoin. The market has already solved this problem. People in black robes only explained that cryptocurrencies became a new reality in the economic life of people in the digital age.
Article by Jeffrey Tucker .
Translation of my article.
But then everything worked out for the couple - state robbers made a deal with people - the couple left the prison without any problems in exchange for money. Although their children could be left without parents and be abandoned either in the children's home or given to foster families, the state criminals did not care about their fate. Moreover, it is legal! Under US civil law, the state has the right to confiscate assets. In fact, this law has become a huge source of revenue for the government (the Ministry of Justice for 2012 collected $ 4.2 billion through such a robbery).
However, consider another scenario. The couple was stopped, but they had no cash. At all. Instead, they owned different cryptocurrencies lying on one of the smartphones. And when people got to their destination, they cashed out their money without any problems by buying a used car.
')
And here the question arises: Bitcoin - possible protection against robbery by the state?
Consider another case. Agrentina. In this country, which now has an extreme level of control over the movement of capital, control over prices, huge inflation, cryptocurrency saves many. Perhaps Argentina is the first country on the planet with the highest rate of propagation of Bitcoin. Everything, including rent and land prices, is currently being exchanged for Bitcoin. Cryptocurrency is bought to circumvent legal non-legal barriers in order to be used in transactions later.
In other words, cryptocurrency is used as money. This is a new problem for regulators. Most dollar transactions are digital.
On the other hand, the cryptocurrency is a computer code. It has an advantage over the dollar, for it is part of mathematics. But the problem is much deeper for understanding and perception of many cryptocurrencies as money.
Cryptocurrencies create real problems for state regulators. Bitcoin contributes to the growth of economic relations and the use of cryptocurrency is expanding every day. This is greatly facilitated by merchants. The government can ignore this state of affairs, or pretend that it does not consider Bitcoin for new money. This is the path of denial. The state, of course, without evidence, is convinced that only the government can create and earn money, and all other attempts are illegal.
This trend is quite dangerous for officials, since the growth in the use of cryptocurrency can not be stopped.
Another way is to recognize the fact that it is money that is currently used as money. At least the regulators and the government can try to maintain their role as supervisors. But this path is dangerous, because the handling and use of the monetary properties of Bitcoin suggests the creation of new paths of legal legitimacy. And attempts to ban cryptocurrencies will end with the emergence of new incentives for the further introduction and use of cryptocurrencies.
This problem was faced by a federal judge in a well-known case with a scam of the company “Bitcoin investment and loans”. In 11-12, Trendon Shavers took hundreds of thousands of Bitcoin cryptocurrency coins, promising 7% of the profits. However, this is hard to believe, but he was able to spend all the money. (It is hard to imagine that a huge amount was entrusted to a person with the nickname “pirateat40”.)
In any case, in its defense, the Shavers argued that Bitcoin cryptocurrency was not really money. He just got the codes and nothing else. Therefore, he can not be punished for fraud in securities trading or fraud on the stock exchanges, or be punished by tax laws and other regulators. A federal judge did not agree, and stated that Bitcoin has all the signs of money.
The judge announced his verdict:
Bitcoin was designed to reduce transaction costs, which allows users to perform exchange operations by creating open protocols. Bitcoin can be used to buy goods online, in addition, some retailers have begun to accept Bitcoin in exchange for gift cards or other purchases. The cost of a Bitcoin coin varies, ranging from $ 2 per coin to more than $ 260 ...
“It is clear that Bitcoin is used as money. Various goods and services are bought for coins, as well as the respondent himself stated. The only limitation is that Bitcoin is not universally accepted as a currency. However, a currency can also be exchanged for other currencies, such as the US dollar, the euro, the yen and the yuan. Therefore, Bitcoin is a currency - a new form of money that investors use for savings. "
The federal judge made it clear that he considers cryptocurrencies to be money, the use of which is a reality, that he did not foresee in the recent past. Cryptocurrency has ideal properties that are characteristic of money. It has value, as well as fiat money, which arose gradually since 2009.
There was something else interesting, and, in a certain sense, amusing in the words of the judge. The judge writes: “Bitcoin is an electronic form of currency, unsecured with real assets, but with signs of precious coins or metals.”
Interestingly, we are talking about the dollar - word for word.
Every time I tell people about the cryptocurrency problem, people convince me that the government will definitely destroy cryptocurrency due to its power, taxation, and the like. But let's make some differences. Of course, the government can regulate the exchange between the government and Bitcoin currency. It already does it. Speech only that regulation can amplify. The government can certainly also try to regulate Bitcoin revenues, as it does in finance in other areas. The government may also oversee contracts and regulations with securities transactions in Bitcoin.
Nevertheless, the Bitcoin system is cryptographically protected and protects all exchange transactions that are decentralized, i.e. distributed throughout the server model. And this is not a private company. Not a stock. Not a product. Cryptocurrency is not someone's subject, which someone owns and manages. In this sense, it is impossible to destroy Bitcoin. Neither government officials, nor anyone else. This is akin to trying to destroy algebra. That is why officials have a huge interest in cryptocurrency. She is a threat to them, a threat to her future. Conferences are convened. On them, officials discuss the legal and economic implications for themselves.
And for this very reason, many people associated with Bitcoin cryptocurrency are not afraid of government intervention. People are sure that the statements from the mouth of the federal judge are higher, as well as the activation of officials with their exchange rules, etc., in fact, signs that Bitcoin has long been recognized as money. Their essence is invulnerability. The government only hopes for its participation in all processes through the control of the cryptocurrency source code. And it is impossible to control him.
Meanwhile, academic economists can continue the discussion of what to call Bitcoin. The market has already solved this problem. People in black robes only explained that cryptocurrencies became a new reality in the economic life of people in the digital age.
Article by Jeffrey Tucker .
Translation of my article.
Source: https://habr.com/ru/post/206056/
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