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Government Bitcoin Regulations

We here to report latest news on new products and business that relates to government regulation of bitcoin, worldwide. If you need the latest bitcoin regulation news, Bitconnect will report on latest regulation on bitcoin and other crypto currency.




  • China’s National Digital Currency: A Closer Look At This Game-Changer

    ​​​​​Look at which way the wind is shifting. With Bitcoin proving to be a global technological success, it will only have a few years jump on the greater economic markets. The nation-states are ready to catch up, and China, potentially the world’s largest economy, has been working to create a national digital currency system at warp speed. Its coming arrival looms over China, but what does it mean?

    No other monetary system will have this level of speed and economic power. The Chinese Yuan has far greater reach and value than the Indian Rupee, which is also going through a national currency revolution of its own. Yet, China seems to have planned this out far better and is about ready to release a national blockchain-based Bitcoin knock-off, without the daily appreciation in value.

    China has already worked to put their entire social security system on a blockchain, so they know how to create these systems at the massive scale they need. The People’s Bank of China released the broad strokes of how it would work last year. Here are some of the more important points of contact:

    • The PBOC creates cryptocurrency and transfers it to commercial banks when more liquidity is needed
    • Consumers would top up digital currency from modified automated teller machines or from bank tellers and store it in a crypto wallet on their mobile phone or another device
    • For purchases, consumers wire from their person wallet to the merchant’s account
    • The merchant deposits the cryptocurrency into their commercial bank account

    "Cutting costs is an obvious benefit, but the impact of shifting to blockchainbased digital money from the current payment structure goes beyond that," said Larry Cao, director of content at the CFA Institute in Hong Kong to Bloomberg. "There’s potential you can pay anybody in the system, any bank, and any merchant directly. Blockchain will change the whole infrastructure. This is revolutionary."

    It is hard for China to really hide the real reason they have gone from just talking about creating a national digital currency one year ago to already testing it in 2017. The size of this project is daunting, and the fact that they are doing trials of it shows how much of a priority this is. “Capital flight” out of China is the genesis of this economic revolution, and once this is in place, controlling every citizen’s ability to do an economic transaction becomes not on easy, but educational.

    “The transparency of economic activities in every corner of the country will significantly improve," said Duan Xinxing, vice president of Beijing-based OKCoin Co. "The central bank will have unprecedented knowledge of how the economy runs. Talking about the impact of digital money now is like trying to predict how the Internet would transform lives in the 1980s. We know it’s going to be huge. It has the potential to change the entire economic infrastructure. We’re just not sure about when and how."

    As I have gone over before, all the digital currency that glitters in cyberspace is not Bitcoin. The average citizen may gain some extra convenience and lower costs over using third-party payment systems, but they will pay far more, in the long run. Now that the world’s two largest populations are going to force their nations into a digital economic surveillance state, how do you have before your financial life is entered into a state-run server for a lifetime of ‘Big Brother’s’ monitoring?

    "How long before your personal economic life" is just another meal of surveillance on your government's daily menu? The leaders of your government will come before the people of your country saying this is to serve you better, much like they did in an old 'Twilight Zone' episode. It will sound just wonderful, only once you discover the truth of the matter, it is too late for you to be saved.

    "'To serve man.....it's a......it's a COOKBOOK!'"

    Author : Evander Smart

    Evander Smart worked for many years as a Wall Street banker, and has learned how the economy is self-destructing from the inside. His travels, experience and research have led him to Bitcoin as the best way forward for the common man. He looks to spread the word on how Bitcoin can help anyone break the shackles of economic slavery being created by global establishment forces. Evander gets you thinking about what money really is, and how it will work for you going forward. The world of finance is getting ready for incredible changes, and he is getting ready for what's coming next. Are you? Learn more about "The Future of Money" @ Bitcoin Video University

  • Top Russian Regulator Endorses Bitcoin and Blockchain Technology

    ​​Is 2017 the year the Bitcoin actually gains mainstream acceptance? Every new technology, whether it is the airplane, the automobile or the Internet itself, goes through an adoption curve, and Bitcoin seems like it is approaching a new threshold. Now, regulators are making laws around it, and major players are actually complimenting it, publicly, for its innovation and capabilities.

    In Russia, this has just taken place as an executive at a major state-linked bank has come out with a rather ringing endorsement of Bitcoin and its stellar history as a secure platform. Vice-president of Russian state bank "Vnesheconombank" Nikita Smirnov told the Kommersant Russian newspaper the following:

    "Bitcoin (is) a new kind of philosophical concept,” the loosely translated quote says. “It can be compared with the bacterium, which exists separately from the man and went to a man in symbiosis. A Bitcoin in a sense positive bacterium that meets the specific needs of people, involves the most people in the process and give yourself a chance to exist. It really is a new philosophical concept, which until the end is not yet understood.”

    This is no small endorsement, as Vnesheconombank (VEB) is a Russian state corporation that is a former Soviet bank. Established for almost one hundred years, since 1922, the government of Russia uses VEB to support and develop the Russian economy and to manage Russian state debts and pension funds.

    Bitcoin (is) the only technology that has been successfully operating today". "Bitcoin - the world's only technology, which is widely used, which has existed for several years, it (has never) broke (once). Therefore, if we now ask whether there is another algorithm that established the reliability of distributed consensus, then it probably is not. If we talk about the current situation, it is really the only blockchain that we have success, it is Bitcoin,” he added.

    Here at BitConnect, we have covered the fact that there are much larger blockchains than Bitcoin, but none have the extensive history of financial security, worldwide that the world’s first blockchain has. As blockchain technology becomes more and more mainstream, this only legitimizes Bitcoin even further into the future.

    Russia has had a checkered past with Bitcoin and its acceptance into their market, but the country seems to slowly be making peace with the fact that Bitcoin is not evil and is not going anywhere. Russian authorities have also seen many ways to benefit from its blockchain technology for future government uses.

    Author : Evander Smart

    Evander Smart worked for many years as a Wall Street banker, and has learned how the economy is self-destructing from the inside. His travels, experience and research have led him to Bitcoin as the best way forward for the common man. He looks to spread the word on how Bitcoin can help anyone break the shackles of economic slavery being created by global establishment forces. Evander gets you thinking about what money really is, and how it will work for you going forward. The world of finance is getting ready for incredible changes, and he is getting ready for what's coming next. Are you? Learn more about "The Future of Money" @ Bitcoin Video University

  • India Establishment Refuses To Legitimize Bitcoin

    Living in India has been pretty hectic, one would imagine, over the last ninety days as the country’s establishment has forced the populace to go from cash to digital payments virtually overnight. Bitcoin has been thrust into the limelight as well, commanding premiums as high as 35% ever since, as the nation looks for reliable economic options. Where does India go from here with Bitcoin?

    According to The Telegraph of India, the Indian government has rejected the idea of a separate regulator for digital money, and the new digital monetary segment of finance will be under the broad purvue of the Reserve Bank of India (RBI.) It will set up a Payments Regulatory Board headed by the RBI governor to handle digital payment gateways. Officials said a separate regulator would have led to multiple financial regulators.

    "Globally the trend is towards unified regulators and the RBI is a strong institution, hence the government chose to go with it," Indian officials said.

    Attempts by Bitcoin players to come under the ambit of the new body are unlikely to succeed as the government and the RBI are not in favor of legitimizing bitcoins as legal tender. Bitcoin players in the country, which include Zebpay, Unocoin, Coinsecure and Searchtrade, have recently formed a Virtual Currency Association of India, which has started lobbying the government to allow bitcoin trading.

    However, the RBI has taken a strong stand against virtual currencies such as bitcoins pointing out that it has not issued any license or authorisation for trade in them. Officials said the amendments they were working on would try to bring parity between physical cash and digital transactions along with interoperability and access to a unified payment infrastructure.

    The government has been trying to push digital payments ever since it banned old Rs 500 and Rs 1000 notes on November 8, which constituted some 86 percent of the country's currency by value, hoping to push more transactions towards being digital to monitor transactions. Government data show that between November 8, when demonetization was announced, and December end mobile payment transactions in volume terms rose a whopping 5000 percent.

    Indian tax experts say that the push towards digital money did not mean the end of black money. It is possible to generate and transfer black money or untaxed money even through the digital mode. Besides, cash deals do not necessarily mean untaxed transactions. However, the thinking within the government appears to equal cash with untaxed or "dirty" money, while digital transactions are likely to be "clean" transactions.

    "I want to tell my small merchant brothers and sisters, this is the chance for you to enter the digital world," India’s prime Minister Narendra Modi said. "It's correct that a 100 percent cashless society is not possible. But why don't we make a beginning for a less-cash society in India? We can gradually move from a less-cash society to a cashless society.

    Author : Evander Smart

    Evander Smart worked for many years as a Wall Street banker, and has learned how the economy is self-destructing from the inside. His travels, experience and research have led him to Bitcoin as the best way forward for the common man. He looks to spread the word on how Bitcoin can help anyone break the shackles of economic slavery being created by global establishment forces. Evander gets you thinking about what money really is, and how it will work for you going forward. The world of finance is getting ready for incredible changes, and he is getting ready for what's coming next. Are you? Learn more about "The Future of Money" @ Bitcoin Video University

  • Japan Creates BitLicense 2.0 As Bitcoin Becomes a Legal Currency

    ​​BitConnect was among the very first websites online to break the story of Japan legalizing Bitcoin as a national currency last Spring. It was one of our most-read, probably our most-read, articles to date, and for good reason. It was one of the Top 25 stories of last year on Reddit, with tens of thousands of views and shares. Now, it is time for Bitcoin to go legally live in Japan, and the details are coming out on its regulatory limits. Less than good news to report, people.

    How BitLicense 2.0 Works

    I guess we should start with the regulatory standard, or substandard, for Bitcoin governance which is New York’s BitLicense, started in 2014, revised in 2015, and I have railed about it since Day One. Keeping it short and sweet, if BitLicense’s goal was to keep Bitcoin businesses out of new York state, it was crafted masterfully. After over two years of the books, only three corporations, none of them a small company by any means, have obtained a license.

    Circle, Ripple, and Coinbase just got one, two years later. Many critics see BitLicense as purely a way to protect the incumbent legacy banking industry from competition from digital currency industry, and that is how this is playing out. It is several hundreds of thousands of dollars to have the compliance, insurance, and legal strength to fulfill all their requirements. It can be $100k just to apply, after all, costs are considered, according to Bitstamp. This makes it so onerous that mid-size companies like ShapeShift, BitStamp, and LocalBitcoins to not do business in New York at all. Maybe that was the point of BitLicense?

    Forgive Japan if they are more than a little gunshy about the world of digital currency, but they do have a right to be skittish. Mt. Gox devolved into the biggest Bitcoin scam in history, happening right in the center of Tokyo, and currently, there are pyramid schemes in the name of falsified digital coins that have cost Japanese investors at least $20 Million worth of Yen, recently. The lowly scammers are doing an excellent job of ruining a great thing for the rest of us. In 2017, the Bitcoin community will have to pay for the mistakes of the few.

    Last year, the finer details on how bitcoin and its related businesses would be related were not made public, as they were not hashed out at that time, so all we had was the broad strokes of the legal agreement. Now, with the help of a blog post from Koji Higashi, the Co-Founder of IndieSquare, who is much closer to the situation providing the nations detailed plans, the adoption looks less like an adoption nd more like a sentence, at least if you intend to do any level of Bitcoin business, not so much the investment side

    “Contrary to the popular narratives so far,” says Higashi, I personally have serious doubt about this law being a long term positive for the Japanese community and it may even set a bad precedent for other areas of the world similar to how people in the community were worried about the Bitlicense.

    Why this will slow Bitcoin business growth

    These are the reasons he is so pessimistic about the net effect on the Bitcoin community in Japan. Items required to even start a business in this industry include a Submission of a 3-year business plan, a detailed and approved organizational structure, join the government appointed industry association, implementation of an internal training program for compliance and virtual currency management, segregated fund management, frequent reporting to their national authority, external audit KYC/AML requirements, required to gather customer information from all users even for $1 worth of trading. Then we’ll do the paperwork required…...

    Overall, just in order to meet all the conditions above and become properly registered, says Higashi, “it is estimated to cost around $300,000~$500,000 USD equivalent for the applicant(a rough estimation by a few experts that I have talked to). That’s for the initial registration and of course, the cost of staying compliant and submitting more paperwork as it scales can add up to potentially millions of dollars.

    Also, don’t expect to create a new altcoin anytime soon. “Only approved virtual currencies by the authority are considered legitimate and can be traded, sold or promoted to the public,” according to the letter of the law. So, in short, if they haven’t heard of your coin before, you are not getting approved.

    And all of these regulations apply to non-custodial businesses, meaning if the company never holds one coin for another person, never has control of another person's digital currency, but you are in this industry, you will have to jump through all these time-consuming and expensive legal hoops. Sound familiar?

    Looks like it is going to do what it is intended to do, for now

    In closing, what this level of regulation will do is prevent the legitimate young techie who is looking to innovate from ever getting started. What it will do is coddle the banking establishment, and protect them from a broad-scale attack of potentially dozens of innovative, niche digital currencies. How many bankers, lobbyists and lawyers, who are paid by the establishment, did it take to come up with these regulations? How much input and influence did the digital currency community have in these regulations?

    Japan has basically copied New York’s BitLicense and just added their spin on it. BitLicense has made a blueprint for protecting the legacy banking industry from competition, curtailing the innovations the digital currency industry can provide consumers, and removed any testbeds for discovering what these new technologies can and can’t do. If your digital currency, the blockchain, or business model is not overfunded, rock solid, and basically perfected, you will not get clearance in The Land of The Rising Sun. Mission accomplished.

    If this can be done in two of the world's biggest markets, New York and Tokyo, how long before the rest of the world runs down this regulatory choke point? Will this level of regulation force the digital currency ecosystem to evolve and become more stealth, as it can’t comply with this level of restrictions by the agents of the establishment?

    Do New York and Japan really think that overregulating this innovation will really stifle new competitors and cut them off, in the long run? Or will they just create a larger black market they can't control at all in the years to come?

    The establishment may win this legal battle they have created, but they may end up losing the war.

    Author : Evander Smart

    Evander Smart worked for many years as a Wall Street banker, and has learned how the economy is self-destructing from the inside. His travels, experience and research have led him to Bitcoin as the best way forward for the common man. He looks to spread the word on how Bitcoin can help anyone break the shackles of economic slavery being created by global establishment forces. Evander gets you thinking about what money really is, and how it will work for you going forward. The world of finance is getting ready for incredible changes, and he is getting ready for what's coming next. Are you? Learn more about "The Future of Money" @ Bitcoin Video University

  • Bitcoin Regulations by The Central Bank of The Philippines Begins

    As Bitcoin becomes accepted in more and more nations around the world, the regulatory risk increases every day. What was legal one day may be illegal the next, and governments love the ability to control and track their citizens. The central bank of the Philippines has begun an initiative to exert more control over Bitcoin exchanges and how they do business.

    The central bank of the Philippines, or the BSP, has created a new set of guidelines for the use of digital currencies in the country under what is known as BSP Circular No. 944. Under this new edict, the central bank has reaffirmed itself as the sole authority that can offer legal tender currency through official bank notes. They also are going to require Bitcoin businesses, like exchanges, to officially register with the BSP.

    Bangko Sentral recognizes that virtual currency (VC) systems have the potential to revolutionize delivery of financial services, particularly for payments and remittance, in view of their ability to provide faster and more economical transfer of funds, both domestic and international, and may further support financial inclusion, read the circular as signed by BSP Deputy Governor and officer-in-charge Nestor A. Espenilla, Jr.

    These benefits, however, should be considered along with the corresponding risks in VCs considering the higher degree of anonymity involved, the velocity of transactions, volatility of prices and global accessibility.

    The best way to exert control over the users of Bitcoin is to hit them when they exchange their digital currency into paper currency. The BSP wants to limit the ability to launder “black money,” or ill-gotten, undeclared funds.

    You have to make a distinction between the creators of bitcoin, you cannot regulate that because they are all over the world,” Mr. Espenilla told reporters late Monday. “So what we’ll regulate are the exchanges where the bitcoins or virtual currencies are exchanged for real money -- the intersection between the virtual world and real world, yun ang binabantayan namin”

    In effect, the BSP will be treating Bitcoin and its related businesses like a true financial services company, similar to credit cards, check cashing and so on, effectively validating the digital industry through these new regulations. Local Bitcoin business experts in the area said the BSP’s new set of rules formally welcome virtual currency in the local financial system, and the regulatory clarity is appreciated.

    “The circular is a positive step for Bitcoin firms and users, for sure,” said John Bailon, co-founder and chief executive officer of Bitcoin service provider Satoshi Citadel Industries. “It provides a framework wherein Bitcoin companies such as ours to operate legally and in compliance with rules and regulations set forth by the BSP.”

    BSP offered their first public notice advising against the use of digital currency in the aftermath of the collapse of Mt. Gox Bitcoin exchange back in March of 2014. Apparently, with more people using the currency since, these new, more aggressive measures were deemed necessary.

    Author : Evander Smart

    Evander Smart worked for many years as a Wall Street banker, and has learned how the economy is self-destructing from the inside. His travels, experience and research have led him to Bitcoin as the best way forward for the common man. He looks to spread the word on how Bitcoin can help anyone break the shackles of economic slavery being created by global establishment forces. Evander gets you thinking about what money really is, and how it will work for you going forward. The world of finance is getting ready for incredible changes, and he is getting ready for what's coming next. Are you? Learn more about "The Future of Money" @ Bitcoin Video University

  • Bitcoin Exchanges in China Change Trading Rules After Regulator Visit

    ​he world of Bitcoin is a new, exciting, and largely unregulated place. This has its pros and cons, but the recent bubble bursting earlier this month caused quite a stir in China, where the lion’s share of the world’s Bitcoin trading takes place. The issues uncovered were enough to draw regulators into the top three Bitcoin exchanges in the world, and this, in turn, has driven these exchanges to alter they way they will do their Bitcoin business transactions in 2017.

    The end of a Golden Era in Bitcoin Trading

    In China, these massive exchanges have made their volumes explode due to their no-fee trading policies. This has attracted new business and has forced a fierce competition for that no-fee business. This has also led to inflated volume trading numbers, as many of these trade made were account owners trading to themselves to drive down their withdrawal fees, the way the exchanges actually earn an income in this business model.

    "(Since there are no transactional fees,) Chinese exchanges generate most of their revenue from CNY withdrawal fees,” said Neil Woodfine, Chief Operating Officer of Remitsy earlier this month. “And these CNY withdrawal fees are tiered based on each trader’s trade volume, encouraging traders to trade as much as possible to lower the cost of withdrawing their profits".

    Problem was that the sheer number of trades attempting to take place when Bitcoin was dropping fast prevented many from accessing their funds and protecting their digital wealth. We reported that some changes were likely to come after this calamity, and some consumer complaints, some discussions with regulators and some internal meetings generated the following policy changes. These will take effect in all three major Chinese exchanges, BTCC, Huobi, and OKCoin, starting tomorrow. Here’s the message on OKCoin’s News page.

    In order to curb speculation and prevent price volatility, currency OKCoin line will take effect January 24, 2017, 12:00 start charging transaction fees, specific adjustments are as follows: 1. Transaction fees according to a fixed proportion collect, sell the yuan, to buy or collect bitcoin, litecoin; 2. active and passive auction turnover rates; 3. service fee charged by a fixed rate of 0.2% of turnover.

    A similar message can be seen on the other exchange’s blogs, news pages, or Twitter feeds. This should reveal the true trading volume of each, and rebalance the market, somewhat. Interestingly, the London’s Coinfloor announced this weekend that they are going to a no-fee trading strategy, effective immediately, obviously to fill this market void and attract a new level of volume from traders around the world.

    So no shortage of major changes in major markets, with Donald Trump getting inaugurated on Friday, Chinese exchanges and their regulators changing their trading practices and Coinfloor looking to become a global force. The news may have influenced the buying market, as Bitcoin values rose about 3% over the weekend.

    Author : Evander Smart

    Evander Smart worked for many years as a Wall Street banker, and has learned how the economy is self-destructing from the inside. His travels, experience and research have led him to Bitcoin as the best way forward for the common man. He looks to spread the word on how Bitcoin can help anyone break the shackles of economic slavery being created by global establishment forces. Evander gets you thinking about what money really is, and how it will work for you going forward. The world of finance is getting ready for incredible changes, and he is getting ready for what's coming next. Are you? Learn more about "The Future of Money" @ Bitcoin Video University

  • European Union Seeks to Fast-Track Bitcoin-bashing Regulations

    The crumbling dystopia that has become the globalist precursor know as the European Union has many problems. Many nations, if not most nations, are suffering from what seems to be an orchestrated destabilization of un-vetted immigration, leading to rampant crime waves that include, robbery, assault, and rape. One might characterize this alone as a mass exercise of terrorism. This pressing issue of rampant crime seems to be exploding, but the E.U. wants to get this problem with Bitcoin solved before the end of 2017.

    Maybe you haven’t heard…..

    The European Parliament has recently published “The Juncker Commission’s ten priorities” for 2017. These are ten issues that they see as most important to address in 2017 for the member states, and Bitcoin made this list. It seems Bitcoin has been labeled as a funding source for terrorism. Strike that.

    They obviously cannot say that Bitcoin is a funding source for terrorism, but they say “risks linked to” terrorism, in effect proving that this initiative is more of a witch hunt and power grab than an actual solution to a real problem. Here is their quote in their new report, which can be seen here

    Under subheading “Priority 7: An area of justice and fundamental rights based on mutual trust,”it states within the subsection “Fighting terrorism:”

    In July 2016, the European Commission proposed targeted amendments to the 2015 Fourth Anti-Money Laundering Directive. The issues addressed include safeguards for financial flows from high-risk third countries, EU financial intelligence units’ powers, centralized national bank and payment account registers, and risks linked to virtual currencies and anonymous pre-paid cards.

    The report does have plenty of hyperlinks leading to more European Union missives and directives. Bitcoin falls under the “Fourth Money Laundering Directive,” which refers to Bitcoin as “electronic money,” leads to more interesting quotes. Let’s look at the E.U’s views on people having Euros of any quantity, and how they’ll limit that ability.

    The use of large cash payments is highly vulnerable to money laundering and terrorist financing. In order to increase vigilance and mitigate the risks posed by such cash payments, persons trading in goods should be covered by this Directive to the extent that they make or receive cash payments of EUR 10,000 or more.

    Under Article 12 of the Directive, the regulation specifies if you have more than 250 Euros, you are to be subject to full “due diligence” disclosure, explained thusly:

    “….a Member State may allow obliged entities not to apply certain customer due diligence measures with respect to electronic money", where all of the following risk-mitigating conditions are met:

    (a) the payment instrument is not reloadable, or has a maximum monthly payment transactions limit of EUR 250 which can be used only in that Member State;

    (b) the maximum amount stored electronically does not exceed EUR 250;

    (c) the payment instrument is used exclusively to purchase goods or services;

    (d) the payment instrument cannot be funded with anonymous electronic money;

    In other words, expect to be subject to any and all kinds of attacks on your freedoms and dealings if you have more than 250 Euros worth of BTC linked to you if you are European Union property, that is. If you are packing this much dangerous electronic heat, you could be accused of anything, from tax evasion, to terrorism funding, to money laundering, or anything else the globalist state wants to attach to you.

    No wonder why the United Kingdom voted themselves out of this unelected mess, while the somewhat free people of Italy and France are angling to move on to better things later this year in upcoming referendums and elections. Globalism is losing to nationalism, and this may be just the beginning.

    Keep in mind the United Kingdom, France, and Italy make up three of the top four economies within the European Union, not including Germany, who has maintained the majority of the control of its governance and power, so they are not going anywhere. Yet, if another major force within departs, the E.U. should collapse in full by the end of the decade, IMO.

    The chances that both disengage is good enough where some E.U. leaders are considering preventing future referendums to keep Member States captive in this political failure. A former member of The Communist Party, Slovak Prime Minister Robert Fico, stated that the EU was struggling with various problems and he begged the 27 other EU members not to allow any more referendums, saying ”The people could not be allowed to decide their own future."

    Author : Evander Smart

    Evander Smart worked for many years as a Wall Street banker, and has learned how the economy is self-destructing from the inside. His travels, experience and research have led him to Bitcoin as the best way forward for the common man. He looks to spread the word on how Bitcoin can help anyone break the shackles of economic slavery being created by global establishment forces. Evander gets you thinking about what money really is, and how it will work for you going forward. The world of finance is getting ready for incredible changes, and he is getting ready for what's coming next. Are you? Learn more about "The Future of Money" @ Bitcoin Video University

  • Coinbase CEO Makes Officially Responds to IRS Tax Summons

    ​​The new year has not brought a new resolution to the pending issue between Bitcoin mega-corporation Coinbase and the IRS. About six weeks ago, the IRS filed a “John Doe” summons against Coinbase, and Coinbase alone, seeking an extreme amount of information on any and all users of their services from 2013-2015.

    This information includes transaction history, IP addresses, transcripts with customer support, and much more information, essentially treating every person who used Coinbase as a criminal. Over the weekend, Coinbase CEO Brian Armstrong fired back, speaking truth to power.

    Punished for being an American company

    Being an American sounds pretty darn sweet to many people around the world, but there is a price to pay for residing in “The Land of the Free.’ One of the prices extolled is mass surveillance, and this price is growing almost every day. The government seems to have an unlimited power, at the moment, to take any and all information about any American company and/or individual, and Coinbase is fighting this latest precedent-setting power grab in court.

    “We have worked to comply with all IRS guidance in our space, beginning with the March 2014 guidance on virtual currency,” said Armstrong in his Medium blog post. “I believe Coinbase and the IRS fundamentally want the same thing: for all U.S. users of virtual currency to pay their taxes. I also feel that the IRS sending us a John Doe summons on all customer accounts is not the best way for us to mutually accomplish this objective.”

    The official summons identifies exactly one taxpayer, identified as “Taxpayer 1,” and two companies, known as Taxpayers 2 and 3, who deal in Bitcoin and who knowingly used Bitcoin to avoid paying taxes required by the IRS. So, in other words, the summons has implicated three taxpayers and Coinbase is now unable to protect the identities of users.

    Coinbase receives this personal information from consumers under the guise that it will be safe from thrid parties, and this flies in the face of that, on top of unconstitutional illegal search and seizure statutes.

    “Their most recent subpoena asks us to turn over records on all customers. Suffice to say, we feel the IRS’s subpoena is overly broad and incorrectly implies that all users of virtual currency are evading taxes. Asking for detailed transaction information on so many people, simply for using digital currency, is a violation of their privacy, and is not the best way for us to accomplish our mutual objective.”

    Coinbase also rightly points out that they are being attacked in this legal manner, penalized, due to the fact that they are based in the United States and are essentially an easy target. Armstrong points out that other exchanges not based in the U.S. are not treated this way and would not be bound to fight the IRS legally. Given the amicable history between the two, Armstrong believes the IRS could have handled this better, and made it easier for users to report like other investors have seen in other industries.

    “Sadly, given the overly broad subpoena, it appears we will be forced to contest it in court to protect our customers privacy, at great expense. My hope is that the IRS is willing to work with us to establish a sensible reporting mechanism, like 1099 reporting that all brokerage services like Fidelity and Charles Schwab use. A protracted legal battle, seeking to reveal private information from people who are not evading taxes, would be bad for Coinbase, the IRS, and many U.S. citizens.”

    Author : Evander Smart

    Evander Smart worked for many years as a Wall Street banker, and has learned how the economy is self-destructing from the inside. His travels, experience and research have led him to Bitcoin as the best way forward for the common man. He looks to spread the word on how Bitcoin can help anyone break the shackles of economic slavery being created by global establishment forces. Evander gets you thinking about what money really is, and how it will work for you going forward. The world of finance is getting ready for incredible changes, and he is getting ready for what's coming next. Are you? Learn more about "The Future of Money" @ Bitcoin Video University

  • Bitcoin Banned in Colombia

    ​​Finding good news about the exciting world of Bitcoin and decentralized digital currency isn’t hard to find these days. Exchanges around the world are reporting trading records, the Bitcoin price has reached three-year highs, and even the mainstream media is feeling Bitcoin fever. Yet, not every nation in the world is enamored with “The Internet of Money,” as the South American nation of Colombia has decided to end 2016 by banning Bitcoin usage, domestically.

    Bitcoin ‘Investment Clubs’ Blamed

    Francisco Reyes Villamizar, the superintendent of Colombia’s Superintendencia de Sociedades, made the announcement before the New Year’s holiday that the only legal currency in Colombia is the peso, making Bitcoin’s digital currency illegal. The problem stems from the growing cottage industry of Bitcoin ‘Investment clubs.’ 

    Reportedly dozens of citizens in the country have filed formal complaints of these firms who operate as ‘pyramid schemes.’ The operators offer fantastic returns in excess of 100% in a matter of a couple of months in exchange for investments and referrals to more investors.

    "Investors should know that they are exposed to enormous risks by investing in alleged currencies that have not been accepted as legal in the country," Reyes Villamizar said. “These so-called advisers promise investors to manage their bets on investment platforms and generate higher returns than they would get if they bet their money directly (loosely translated).”

    These individuals and companies usually operate under pseudonyms and organize forums and ‘private’ meetings on different technology platforms to leave no trace. Exactly how Bitcoin would be banned by the average mobile wallet user has not been determined, and the ban may only apply to such business-related uses like investment startups.

    This marks the first official banning of Bitcoin on any national scale that we have discovered. As we reported last year, regulators within Russia were considering their own ban, with the potential for up to seven years of prison time for the use of Bitcoin, but have since relented. Bitcoin investment at sites like LocalBitCoins.com has grown to new heights over the last six months.

    Many nations have seen the nation’s central bank issue an official warning against the use of “virtual currencies,” as ion the African nation of Kenya, for example. However, an outright government ban is not commonly seen, much less enforced. Nations are much more likely to create their own version of Bitcoin, as we have previously reported. The nation of Japan has gone so far as to legalize Bitcoin use officially, and put its value on par with the Japanese Yen.

    Author : Evander Smart

    Evander Smart worked for many years as a Wall Street banker, and has learned how the economy is self-destructing from the inside. His travels, experience and research have led him to Bitcoin as the best way forward for the common man. He looks to spread the word on how Bitcoin can help anyone break the shackles of economic slavery being created by global establishment forces. Evander gets you thinking about what money really is, and how it will work for you going forward. The world of finance is getting ready for incredible changes, and he is getting ready for what's coming next. Are you? Learn more about "The Future of Money" @ Bitcoin Video University

  • European Union Begins Crackdown on Bitcoin and Altcoins in the name of Fighting Terrorism

    ​The narrative that “terrorism” is a great reason to take everyone’s freedom’s and privacy is being played out in the E.U. on a daily basis. Whether it is women being taught to wear makeup over bruises from immigrant attacks to restrictions on cash and precious metal usage, the E.U. is quickly collapsing into a failing socialist state. As Bitconnect has reported previously, Bitcoin is certainly on the list of nice things the average citizen can’t be trusted with int he region, and even altcoins are under attack by the new E.U. regulations.

     

    The E.U. Council created an official draft last week outlining its position for more stringent EU rules set to prevent “money laundering and terrorist financing.” The draft directive has two main objectives: To prevent the financial system to finance criminal acts is used; the transparency rules should be tightened to prevent money be kept secret on any large scale.

    Using recent “terrorist” events, what some are calling “false flags,” as justification, this draft directive aims to ensure a balanced balance between the need for increased security and the need to protect fundamental rights and economic freedoms. The proposal is part of the Action Plan the Commission to combat the financing of terrorism.

    First on the list is limiting the “risks associated with prepaid cards and virtual currency.” The threshold for determining holders of prepaid cards has been reduced from € 250 to € 150 and the requirements for the review of customers have been extended. Exchange platforms for any and all virtual currencies and providers of electronic purses must comply with their due diligence and conduct customer checks to remove the anonymity of such exchange transactions. This is what they said about cataloging digital currency users:

    “The report shall be accompanied, if necessary, by appropriate proposals, including, where appropriate, with respect to virtual currencies, empowerments to set-up and maintain a central database registering users' identities accessible to FIUs, as well as self-declaration forms for the use of virtual currency users.”

    Of course, a central database can be hacked from the outside, or surveillance from the inside, which is safety features of Bitcoin and other digital currencies users are trying by being decentralized in practice, but this of course if of no concern to the E.U. Council or Commission.

    European Union Member States have 12 months to transpose the directive into national legislation. However, longer deadlines (24 or 36 months) apply to the implementation of the various provisions relating to the registers of economic owners.

    One of the many flaws in this pending legislation is that it has been proven that Bitcoin is not a source of terrorist funding. The HM Treasury in Great Britain spent 2015 doing an exhaustive review of all the sources of terrorism funding and Bitcoin came in at the bottom of the list, with cash and bank transfers being the primary sources. For details on this U.K. study on the matter,click here.

    The E.U. legislators have clearly not done nearly the research as the HM Treasury, and have provided no information showing Bitcoin to be a source of terrorism financing, but they intimate that it could be used in the future, so the spin is that are basically being proactive.

    Author : Evander Smart

    Evander Smart worked for many years as a Wall Street banker, and has learned how the economy is self-destructing from the inside. His travels, experience and research have led him to Bitcoin as the best way forward for the common man. He looks to spread the word on how Bitcoin can help anyone break the shackles of economic slavery being created by global establishment forces. Evander gets you thinking about what money really is, and how it will work for you going forward. The world of finance is getting ready for incredible changes, and he is getting ready for what's coming next. Are you? Learn more about "The Future of Money" @ Bitcoin Video University