Cryptocurrencies regulations are back on the radar as congress has backed a Bill, on August 7, that would tighten tax compliance on cryptocurrencies. The new technology sector has a current market capitalization of 1.7 trillion USD.
If the Bill comes into law, it will be a kill shot to decentralized finance and a global internet payment system based primarily on the Ethereum blockchain network.
The know your customer KYC requirements for taxation reasons would make it impossible to build a global internet payment system using a proof of state protocol
Bitcoin aficionados can breathe a sigh of relief as the proposed infrastructure Bill, which covers cryptocurrencies regulations, has given the thumbs up to proof of work protocol used by Bitcoin.
“Cryptocurrencies regulations are back on the radar as congress has backed a Bill, on August 7, that would tighten tax compliance on cryptocurrencies”
Frankly, we are surprised that Cryptocurrencies regulations would attack proof of state in favor of proof of work protocol cryptocurrencies, which will drastically reduce the utility and development of the new technology.
Moreover, so much noise was made that proof of work mining was energy inefficient, a drain on hardware resources, and that proof of state would be more environmentally suitable for high volume transactions.
Ethereum’s recent London Fork, which entailed migrating the secure blockchain network onto proof of state protocol was considered a big deal.
The cryptocurrency community has slammed such a move as being disastrous for the development of cryptocurrencies. Here are some comments of big investors regarding cryptocurrencies regulations.
“This is like taxing and regulating the internet in the early 90s and the internet represents the next evolution of the internet in terms of building a global payment system” said Cathie Wood
“This is like taxing and regulating the internet in the early 90s and the internet represents the next evolution of the internet in terms of building a global payment system”
Cryptocurrencies regulations would force innovation offshore and deprive the US of the fruits of the next great innovations of the internet, noted Cathie Wood.
Charles Hoskinson said the following; “We are being asked to do something that is not possible. If you are running a stake pool and someone delegates to you nothing in the protocol has any notion of KYC there. So then how does a state pool operator report to the IRS on some form who that person delegated to them is, it is a pseudonymous transaction, it’s just not in the protocol”.
“Unless the suggestion is that if you are a minor in a proof of work system contributing has rate with an ASIC at home to a mining pool that’s fine okay no registration. But in a proof of state system, 100 of the users of the system have to be KYC before they can delegate. This is madness” said Charles Hoskinson. I don’t understand what it means for wallet software, I don’t understand what it means for the Defi application, look at everything in Ethereum, Defi, chain-link all these things any of those components may have a KYC component” he added.
“We are led by people in their 70, 80s, and even 90s who don’t know how the world works, how the internet and smartphones work” he said.
“90% of businesses, institutional investors, and politicians don’t understand cryptocurrencies. It is new to them, said Michael Saylor.
“For a Proof of State system to survive technologies will need to be implemented in the protocol so that the government can track and trace every transaction if they wish to” – Win Investing
Cryptocurrencies regulations could be a knee-jerk reaction that typically occurs when bringing a brand-new innovative technology into a legacy system
The elites in this system are concerned that the new technology could disrupt the status quo. The State survives by taxing its people, and it is parasitic by nature. So, if these cryptocurrencies regulations are self-preserving moves by regulators, then we see no change irrespective of the amount of lobbying by wealthy cryptocurrency players.
For a Proof of State system to survive technologies will need to be implemented in the protocol so that the government can track and trace every transaction if they wish to.
State Capitalism, where the government chooses the winners and losers in all about surveillance, monitoring, and taxing. Put simply, State Capitalism means a big state, in other words, less freedom and more taxes. State Capitalism’s Universal Basic Income (UBI) will ensure people have a bed and a bowl of soup. UBI is opium for the neo surfs that will keep the masses from uprising. Ballooning wealth tax, inheritance tax, income tax will complete the wealth transfer from the middle, wealth to the State.
The new thought police, what is known today as social media, will control the narrative.
“under a State Capitalist system, only the Nomenklatura, those ideologically affiliated with the neo-communist state, will be allowed to live well” – Win Investing
Under a State Capitalist system, only the Nomenklatura, those ideologically affiliated with the neo-communist state, will be allowed to live well.
The breadlines of the soviet union did not exist for the communist party members who would shop at stores full of luxury western goods, French champaign, and perfume.
But for the rest, they will own nothing and be happy.
Our greatest fear is that cryptocurrencies regulations are no mistake and that it further underscores my view that we are being shepherded into a totalitarian state system
Think about it. The global lockdown of people, business, the curfews, social distancing, fear masks, forced vaccinations for a virus that kills fewer people than tobacco smoking every year.
What is the real agenda?
We are short totalitarianism and long freedom. When the suppressed, persecuted, and poor fled Europe with not much more than the shirt on their back to immigrate to the US as free people, they not only built a country, they built a superpower. When you let free people dream, it spurs innovation and wealth.
Congress is in recess until September. We see no amendments to the cryptocurrencies regulations, Bill, until then. So, we envisage volatility in cryptocurrencies over the summer.