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"I am content to allow the (current) government know what I have."

Dude, that is crazy.

Are you trying to live like a good man or like a good slave?

If you hide your money from the government and then spend it, if they catch you they throw you in prison. I would prefer to remain out of such situations.

Would I prefer to keep my wealth secret from the government and pay no taxes? Sure. But I can't do much for my family if incarcerated.

It's one thing if you've got no money and you save what scraps you have privately. But I am not in that situation. I have enough wealth to be buying properties and businesses. That game ends if I commit tax fraud and end up in prison.

Tax fraud is no joke, and anyone with substantial wealth that I've never met pays their taxes.

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Discussion

Mark Camper 1y ago

You can still buy and sell bitcoin privately and pay taxes if you want to. That's reasonable.

Anonymity is not just for the tax avoidance. It gives you more optionality and safety.

Perfectly surveiled bitcoin by the governments is "permissioned 3rd party money". It's not a Bitcoin anymore.

BitcoinStu 1y ago

Buying and selling bitcoin privately can constitute money laundering. There are many examples of people going to prison for buying bitcoin privately p2p. There have been many FBI stings that imprisoned people for showing up to a Starbucks to buy some Bitcoin. It's happened many times and that's a risk I'm not interested in.

Mark Camper 1y ago

I think you're mixing things. If the user doesn't report cap gains, it's possible.

But the act of buying and selling crypto by itself via non-KYC paths is absolutely not a crime.

The user doesn't have any legal responsobility for verifying whether his counterpart is compliant with all the regulations or not.

BitcoinStu 1y ago

buying and selling bitcoin p2p is absolutely a crime and many people have been imprisoned for it. Perhaps you are not aware of the history regarding this subject but I assure you that many have suffered from trying this path.

BitcoinStu 1y ago

as a result all my bitcoin is purchased through US based KYC exchanges and every transaction I make is reported to the IRS. If you are doing anything differently then you are taking far more risk than I would.

Best of luck. And I mean that.

BitcoinStu 1y ago

and if you don't believe me, google some of the following:

Michael Lord

Joseph Seibert

Aaron Shamo

Local Bitcoins

There is a long history of people being imprisoned for charges like "illegal money transmission, money laundering, violations of the BSA", and so on.

It's just not my game. The IRS knows how much Bitcoin I have. And after January 1st 2025 if they don't know yours, then you are in violation of US tax law and can face penalties, interest, and prosecution.

But if you want a pile of Bitcoin the government doesn't know about, go for it. I hear a lot of new-commers to bitcoin talking like that "I lost my bitcoin in a boating accident". Yeah, the Judge is going to love that.

If the state comes after you, your non-KYC bitcoin won't help you. And in fact, having a big stack of non-KYC bitcoin makes you a target.

Best of luck

BitcoinStu 1y ago

The bottom line for me is that I have determined that full disclosure is the safest solution for me and my family. Fuck with the government at your own peril.

Mark Camper 1y ago

That is fair.

I don't mean to scream and shout. It just comes across that way in notes.

I just see strong and potentially scary tradeoffs in being transparently open with the governments about all your transactions. The commies have looted my family once. I owe it to them to not sleepwalk into the same trap ever again.

BitcoinStu 1y ago

Hey I don't blame you. There is no love lost between me and the state. And let me say that a small stack of non-kyc bitcoin that the government doesn't know about might be a worthwhile venture. But I am not a small holder and putting generational wealth outside their view is really fucking dangerous.

For example, I am planning to buy some property next year. If all my bitcoin was acquired without KYC then not only would I be unable to show a cost-basis to the IRS, and therefore be subject to a 0-basis taxation event (costing me 10's of thousands of dollars, or more) but it would also trigger a bunch of red flags with several government agencies that I would prefer not become interested in where I got my Bitcoin.

Mark Camper 1y ago

Makes sense.

It's just not really the maximum vision that I see in the Bitcoin project.

BitcoinStu 1y ago

Don't mistake your fantasies about the future for the reality of you and your family's situation in the present.

If Bitcoin does what we all hope, it will do it without me having non-kyc bitcoin. I am not going to endanger my family just for some idealistic idea about the state not having the right to fuck me.