3 (Amash, Duncan, Massie)

2 (Paul, Sanders)

Apparently the only 5 in congress who are pro-American enough to support free market capitalism and, the land of the free, and the home of the brave.

Even Bernie Sanders is more pro free-market capitalism, than most of congress!

I still maintain, Nolu, that the reach of laws is only so far as enforcement is possible. Where enforcement is not possible, laws are of no consequence, and that is true no matter what any court, even the USSC, may say to the contrary. That's not an attempt at a legal statement on my part, it's simply an observation of practicality. Whatever laws might be made prohibiting one form of cryptocurrency, digital innovation can simply evolve to circumvent them. While it is possible to find cash in a suitcase, or funds in a bank account, dogs cannot sniff out cryptocurrency on the internet. It can be hidden and disguised a billion different ways. That's true not because I want it to be true, it's simply reality.

And technology is progressing to the point where cryptocurrency is becoming a reality. Just the other day I was paid a small amount of bitcoin. It wasn't the first choice of payment method, but my client in India told me regulations there made more conventional payments either expensive or troublesome (I'm not sure which but didn't press the issue), and a secondary service we tried didn't work for me due to an inability to complete an ID verification that was demanded (due to technical troubles, and their support center has yet to get back to me).

So what worked? Bitcoin worked. Bitcoin came through with no hassles, for both my client and me. And the cost of the xfer was no where near what any banking service would charge -- though to buy bitcoin with USD does cost about 10-20% above spot.

In the same way that the internet killed off the Blockbuster movie rental chain, is killing traditional newspapers and magazines, and reforming the retail world, a day of reckoning is coming for the banking industry, and the political landscape as well. Because of the exponential progress of technology, the next 50 years will be mind boggling. Much of it will be good, some of it bad.

You want less legislation, have less politicians

Misterwhite's naive enough to think that we can petition the same politicians who are bribed to create laws, to repeal them.

I say, just ignore stupid laws and the stupid politicians who create them. We've got tens of thousands of useless laws crying out to be ignored, plus lives to live.
In 1,000 lifetimes they won't be repealed, so just say NO while promoting jury nullification so we can say NO in the courtrooms of the land as well.

Misterwhite's naive enough to think that we can petition the same politicians who are bribed to create laws, to repeal them.

We have the power to vote them out of office. Or in. Hillary outspent Trump 2:1 and still lost.

"In 1,000 lifetimes they won't be repealed

Then the people must want those laws.

What happened to the law that would stop all subversives within congress and their lobbyists?

Who do you expect to write and pass a law to rein in congresscritters?

I say, just ignore stupid laws and the stupid politicians who create them.

You do so at your own peril. You can do 60 in a 40 all day, every day, but soon you would not be driving.

It seems there is nothing here particularly devastating to crypytocurrency. It's not even explicitly referenced, and certainly not declared illegal.

This is certainly an oversight error.

Under "Subtitle C—Combating Terrorism and Illicit Financing," section 262, paragraph 8, one finds, boldfaced in the thread article above,

(8) TREND ANALYSIS OF EMERGING ILLICIT FINANCE THREATS.—A discussion of and data regarding trends in illicit finance, including evolving forms of value transfer such as so-called cryptocurrencies, other methods that are computer, telecommunications, or Internet-based, cyber crime, or any other threats that the Secretary may choose to identify.

That is not a reference but an explicit inclusion of cryptocurrencies as an emerging illicit finance threat.

It's simply an expansion of the definition, by changing coins and currency to "funds".

No, it is including cryptocurrency as an illicit finance threat and changing transaction reporting requirements to include any form of funds, and not just coins or currency or monetary instruments. There can be no doubt of the intent to include, and the actual inclusion, of cryptocurrencies within the law.

http://law.justia.com/codes/us/2015/title-31/subtitle-iv/chapter-53/subchapter-ii/sec.-5326/

http://statecodesfiles.justia.com/us/2015/title-31/subtitle-iv/chapter-53/subchapter-ii/sec.-5326/sec.-5326.pdf

Below is the effect of just the amendments to 31 U.S.C. 5326 regarding records and reporting. The deletions are indicated by strikeout and the additions are in boldface blue font.

2015 US Code
Title 31 - Money and Finance (Sections 101 - 9705)
Subtitle IV - Money (Sections 5101 - 5367)
Chapter 53 - Monetary Transactions (Sections 5301 - 5367)
Subchapter II - Records and Reports on Monetary Instruments Transactions (Sections 5311 - 5332)
Sec. 5326 - Records of certain domestic coin and currency transactions

31 U.S.C. § 5326 (2015)

§5326. Records of certain domestic coin and currency transactions

(a) In General.—If the Secretary of the Treasury finds, upon the Secretary's own initiative or at the request of an appropriate Federal or State law enforcement official, that reasonable grounds exist for concluding that additional recordkeeping and reporting requirements are necessary to carry out the purposes of this subtitle and subtitle or to prevent evasions thereof, the Secretary may issue an order requiring any domestic financial institution or nonfinancial trade or business or group of domestic financial institutions or nonfinancial trades or businesses in a geographic area—

(1) to obtain such information as the Secretary may describe in such order concerning—

(A) any transaction in which such financial institution or nonfinancial trade or business is involved for the payment, receipt, or transfer of United States coins or currency (or such other monetary instruments funds as the Secretary may describe in such order), the total amounts or denominations of which are equal to or greater than an amount which the Secretary may prescribe; and

(B) any other person participating in such transaction;

(2) to maintain a record of such information for such period of time as the Secretary may require; and

(3) to file a report with respect to any transaction described in paragraph (1)(A) in the manner and to the extent specified in the order.

(b) Authority To Order Depository Institutions To Obtain Reports From Customers.—

(1) In general.—The Secretary of the Treasury may, by regulation or order, require any depository institution (as defined in section 3(c) of the Federal Deposit Insurance Act)—

(A) to request any financial institution or nonfinancial trade or business (other than a depository institution) which engages in any reportable transaction with the depository institution to provide the depository institution with a copy of any report filed by the financial institution or nonfinancial trade or business under this subtitle with respect to any prior transaction (between such financial institution or nonfinancial trade or business and any other person) which involved any portion of the coins or currency (or monetary instruments) funds which are involved in the reportable transaction with the depository institution; and

(B) if no copy of any report described in subparagraph (A) is received by the depository institution in connection with any reportable transaction to which such subparagraph applies, to submit (in addition to any report required under this subtitle with respect to the reportable transaction) a written notice to the Secretary that the financial institution or nonfinancial trade or business failed to provide any copy of such report.

(2) Reportable transaction defined.—For purposes of this subsection, the term "reportable transaction" means any transaction involving coins or currency (or such other monetary instruments as the Secretary may describe in the regulation or order) funds (as the Secretary may describe in such regulation or order) the total amounts or denominations of which are equal to or greater than an amount which the Secretary may prescribe.

(c) Nondisclosure of Orders.—No financial institution or nonfinancial trade or business or officer, director, employee or agent of a financial institution or nonfinancial trade or business subject to an order under this section may disclose the existence of, or terms of, the order to any person except as prescribed by the Secretary.

(d) Maximum Effective Period for Order.—No order issued under subsection (a) shall be effective for more than 180 days unless renewed pursuant to the requirements of subsection (a).

(Added Pub. L. 100–690, title VI, §6185(c), Nov. 18, 1988, 102 Stat. 4355; amended Pub. L. 102–550, title XV, §§1514, 1562, Oct. 28, 1992, 106 Stat. 4058, 4072; Pub. L. 107–56, title III, §§353(d), 365(c)(2)(B), Oct. 26, 2001, 115 Stat. 323, 335.)

REFERENCES IN TEXT

Section 3(c) of the Federal Deposit Insurance Act, referred to in subsec. (b)(1), is classified to section 1813(c) of Title 12, Banks and Banking.

AMENDMENTS

2001—Subsec.(a). Pub. L. 107–56, §365(c)(2)(B), inserted "or nonfinancial trade or business" after "financial institution" and "or nonfinancial trades or businesses" for "financial institutions" in introductory provisions.

Subsec. (a)(1)(A). Pub. L. 107–56, §365(c)(2)(B)(i), inserted "or nonfinancial trade or business" after "financial institution".

Subsec. (b)(1)(A). Pub. L. 107–56, §365(c)(2)(B)(i), inserted "or nonfinancial trade or business" after "financial institution" wherever appearing.

Subsec. (b)(1)(B). Pub. L. 107–56, §365(c)(2)(B)(i), inserted "or nonfinancial trade or business" after "financial institution".

Subsec. (c). Pub. L. 107–56, §365(c)(2)(B)(i), inserted "or nonfinancial trade or business" after "financial institution" in two places.

Subsec. (d). Pub. L. 107–56, §353(d), substituted "more than 180 days" for "more than 60 days".

1992—Subsecs. (b) to (d). Pub. L. 102–550 added subsecs. (b) and (c) and redesignated former subsec. (b) as (d).

- - - - - - - - - - - - - - - - - - - -

I still maintain, Nolu, that the reach of laws is only so far as enforcement is possible. Where enforcement is not possible, laws are of no consequence, and that is true no matter what any court, even the USSC, may say to the contrary.

The law on illicit financing now explicitly reaches cryptocurrencies. All transactions of funds, including cryptocurrencies, are subject to record and reporting requirements. This is just an opening salvo.

This is included within a bill for combatting terrorism, much as was done with the USA PATRIOT Act.

When the government decides to crush something, the arms of the law are long indeed. Ask Kim Dotcom how his former business is doing. Marcel Lazar Lehel+, a/k/a Guccifer is in prison. Neither was in the United States. Ross Ulbricht, a/k/a Dead Pirate Roberts, is doing life without possibility of parole. Who will open the next Silk Road on the dark web?

An example accurate but bogus argument regarding the legal system is that if every criminal defendant refused to plea bargain and demanded trial by jury, the system would collapse. It is so obvious, one wonders why it is not done. All that is needed is enough volunteers to join Dead Pirate Roberts.

Currently, Kodi on Android boxes is being assailed. The government need not prosecute every individual. It has gone after and shut down various distributors.

Cryptocurrencies, such as Bitcoin, are reliant on the internet for operation. The government can do as it pleases with the internet. The government can make cryptocurrency so unreliable, and such a pain to use, that it will be unsustainable as a popular currency. At the same time, if desired, the government can introduce an easy to use digital currency, such as credit and debit cards.

Whatever laws might be made prohibiting one form of cryptocurrency, digital innovation can simply evolve to circumvent them. While it is possible to find cash in a suitcase, or funds in a bank account, dogs cannot sniff out cryptocurrency on the internet. It can be hidden and disguised a billion different ways. That's true not because I want it to be true, it's simply reality.

The transactions on the government controlled internet are not hidden.

Underestimate the raw power of the government at your own peril.

And technology is progressing to the point where cryptocurrency is becoming a reality.

The government will always be able to have better technology than purveyors of bitcoin. If they turn the NSA and Cybercommand loose on Bitcoin, it would not be pretty.

You do so at your own peril. You can do 60 in a 40 all day, every day, but soon you would not be driving.

Then I assume you've studied and memorized tens of thousands of laws and scrupulously obey at all times?

I say, just ignore stupid laws and the stupid politicians who create them.

You do so at your own peril. You can do 60 in a 40 all day, every day, but soon you would not be driving.

Then I assume you've studied and memorized tens of thousands of laws and scrupulously obey at all times?

You are the one who said you just ignore stupid laws. You are the one who inferred that you have studied tens of thousands of laws, determined which you feel are stupid, and you just ignore them.

I merely pointed out that you do so at your peril. Laws do not become unenforceable because you consider them stupid, or even if they really are stupid.

Bullshit. Does this sound at all rational to YOU?

I've violated the law every single day since July 1 that I've been in my car; starting/pausing podcast playback mostly. I don't text while driving; that's as dumb as a democRat, but no way in hell I give a shit about this STUPID law - one of many thousands of unthinking laws.

This one is the bastard child of the insurance business, which bribed politicians to pass it without considering the real world. So we will ignore it.
Feel free to be unthinking sheeple if you wish; for many of us, we're allergic to subjugation.

My state just created another stupid law July 1 - you can't even TOUCH your cellphone while driving, for any reason, even sitting stopped in traffic or at a red light.

It's overkill. Most speed limits seem low to me. However, violation of the law is done at your peril and may have consequences.

However, violation of the law is done at your peril and may have consequences.

Yeah, well, so did the Declaration of Independence. This is the micro-level, where it starts, like a 3-cent tax on tea. Maybe we'll build to a new declaration, but meanwhile I'm not planning to screw up daily life to comply with people who could only get government jobs.

Once people stopped caring what Big Stupid Government 'thought' about marijuana, the legalization movement really caught fire - let's hope similar inclinations toward liberty appear quickly elsewhere.

Once people stopped caring what Big Stupid Government 'thought' about marijuana, the legalization movement really caught fire

And the fact is that pot is still illegal, you can still go to prison for it, and obtaining a state license for pot makes one ineligible to buy or own a gun per the federal government. There are always a chosen few who hit the jackpot, but that is their chosen risk.

Who do you expect to write and pass a law to rein in congresscritters?

The ones that won't sign on are part of the insidious CPUSA-Muslim Brotherhood conspiracy! If it won't pass then it's long past the point where this evil government must be collapsed.

The ones that won't sign on are part of the insidious CPUSA-Muslim Brotherhood conspiracy!

The ones that won't sign on are the ones getting rich in congress. That is most of them.

This is certainly an oversight error.

Under "Subtitle C—Combating Terrorism and Illicit Financing," section 262, >paragraph 8, one finds, boldfaced in the thread article above,

(8) TREND ANALYSIS OF EMERGING ILLICIT FINANCE THREATS.—A discussion of and data regarding trends in illicit finance, including evolving forms of value transfer such as so-called cryptocurrencies, other methods that are computer, telecommunications, or Internet-based, cyber crime, or any other threats that the Secretary may choose to identify.

That is not a reference but an explicit inclusion of cryptocurrencies as an emerging illicit finance threat.

I stand corrected. I think I did note that in passing, but also noted the passage is rather odd in that it does not prohibit anything. I'm used to reading statutes that obligate, prohibit or perhaps permit certain entities to do certain things. And so this passage is odd in that it begins with "A discussion". I proceeded to read further expecting to see a subsequent reference, but found none, and posted errantly.

When the government decides to crush something, the arms of the law are long indeed. Ask Kim Dotcom how his former business is doing. Marcel Lazar Lehel+, a/k/a Guccifer is in prison. Neither was in the United States. Ross Ulbricht, a/k/a Dead Pirate Roberts, is doing life without possibility of parole. Who will open the next Silk Road on the dark web?

Well, that would explain drugs such as heroin, LSD, cocaine, crack & marijuana cannot be purchased US. They are illegal.

(!)

Smuggling has existed since the first prohibitive edict was declared by some ancient king, and history has proven that market forces trump such laws. And if the US government can't even shut down drug smuggling that involves hard cash and physical contraband, how do they expect to shut down a cryptocurrency?

It doesn't surprise me in the least that the US gov would take a hostile view of cryptocurrency. They rightly view it as a threat to the power of government to monitor, control and tax. But that doesn't mean it's something government has a moral right to do.

Cryptocurrencies, such as Bitcoin, are reliant on the internet for operation. The government can do as it pleases with the internet. The government can make cryptocurrency so unreliable, and such a pain to use, that it will be unsustainable as a popular currency.

I guess here we disagree on a fundamental question of fact, on whether or not the gov can "do as it pleases with the internet". You say it can, I say it cannot. Private coders and hackers will always have the lead on gov hired professionals. At best (for you) it could turn into a cat and mouse game where the gov puts up one wall and the private developers code around it, then get hit by another wall and so one. But as the technology growth curve accelerates upward, I am confident that it's a game the mice will eventually win.

At the same time, if desired, the government can introduce an easy to use digital currency, such as credit and debit cards.

Of course they could. And they probably will, and in fact likely out of lack of any choice. And as use of digital money becomes popular and people become more accustomed to using their smart phones to make purchases, the use of bitcoin alongside official digital currency will be a much smaller leap than it is today.

And given the nature of block-chain based currency, I think outlawing it will be very problematic, not only practically but perhaps legally as well.

But time will tell, and perhaps we'll live long enough to see.

I'm used to reading statutes that obligate, prohibit or perhaps permit certain entities to do certain things. And so this passage is odd in that it begins with "A discussion".

It is an initial move and somewhat difficult to read by itself and glean its significance. It amends other provisions. It redefines what other provisions cover, making them applicable to any funds transfer, and specifically applicable to crytpocurrency.

The USA Patriot Act, read by itself, is largely a mystery.

They have made recordkeeping of all fund transfers mandatory at whatever value the Secretary may designate.

It lumps in cryptocurrencies with illicit finance threats under, "evolving forms of value transfer such as so-called cryptocurrencies." In and of itself, it does nothing drastic, but it paves the way for significant change with a directive from the Secretary.

Smuggling has existed since the first prohibitive edict was declared by some ancient king, and history has proven that market forces trump such laws. And if the US government can't even shut down drug smuggling that involves hard cash and physical contraband, how do they expect to shut down a cryptocurrency?

They might choose to stop if they just didn't make so much damn money off of it. They have financed wars with it.

It doesn't surprise me in the least that the US gov would take a hostile view of cryptocurrency. They rightly view it as a threat to the power of government to monitor, control and tax. But that doesn't mean it's something government has a moral right to do.

Nobody has ever questioned the government's morals. Nobody has found them yet. When the government chooses to employ raw power as a weapon, morality is consigned to Al Gore's lockbox.

I guess here we disagree on a fundamental question of fact, on whether or not the gov can "do as it pleases with the internet". You say it can, I say it cannot.

The government does not need to control the hackers. It only needs to control the providers at the top of the food chain. Each is a corporation and none is in hiding. China and others shut out parts of the internet. A government can control such comms in and out.

If you were a Bitcoin millionaire or billionaire and the government issued you an order prohibiting you from accessing the internet or using a computer, you would risk going to prison or be unable to pay for breakfast tomorrow.

The way the bill reads, I suspect that at some future date, if/when they choose to act, they will simply declare that Bitcoin traffics in terrorist financing and declare that engaging in any transfer of funds via Bitcoin renders one prosecutable under the provisions of some terrorist law.

It is hard to get people to invest in a business that creates criminal culpability when the same service is available elsewhere.

To screw up Bitcoin, the government need only engineer intermittent nonavailability, or make it a hassle. At some point, you have to convert it to something you can actually spend. If Bitcoin transactions are deemed illicit, it will be difficult to find corporations willing to have anything to do with it.

Think of people hiding a million dollars under their mattress who have not paid income tax lately. The government does not know whose mattress is loaded. They do not need to. They create new technicolor bills and declare that all old bills will need to be traded for the new bills by a date certain, after which the old bills will no longer be legal currency, i.e. they will be worth nothing. So you have to trade in your million dollars. If you go to the bank, you might have some splainin to do with the IRS.

Private coders and hackers will always have the lead on gov hired professionals.

Never underestimate the power of stupid people in large numbers with the government behind them. You can break the law every day with a 99% success rate at beating the system, start in January and wind up in jail sometime in April. That is their advantage. They just have to persist until you are less than perfect.

Remember when the mob ran the numbers racket? That was terrible, so the government shut those racketeers down. Now the government runs the numbers racket and pays less than the mob did. For the children. Or education.

At best (for you) it could turn into a cat and mouse game where the gov puts up one wall and the private developers code around it, then get hit by another wall and so one.

You need a circuit to communicate on, you need anonymity, and you need to be able to have businesses willing to accept your cryptocurrency after it is declared illegal to do so. While it is legal, they can weight it down in reporting requirements.

I'm betting that Bitcoin will not put the Treasury Department out of business any time soon.

The only way we will know is to wait and watch. I seriously doubt I will live long enough to find out.

I guess here we disagree on a fundamental question of fact, on whether or not the gov can "do as it pleases with the internet". You say it can, I say it cannot.

The government does not need to control the hackers. It only needs to control the providers at the top of the food chain. Each is a corporation and none is in hiding. China and others shut out parts of the internet. A government can control such comms in and out.

Certainly the gov could, in theory, force internet providers to cut off service completely, and yes that would put a damper on bitcoin. And all told, the gov cannot in reality do that as there is too much economics that depend upon it, and the gov is far too dependent upon the net to take such a step. It's more than infeasible. They cannot do it at all. These days car registration renewals are often handled in part oven the net, as are a myriad of other bureaucrat tasks. Shutting down the internet solely to block bitcoin transactions is not a step the US gov has as an option. At best they could try to selectively block specific net traffic related to bitcoin, but bitcoin advocates could & would modify such traffic to adjust. Ultimately, it will not possible to discern bitcoin encrypted traffic from other forms of encrypted traffic, assuming it's even possible now, which it may not be.

If you were a Bitcoin millionaire or billionaire and the government issued you an order prohibiting you from accessing the internet or using a computer, you would risk going to prison or be unable to pay for breakfast tomorrow.

Unless you have a trusted friend or family member living next door, or out of state or out of country for that matter, make your bitcoin purchases for you.

The way the bill reads, I suspect that at some future date, if/when they choose to act, they will simply declare that Bitcoin traffics in terrorist financing and declare that engaging in any transfer of funds via Bitcoin renders one prosecutable under the provisions of some terrorist law.

Would such a law apply outside the USA? Would it apply to non-US citizens? What if bitcoin advocates responded with a two-tiered system, where one would not trade bitcoin directly, but instead trade something else that represents bitcoin in a foreign jurisdiction?

To screw up Bitcoin, the government need only engineer intermittent nonavailability, or make it a hassle. At some point, you have to convert it to something you can actually spend. If Bitcoin transactions are deemed illicit, it will be difficult to find corporations willing to have anything to do with it.

Right now, the US gov is already making above-board transactions a hassle with ID verification and KYC stuff, which is what is spurring cryptocurrency popularity. And one need not find lots of businesses that will accept bit coin. Only one.

https://wirexapp.com/bitcoin-debit-card.html

Spend bitcoin everywhere with the world's most popular bitcoin card. Your bitcoin debit card works anywhere people take VISA and Mastercard, no 'Bitcoin Accepted' sign needed. Load money instantly via desktop or smartphone app.

They offer a visa/mastercard debit card where your account is held in bitcoin. When you make a purchase, whether in-store or on the net, they deduct bitcoin from your account according to the current exchange rate, and authorize the purchase in whatever currency is in question. To block this, the gov would need to close down the outfit which resides in a foreign jurisdiction. And repeat for any other similar outfits in other jurisdictions that would arise.

Bitcoin is now starting to be available for foreign exchange trading:

https://www.fxopen.com/en/trading-accounts/crypto-bitcoin-account/

FXOpen’s novel offering lets you trade Bitcoin, Litecoin, Ethereum, Namecoin and Peercoin against USD, EUR or RUB in a true ECN environment!

Bitcoin, Litecoin, Namecoin and Peercoin proved to have great potential for investment and speculation, due to their high volatility and dramatic price moves.

Unlike other brokers, who attempt cryptocurrency trading in the form of CFDs of binary options, FXOpen lets you trade Bitcoin, Namecoin, Litecoin and Peercoin directly against the US Dollar, Euro or Russian Ruble. We use xBTCe, one of the top online cryptocurrency exchanges, as our liquidity provider. Our order execution is based on the ECN Aggregator – FXOpen's proprietary technology with proven excellent performance over several years.

This is happening with many forex brokerages, and they all have to offer it if they wish to stay competitive with each other.

Bitcoin, and cryptocurrency in general, is making it to the mainstream as a legitimate form of money. If the gov wants to kill it, they have a very formidable task before them. While, yes, the US gov is quite powerful, I don't think they have a snowball's chance in hell of stopping this.

Certainly the gov could, in theory, force internet providers to cut off service completely, and yes that would put a damper on bitcoin. And all told, the gov cannot in reality do that as there is too much economics that depend upon it, and the gov is far too dependent upon the net to take such a step.

The government can control use use of dot accounts. They could require all companies and businesses conduct internet fund transactions only with a specific address such as dot biz. They can require a registration for a company/business to obtain a dot biz account, and prohibit Bitcoin transactions.

If simple transactions are not readily available, it would prevent Bitcoin from popular adoption as a primary working currency for everyday life. They do not have to seek it out and eradicate it, they just have to make it a pain in the ass to use.

I don't underestimate a government that made booze illegal for a decade. They had an unconstitutional, unapportioned income tax under Lincoln and for about thirty years. Lincoln somehow "authorized" a military general to suspend habeas corpus, and to delegate the authority down the chain of command to others. We have recently had enhanced interrogation techniques and extraordinary rendition. That would be sort of grabbing someone off the street, transporting them to some country or other, dumping them in a black prison, and torturing them. And redefining torture as something that causes organ failure or death. So, if I were to stick a knitting needle through your liver, and it failed to cause organ failure or death, that would not be torture, or so the definition said.

What they will do depends on what threat is perceived. The suggestion is that cryptocurrency is a threat to the monetary system of the nation. Even if it has a noble purpose, the powers that be are not going to like Bitcoin.

Would such a law apply outside the USA? Would it apply to non-US citizens? What if bitcoin advocates responded with a two-tiered system, where one would not trade bitcoin directly, but instead trade something else that represents bitcoin in a foreign jurisdiction?

I am primarily speaking to Bitcoin (or other cryptocurrency) in the U.S., but Kim Dotcom can attest to the fact that having no personal or corporate presence in the U.S. does not get around the long reach of the U.S. government.

Unless you have a trusted friend or family member living next door, or out of state or out of country for that matter, make your bitcoin purchases for you.

[...]

Spend bitcoin everywhere with the world's most popular bitcoin card. Your bitcoin debit card works anywhere people take VISA and Mastercard, no 'Bitcoin Accepted' sign needed. Load money instantly via desktop or smartphone app.

The U.S. can declare all Bitcoin transaction as illicit and no credit card or debit card transactions would be made.

Corporations are given life by the government. It can make trading in Bitcoin a corporate death sentence. The government can revoke the corporate license.

For individuals, they can use civil asset forfeiture. You get caught in a bitcoin transaction and they can seize your house, car, and all your goodies. Quite simply, they can be assholes when they want to be.

When you make a purchase, whether in-store or on the net, they deduct bitcoin from your account according to the current exchange rate, and authorize the purchase in whatever currency is in question. To block this, the gov would need to close down the outfit which resides in a foreign jurisdiction. And repeat for any other similar outfits in other jurisdictions that would arise.

Where there's a will, there's a way.

Where Bitcoin transactions are declared illicit, no banklike corporation will touch it.

Megaupload was seized. They simply took the domain name. They froze assets. Kim Dotcom, in New Zealand, used to have a company. The U.S. legal system has acted outside the territorial jurisdiction of the U.S. for some time now. I'm not approving, just observing the fact. They kidnapped someone off the street in Italy, without Italian consent, and delivered the subject to another country under extraordinary rendition. As a legal concept, that is bullshit, but they did it.

Fighting the Feds is like fighting the Terminator. They keep on coming and have no particular moral restraint. Winning is not often an option. Surviving is sort of the substitute for victory.

Bitcoin, Litecoin, Namecoin and Peercoin proved to have great potential for investment and speculation, due to their high volatility and dramatic price moves.

They would, indeed, have great potential for investment and speculation. However, a volitile currency, going up or down 10 to 20 per cent per day is anethma to business. It does not function well as a working currency. Business needs stability and predictability.

Bitcoin, and cryptocurrency in general, is making it to the mainstream as a legitimate form of money. If the gov wants to kill it, they have a very formidable task before them. While, yes, the US gov is quite powerful, I don't think they have a snowball's chance in hell of stopping this.

It is difficult to maintain that it has become a legitimate form of money in the United States.

By law,

(8) TREND ANALYSIS OF EMERGING ILLICIT FINANCE THREATS.—A discussion of and data regarding trends in illicit finance, including evolving forms of value transfer such as so-called cryptocurrencies, other methods that are computer, telecommunications, or Internet-based, cyber crime, or any other threats that the Secretary may choose to identify.

Cryptocurrency has dipped its toe in the water. The government is a pitbull that has bared its teeth in warning.

Other nations who desire to keep control of their own currency will join with the United States in crushing Bitcoin and other cryptocurrency if they get too threatening.