Except NY already figured that part out. In fact, they recently presented their regulatory framework for public review. It involves shutting down Bitcoin as we know it, and replacing it with something in which
- every single wallet provider, including makers of open source wallets like Bitcoin-QT, in addition to Bitcoin exchanges and banks, are legally considered "Virtual Currency Businesses"
- each customer of a "Virtual Currency Business" must have a verified physical address and government issued photo ID on file in order to use Bitcoin
- each "Virtual Currency Business" must file suspicious activity reports on all transactions valued at over $3000 USD, meaning open source software like Bitcoin-QT must know each of its users at all times
- each "Virtual Currency Business" must retain records for no less than 10 years
- each "Virtual Currency Business" must maintain collateral in the form of USD including collateral for total Bitcoin balances
- each would-be creator of a cryptocurrency must register with the State before releasing 1 SLOC
The reason it's easy to transfer Bitcoin across long distances is that the system works without intermediaries. Regulation, as outlined by NY, involves polluting the Bitcoin protocol with precisely the same intermediaries that make the traditional banking system so awful.
> It will be a good thing when governments figure out how to regulate it
In other words, you believe it's a good idea to castrate Bitcoin and make it no different than PayPal, SWIFT, ACH, etc.
Points taken! That does sound awful. I want to have my cake and eat it too. I want regulations, but "good" ones, where "good" is defined in some vague and totally subjective way.
- every single wallet provider, including makers of open source wallets like Bitcoin-QT, in addition to Bitcoin exchanges and banks, are legally considered "Virtual Currency Businesses"
- each customer of a "Virtual Currency Business" must have a verified physical address and government issued photo ID on file in order to use Bitcoin
- each "Virtual Currency Business" must file suspicious activity reports on all transactions valued at over $3000 USD, meaning open source software like Bitcoin-QT must know each of its users at all times
- each "Virtual Currency Business" must retain records for no less than 10 years
- each "Virtual Currency Business" must maintain collateral in the form of USD including collateral for total Bitcoin balances
- each would-be creator of a cryptocurrency must register with the State before releasing 1 SLOC
The reason it's easy to transfer Bitcoin across long distances is that the system works without intermediaries. Regulation, as outlined by NY, involves polluting the Bitcoin protocol with precisely the same intermediaries that make the traditional banking system so awful.
> It will be a good thing when governments figure out how to regulate it
In other words, you believe it's a good idea to castrate Bitcoin and make it no different than PayPal, SWIFT, ACH, etc.