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Bitcoin can be banned if deemed a tax burden, claims developer

Prashant Jha

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Bitcoin was created right after the financial crisis of 2008, conceptualized as an alternative to the existing centralized model which had failed the world several times over the years by keeping power concentrated in the hands of governments. In order for the ‘difficult to manipulate’ Bitcoin to succeed, it needs to find mainstream adoption, and that mainstream adoption goes through regulators and governments, which is why a small government is still a far-fetched dream.

Eric Voskuil, a leading developer and prominent Bitcoiner, recently appeared on ‘What Bitcoin Did‘ to discuss the role of Bitcoin in the future economy. Voskuil contradicted the theory that Bitcoin would eventually lead to an economy that will take away the taxation authority from the hands of the government. Voskuil explained that Bitcoin adoption has to go through rigorous regulations and if it becomes a tax burden on governments, they can simply label it as illegal.

“If you remove all the various forms of taxation on money, you could, you could do what Bitcoin does without all the costs of Bitcoin, but you can’t. And the first and most obvious act, if it becomes significant enough for it to be a tax drain on the status or state, they would say it’s money laundering, it’s illegal.”

Voskuil asserted that the most popular entities garner the highest taxes and that governments tend to follow that as they know that simply banning it won’t help. This philosophy is quite evident in Bitcoin’s case as in the beginning, governments and financial institutions sidelined it and claimed it was a bubble. However, when Bitcoin kept rising in value when many predicted its demise, the same authorities realized that it cannot be sidelined or neglected.

As of now, Bitcoin has been regulated in countries like the USA, Canada, Australia, Japan, S.Korea, and the European Union, with the number of adopters only on the rise. A few nations are still skeptical of it, but so were many others who have decided to go back on their decision. Bitcoin can act as a parallel monetary system, but not necessarily an independent or only one.

A Computer Science graduate, Prashant focuses on UK and Indian markets. With over two years of experience as a crypto-journalist, his interests lie in blockchain technology adoption across emerging economies.