BitShares Forum

Main => General Discussion => Topic started by: clout on January 28, 2014, 01:50:31 am

Title: Legality of Prediction Markets and Dacs
Post by: clout on January 28, 2014, 01:50:31 am
What happens when the government realizes that bitshares x exist as an unregulated futures market? I feel like the logical response is to condemn and criminalize the exchange of bitshares. I don't think the government realizes that this is where the bitcoin technology is going. They still think that bitcoin is merely a currency. While I realize the potential merits of prediction markets, the simple fact is that they are not legal.
Title: Re: Legality of Prediction Markets and Dacs
Post by: Markus on January 28, 2014, 02:01:21 am
When you say they are not legal, which jurisdiction are you referring to?
Title: Re: Legality of Prediction Markets and Dacs
Post by: weiry on January 28, 2014, 03:31:05 am
I think that the logical response would be to recognize that people ought to be free to participate in whichever market they choose.

I'd guess that it's not condemned and criminalized immediately. The decentralized nature of the platform will take regulators longer to come to terms with. The US government would have shut down bitcoin long ago if they could simply just condemn and criminalize it.

Given that the platform is fraud proof I think they'll initially leave it alone and any eventual regulation we see will be for all crypto-assets in general.
Title: Re: Legality of Prediction Markets and Dacs
Post by: clout on January 28, 2014, 04:31:38 am
I think that the logical response would be to recognize that people ought to be free to participate in whichever market they choose.

I'd guess that it's not condemned and criminalized immediately. The decentralized nature of the platform will take regulators longer to come to terms with. The US government would have shut down bitcoin long ago if they could simply just condemn and criminalize it.

Given that the platform is fraud proof I think they'll initially leave it alone and any eventual regulation we see will be for all crypto-assets in general.

I agree but thats not how the us government operates. They have shut down all prediction markets other than the Iowa Electronic Market and thats only because this market is heavily regulated and is used for academic purposes. Additionally governments can shut down bitcoin. Crypto currency adoption depends upon exchanges which are centralized establishments that must work within the confines of the law.
Title: Re: Legality of Prediction Markets and Dacs
Post by: bytemaster on January 28, 2014, 05:44:42 am
Fortunately this market is using play money and thus legal.   Only prediction markets that deal in fiat have had problems.   See hollywood stock exchange for an example.
Title: Re: Legality of Prediction Markets and Dacs
Post by: Amazon on January 28, 2014, 05:51:17 am
Fortunately this market is using play money and thus legal.   Only prediction markets that deal in fiat have had problems.   See hollywood stock exchange for an example.

+1 to the question

from the newest update in http://www.dfi.wa.gov/cs/money-services-providers.htm, crypto-currency is included in the definition of "Money".

Quote
Virtual Currency
Virtual currency, also known as digital currency or crypto-currency, is a medium of exchange not authorized or adopted by a government. There are many different digital currencies being used over the internet, the most commonly known being Bitcoin. In Washington, digital currency is included in the definition of "Money" in the Uniform Money Services Act (UMSA), chapter 19.230 RCW:

"Money means a medium of exchange that is authorized or adopted by the United States or a foreign government or other recognized medium of exchange. "Money" includes a monetary unit of account established by an intergovernmental organization or by agreement between two or more governments."

Companies wishing to transmit money for Washington residents in a digital currency form can contact DFI for a determination whether licensure under the UMSA is required. If it is, a license is required before the company can engage in the activity.
Title: Re: Legality of Prediction Markets and Dacs
Post by: Markus on January 28, 2014, 06:00:07 am
I agree but thats not how the us government operates. They have shut down all prediction markets other than the Iowa Electronic Market and thats only because this market is heavily regulated and is used for academic purposes. Additionally governments can shut down bitcoin. Crypto currency adoption depends upon exchanges which are centralized establishments that must work within the confines of the law.

There are so many investments around where the cover page of the brochure boldly states "Not for dissemination in the United States of America". Some people might miss out, but I don't think it would be a problem for BitShares adoption or other DACs.

Do you care about BitCoins being illegal in Thailand?
Do you think most Thai care?
Do you think this significantly hinders BitCoin dissemination in Thailand?
Title: Re: Legality of Prediction Markets and Dacs
Post by: santaclause102 on January 28, 2014, 09:30:12 am
What about the possibility of shorting shares of a company via Bitshares and then attacking that company in the real world making the price of the company shares drop? Due to the anonymous nature of BTS the attacker with his short position could get away with it and take huge profits... Think of airlines....
Title: Re: Legality of Prediction Markets and Dacs
Post by: valtr on January 28, 2014, 09:59:58 am
What about the possibility of shorting shares of a company via Bitshares and then attacking that company in the real world making the price of the company shares drop? Due to the anonymous nature of BTS the attacker with his short position could get away with it and take huge profits... Think of airlines....
I think it is not possible because on Bitshares such a share is not real share but only CFD.
CFD is something like bet on price.

https://en.wikipedia.org/wiki/Contract_for_difference
Title: Re: Legality of Prediction Markets and Dacs
Post by: santaclause102 on January 28, 2014, 10:09:01 am
What about the possibility of shorting shares of a company via Bitshares and then attacking that company in the real world making the price of the company shares drop? Due to the anonymous nature of BTS the attacker with his short position could get away with it and take huge profits... Think of airlines....
I think it is not possible because on Bitshares such a share is not real share but only CFD.
CFD is something like bet on price.

https://en.wikipedia.org/wiki/Contract_for_difference

But if reflects the price of the real share....
Title: Re: Legality of Prediction Markets and Dacs
Post by: valtr on January 28, 2014, 10:43:04 am
What about the possibility of shorting shares of a company via Bitshares and then attacking that company in the real world making the price of the company shares drop? Due to the anonymous nature of BTS the attacker with his short position could get away with it and take huge profits... Think of airlines....
I think it is not possible because on Bitshares such a share is not real share but only CFD.
CFD is something like bet on price.

https://en.wikipedia.org/wiki/Contract_for_difference

But if reflects the price of the real share....
It reflects the price, otherwise it would have no sence. Shorting CFD when real share price is going up means that you lose money.
My opinion is that real shares do not care about CFD, but CFD are fully dependend on real shares price.
Off course if you short real share and the share is going up, you lose money too.
But provided you are a big player (funds, banks etc.) you may set a new trend or at least make money on cheaper buyback.

It is my view, maybe it is more complex problem.
Title: Re: Legality of Prediction Markets and Dacs
Post by: clout on January 28, 2014, 03:56:24 pm
Fortunately this market is using play money and thus legal.   Only prediction markets that deal in fiat have had problems.   See hollywood stock exchange for an example.

H$ is play money. Crypto currencies aren't play money. You can't cash out of H$, whereas you can cash out of bitshares or bitcoin or any other alt coin with tangible profits. That is what governments are concerned about, particularly with crypto currencies. People stand to profit from them while governments are uncertain of how to take a piece of that profit.

Calling crypto currencies play money is a very questionable response to my question...

Title: Re: Legality of Prediction Markets and Dacs
Post by: bytemaster on January 28, 2014, 04:34:29 pm
Fortunately this market is using play money and thus legal.   Only prediction markets that deal in fiat have had problems.   See hollywood stock exchange for an example.

H$ is play money. Crypto currencies aren't play money. You can't cash out of H$, whereas you can cash out of bitshares or bitcoin or any other alt coin with tangible profits. That is what governments are concerned about, particularly with crypto currencies. People stand to profit from them while governments are uncertain of how to take a piece of that profit.

Calling crypto currencies play money is a very questionable response to my question...

You can cash out of Linden Dollars too.   Whether it is legal or not in your jurisdiction does not change the fact that it is perfectly legal to develop open source software and publish it as free speech.   

The laws do not compile and there are 1000 ways to interpret everything as either legal or illegal. 

Title: Re: Legality of Prediction Markets and Dacs
Post by: clout on January 28, 2014, 05:09:50 pm
Fortunately this market is using play money and thus legal.   Only prediction markets that deal in fiat have had problems.   See hollywood stock exchange for an example.

H$ is play money. Crypto currencies aren't play money. You can't cash out of H$, whereas you can cash out of bitshares or bitcoin or any other alt coin with tangible profits. That is what governments are concerned about, particularly with crypto currencies. People stand to profit from them while governments are uncertain of how to take a piece of that profit.

Calling crypto currencies play money is a very questionable response to my question...

You can cash out of Linden Dollars too.   Whether it is legal or not in your jurisdiction does not change the fact that it is perfectly legal to develop open source software and publish it as free speech.   

The laws do not compile and there are 1000 ways to interpret everything as either legal or illegal.


Second life contains a virtual economy, it does not constitute a platform for betting, which is precisely how the us government will look at bitshares and any other prediction markets that result from its development. From an investors point of view this presents significant risk. If your product does not comply with the regulations of major governments I don't believe it will be adopted. If you cannot assuage these concerns how can I or anyone else rationally invest in your product?
Title: Re: Legality of Prediction Markets and Dacs
Post by: bytemaster on January 28, 2014, 05:34:09 pm
Fortunately this market is using play money and thus legal.   Only prediction markets that deal in fiat have had problems.   See hollywood stock exchange for an example.

H$ is play money. Crypto currencies aren't play money. You can't cash out of H$, whereas you can cash out of bitshares or bitcoin or any other alt coin with tangible profits. That is what governments are concerned about, particularly with crypto currencies. People stand to profit from them while governments are uncertain of how to take a piece of that profit.

Calling crypto currencies play money is a very questionable response to my question...

You can cash out of Linden Dollars too.   Whether it is legal or not in your jurisdiction does not change the fact that it is perfectly legal to develop open source software and publish it as free speech.   

The laws do not compile and there are 1000 ways to interpret everything as either legal or illegal.


Second life contains a virtual economy, it does not constitute a platform for betting, which is precisely how the us government will look at bitshares and any other prediction markets that result from its development. From an investors point of view this presents significant risk. If your product does not comply with the regulations of major governments I don't believe it will be adopted. If you cannot assuage these concerns how can I or anyone else rationally invest in your product?

Second Life has gambling platforms built into the game.  Just because you can use a currency for 'gambling' doesn't mean it is regulated.
For one thing betting is just one way of looking at this, another is that it operates no differently than a Credit Union or Bank.  It lends dollars into existence based upon collateral (stock in the bank).  In this sense it is little different than Bitcoin or any 'regulated' bank except that it is entirely transparent and 200% reserve rather than fractional reserve.

I would contend that whether you call it a prediction market, a bank, a currency, an equity, or anything else that the regulators rules do not accurately apply.   It should really be considered a "math-based digital asset" as the W. Twins filed in their application with the SEC.   These instruments are entirely NEW.

Worst case scenario the US government outlaws even running the application as an end user, it will become like drugs inside the US and likely result in the banning of Bitcoin as well.   The US market is only 4% of the worlds population and the benefits offered by our products can produce trillions of dollars of value to other parts of the world where it will be legal.   

As someone giving to our cause ("Capitalism takes more people out of poverty than Aid") by donating to one of our addresses or buying PTS you should be considering the global impact of these technologies and not just US centric regulatory views.  We are focused on keeping our legal exposure as small as possible so we can impact the masses who are unbanked. 


(http://static.guim.co.uk/sys-images/Guardian/Pix/pictures/2013/6/17/1371487456356/Bono-in-Tanzania-010.jpg)
"Bono says capitalism takes more people out of poverty than aid."
Title: Re: Legality of Prediction Markets and Dacs
Post by: onceuponatime on January 28, 2014, 06:53:26 pm
here is some interesting thinking from the bitcointalk forum:

 Re: Why Bitcoin is doomed to fail, and there's nothing you can do about it.
Today at 06:12:19 PM

If you are interested about how to bypass government, consider this. The constitution, Article 1, Section 10, Clause 1 has a statement in it that says: "No State shall ... make any ... Law impairing the Obligation of Contracts ..." The Federal Government has been adjudicated to be a state. See: Enright v. U.S., D.C.N.Y., 437 F.Supp. 580, 581.

Here's what to get pushed through the courts. Form contracts for any business that you do with other people. Let the contracts invoke the above Article 1 wording along with wording stating that it is the intent of the contract and the parties to the contract that no state laws apply except upon an explicit allowance by the parties to the contract that they are accepting certain stated laws. Throw in the wording that the Federal Government is a state. Say, also, that not answering a challenge by some some state authority in no way waives any part of the contract.

Apply the above with enumerations of specific laws that you do not want to apply to the contract or the parties thereof - IRS taxation, and business licensing, for example.

Doing this will make your Bitcoin transacting to match your terms and not government terms.

Smiley
Title: Re: Legality of Prediction Markets and Dacs
Post by: bytemaster on January 28, 2014, 07:02:34 pm
here is some interesting thinking from the bitcointalk forum:

 Re: Why Bitcoin is doomed to fail, and there's nothing you can do about it.
Today at 06:12:19 PM

If you are interested about how to bypass government, consider this. The constitution, Article 1, Section 10, Clause 1 has a statement in it that says: "No State shall ... make any ... Law impairing the Obligation of Contracts ..." The Federal Government has been adjudicated to be a state. See: Enright v. U.S., D.C.N.Y., 437 F.Supp. 580, 581.

Here's what to get pushed through the courts. Form contracts for any business that you do with other people. Let the contracts invoke the above Article 1 wording along with wording stating that it is the intent of the contract and the parties to the contract that no state laws apply except upon an explicit allowance by the parties to the contract that they are accepting certain stated laws. Throw in the wording that the Federal Government is a state. Say, also, that not answering a challenge by some some state authority in no way waives any part of the contract.

Apply the above with enumerations of specific laws that you do not want to apply to the contract or the parties thereof - IRS taxation, and business licensing, for example.

Doing this will make your Bitcoin transacting to match your terms and not government terms.

Smiley

This is a wonderful strategy and mirrors what I have been talking about at the conference: the post-contract society.   Eliminate contracts from every interaction you engage in and the government loses all jurisdiction over the agreement.   It no longer becomes a security, etc. 
Title: Re: Legality of Prediction Markets and Dacs
Post by: santaclause102 on January 28, 2014, 07:31:13 pm
Apart form legal considerations...
What about the possibility of shorting shares of a company via Bitshares and then attacking that company in the real world making the price of the company's shares drop? Due to the anonymous nature of BTS the attacker with his short position could get away with it and take huge profits... Think of airlines. Of course it is bluntly criminal but would Bitshares allow to take profits form this criminal actions and therefore provide incentives to do so? What is stopping anyone from doing this if Bitshares works?

Title: Re: Legality of Prediction Markets and Dacs
Post by: busygin on January 28, 2014, 08:06:52 pm
Remember that blockchain is only pseudo anonymous and the addresses connected to such activity will be pretty quickly marked in blockchain explorer like this one:
1CbR8da9YPZqXJJKm9ze1GYf67eKAUfXwP
Title: Re: Legality of Prediction Markets and Dacs
Post by: santaclause102 on January 28, 2014, 08:18:12 pm
There are possibilities to enhance anonymity through mixing services for example.   
The conclusion is that there is a contradiction between anonymity and security risks for the general public, specifically through the scenario quoted above.
Title: Re: Legality of Prediction Markets and Dacs
Post by: bytemaster on January 28, 2014, 08:44:04 pm
Apart form legal considerations...
What about the possibility of shorting shares of a company via Bitshares and then attacking that company in the real world making the price of the company's shares drop? Due to the anonymous nature of BTS the attacker with his short position could get away with it and take huge profits... Think of airlines. Of course it is bluntly criminal but would Bitshares allow to take profits form this criminal actions and therefore provide incentives to do so? What is stopping anyone from doing this if Bitshares works?

I actually do not believe this is criminal or immoral the act of going short in the first place signals to the market that new information suggests the price should be lower.  Imagine what would happen if investors had to discount news until it was verified because everyone knows this kind of attack is possible.   It would create a profit opportunity for everyone who isn't suckered into the attack (which I presume is a false attack full of lies).   In effect, the market can handle these kinds of manipulations when people are not lulled into complacency that some regulatory body can outlaw this kind of behavior...

In other words this kind of attack only works in markets where people are not fact checking and instead trusting regulators.   The result of the regulators is that these types of attacks still occur and are in fact far more successful. 
Title: Re: Legality of Prediction Markets and Dacs
Post by: santaclause102 on January 28, 2014, 09:07:03 pm
Apart form legal considerations...
What about the possibility of shorting shares of a company via Bitshares and then attacking that company in the real world making the price of the company's shares drop? Due to the anonymous nature of BTS the attacker with his short position could get away with it and take huge profits... Think of airlines. Of course it is bluntly criminal but would Bitshares allow to take profits form this criminal actions and therefore provide incentives to do so? What is stopping anyone from doing this if Bitshares works?

I actually do not believe this is criminal or immoral the act of going short in the first place signals to the market that new information suggests the price should be lower.  Imagine what would happen if investors had to discount news until it was verified because everyone knows this kind of attack is possible.   It would create a profit opportunity for everyone who isn't suckered into the attack (which I presume is a false attack full of lies).   In effect, the market can handle these kinds of manipulations when people are not lulled into complacency that some regulatory body can outlaw this kind of behavior...

In other words this kind of attack only works in markets where people are not fact checking and instead trusting regulators.   The result of the regulators is that these types of attacks still occur and are in fact far more successful.

Sorry, didn't really get what you said. Let's keep it practical and simple. Consider the following case:
I go short on Walmart shares with a lot of money. Then I inject poison into all kinds of foods sold in Walmart stores and I do this for a continued period of time. Then nobody will buy food at Walmart anymore -> Big losses -> Shares price drops -> BitWaltmartshares follow the Walmart shares price and I take my profits.
You could do this with all kinds of companies: Attacking Servers of companies, crashing planes... There is the risk of course of getting caught just like before but the posibilities to profit from it increase heavily if shorting shares/anything is completely anonymous.
When we are talking about leaving contracts aside and replacing them with the peer2peer exchange of value we are talking about leaving the need for trust aside and replacing it with self interest guided systems. I see great potential in that in a globalized world but the above would provide an incentive structure that goes against common interest.   
Title: Re: Legality of Prediction Markets and Dacs
Post by: Darkbane on March 03, 2014, 01:50:44 am
What happens when the government realizes that bitshares x exist as an unregulated futures market? I feel like the logical response is to condemn and criminalize the exchange of bitshares. I don't think the government realizes that this is where the bitcoin technology is going. They still think that bitcoin is merely a currency. While I realize the potential merits of prediction markets, the simple fact is that they are not legal.

well nothing is stopping future laws... however currently, the feds have declared they see this as commodity trading... now like as I have been pointing out there is a whole host of new legal concerns due to the ways of things being done and could be construed as something more than a commodity... like AGS not being able to be traded, its no longer a tradeable commodity, its an actual share in my eyes as of now...

nothing stops the government from seizing things when they find applicable law for a situation... the seizure of thousands tens of thousands of bitcoins over the last years has demonstrated that... they've shutdown the silkroad exchange in combination with another country acting together through criminal treaties... we're lucky the feds do not consider it a currency, or we could have a whole host of other issues for the community... so being a commodity is a good thing as this point...
Title: Re: Legality of Prediction Markets and Dacs
Post by: unimercio on March 04, 2014, 01:12:04 am
 +5% +5% +5% +5%
Fortunately this market is using play money and thus legal.   Only prediction markets that deal in fiat have had problems.   See hollywood stock exchange for an example.

H$ is play money. Crypto currencies aren't play money. You can't cash out of H$, whereas you can cash out of bitshares or bitcoin or any other alt coin with tangible profits. That is what governments are concerned about, particularly with crypto currencies. People stand to profit from them while governments are uncertain of how to take a piece of that profit.

Calling crypto currencies play money is a very questionable response to my question...

You can cash out of Linden Dollars too.   Whether it is legal or not in your jurisdiction does not change the fact that it is perfectly legal to develop open source software and publish it as free speech.   

The laws do not compile and there are 1000 ways to interpret everything as either legal or illegal.


Second life contains a virtual economy, it does not constitute a platform for betting, which is precisely how the us government will look at bitshares and any other prediction markets that result from its development. From an investors point of view this presents significant risk. If your product does not comply with the regulations of major governments I don't believe it will be adopted. If you cannot assuage these concerns how can I or anyone else rationally invest in your product?

Second Life has gambling platforms built into the game.  Just because you can use a currency for 'gambling' doesn't mean it is regulated.
For one thing betting is just one way of looking at this, another is that it operates no differently than a Credit Union or Bank.  It lends dollars into existence based upon collateral (stock in the bank).  In this sense it is little different than Bitcoin or any 'regulated' bank except that it is entirely transparent and 200% reserve rather than fractional reserve.

I would contend that whether you call it a prediction market, a bank, a currency, an equity, or anything else that the regulators rules do not accurately apply.   It should really be considered a "math-based digital asset" as the W. Twins filed in their application with the SEC.   These instruments are entirely NEW.

Worst case scenario the US government outlaws even running the application as an end user, it will become like drugs inside the US and likely result in the banning of Bitcoin as well.   The US market is only 4% of the worlds population and the benefits offered by our products can produce trillions of dollars of value to other parts of the world where it will be legal.   

As someone giving to our cause ("Capitalism takes more people out of poverty than Aid") by donating to one of our addresses or buying PTS you should be considering the global impact of these technologies and not just US centric regulatory views.  We are focused on keeping our legal exposure as small as possible so we can impact the masses who are unbanked. 


(http://static.guim.co.uk/sys-images/Guardian/Pix/pictures/2013/6/17/1371487456356/Bono-in-Tanzania-010.jpg)
"Bono says capitalism takes more people out of poverty than aid."
Title: Re: Legality of Prediction Markets and Dacs
Post by: luckybit on March 07, 2014, 05:11:01 pm
I think that the logical response would be to recognize that people ought to be free to participate in whichever market they choose.

I'd guess that it's not condemned and criminalized immediately. The decentralized nature of the platform will take regulators longer to come to terms with. The US government would have shut down bitcoin long ago if they could simply just condemn and criminalize it.

Given that the platform is fraud proof I think they'll initially leave it alone and any eventual regulation we see will be for all crypto-assets in general.

I agree but thats not how the us government operates. They have shut down all prediction markets other than the Iowa Electronic Market and thats only because this market is heavily regulated and is used for academic purposes. Additionally governments can shut down bitcoin. Crypto currency adoption depends upon exchanges which are centralized establishments that must work within the confines of the law.

I think Bitshares will need to find a way to self regulate. You're right if it's filled with the wrong kind of prediction markets it could make the entire Bitshares experiment look bad.

The initial version of Bitshares XT isn't a big deal. It all depends on the nature of the prediction market, I think anything involving politics would quickly be attacked and should be avioded. Anything involving celebrities, or just any predictions involving people in general should not be encouraged.

Avoid stuff like this in particular http://www.cnn.com/2003/ALLPOLITICS/07/29/terror.market/
Title: Re: Legality of Prediction Markets and Dacs
Post by: luckybit on March 07, 2014, 05:20:11 pm
here is some interesting thinking from the bitcointalk forum:

 Re: Why Bitcoin is doomed to fail, and there's nothing you can do about it.
Today at 06:12:19 PM

If you are interested about how to bypass government, consider this. The constitution, Article 1, Section 10, Clause 1 has a statement in it that says: "No State shall ... make any ... Law impairing the Obligation of Contracts ..." The Federal Government has been adjudicated to be a state. See: Enright v. U.S., D.C.N.Y., 437 F.Supp. 580, 581.

Here's what to get pushed through the courts. Form contracts for any business that you do with other people. Let the contracts invoke the above Article 1 wording along with wording stating that it is the intent of the contract and the parties to the contract that no state laws apply except upon an explicit allowance by the parties to the contract that they are accepting certain stated laws. Throw in the wording that the Federal Government is a state. Say, also, that not answering a challenge by some some state authority in no way waives any part of the contract.

Apply the above with enumerations of specific laws that you do not want to apply to the contract or the parties thereof - IRS taxation, and business licensing, for example.

Doing this will make your Bitcoin transacting to match your terms and not government terms.

Smiley

This is a wonderful strategy and mirrors what I have been talking about at the conference: the post-contract society.   Eliminate contracts from every interaction you engage in and the government loses all jurisdiction over the agreement.   It no longer becomes a security, etc.

This I think is wishful thinking. It might not be a security but it's still going to be seen as barter or something else. They will find a way to tax and regulate our activities. If we do a good job regulating ourselves and discouraging activities which require or attract government interest then that is a better strategy.

I don't think playing lawyer is a very effective strategy but I think if you design Bitshares to be self regulating, and if it's designed to be safer than the real world counterparts in many ways, then when its time for the government to come up with crypto specific regulations they will have less excuses to regulate.

Mt Gox gives them an excuse to try and protect customers. The Bitcoin community allowed Mt Gox to become so centralized and didn't take fraud or scams seriously. This is because programmers simply don't seem to care about those issues. Taxes are another issue most programmers don't seem to care about, but it doesn't change the fact that users will have to pay taxes in some form and if its made easier to report taxes then the community is at least encouraging compliance.

There will certainly be regulations and taxes, we just want the least disruptive regulations and lowest tax rates.
Title: Re: Legality of Prediction Markets and Dacs
Post by: gamey on April 21, 2014, 11:04:58 pm

You can cash out of Linden Dollars too.   Whether it is legal or not in your jurisdiction does not change the fact that it is perfectly legal to develop open source software and publish it as free speech.   

The laws do not compile and there are 1000 ways to interpret everything as either legal or illegal.

You can also cash out/purchase play money on play money certain gambling sites.  Even Facebook sites. There are competing websites for this sort of thing.  They buy and sell play money.

Even if something is 100% created to not have monetary value, someone can come along and create a market for it.
Title: Re: Legality of Prediction Markets and Dacs
Post by: kisa on September 27, 2014, 08:11:53 am
here is some interesting thinking from the bitcointalk forum:

 Re: Why Bitcoin is doomed to fail, and there's nothing you can do about it.
Today at 06:12:19 PM

If you are interested about how to bypass government, consider this. The constitution, Article 1, Section 10, Clause 1 has a statement in it that says: "No State shall ... make any ... Law impairing the Obligation of Contracts ..." The Federal Government has been adjudicated to be a state. See: Enright v. U.S., D.C.N.Y., 437 F.Supp. 580, 581.

Here's what to get pushed through the courts. Form contracts for any business that you do with other people. Let the contracts invoke the above Article 1 wording along with wording stating that it is the intent of the contract and the parties to the contract that no state laws apply except upon an explicit allowance by the parties to the contract that they are accepting certain stated laws. Throw in the wording that the Federal Government is a state. Say, also, that not answering a challenge by some some state authority in no way waives any part of the contract.

Apply the above with enumerations of specific laws that you do not want to apply to the contract or the parties thereof - IRS taxation, and business licensing, for example.

Doing this will make your Bitcoin transacting to match your terms and not government terms.

Smiley

This is a wonderful strategy and mirrors what I have been talking about at the conference: the post-contract society.   Eliminate contracts from every interaction you engage in and the government loses all jurisdiction over the agreement.   It no longer becomes a security, etc.

This I think is wishful thinking. It might not be a security but it's still going to be seen as barter or something else. They will find a way to tax and regulate our activities. If we do a good job regulating ourselves and discouraging activities which require or attract government interest then that is a better strategy.

I don't think playing lawyer is a very effective strategy but I think if you design Bitshares to be self regulating, and if it's designed to be safer than the real world counterparts in many ways, then when its time for the government to come up with crypto specific regulations they will have less excuses to regulate.

Mt Gox gives them an excuse to try and protect customers. The Bitcoin community allowed Mt Gox to become so centralized and didn't take fraud or scams seriously. This is because programmers simply don't seem to care about those issues. Taxes are another issue most programmers don't seem to care about, but it doesn't change the fact that users will have to pay taxes in some form and if its made easier to report taxes then the community is at least encouraging compliance.

There will certainly be regulations and taxes, we just want the least disruptive regulations and lowest tax rates.

 +5% time to create self-regulation task force?
Title: Re: Legality of Prediction Markets and Dacs
Post by: luckybit on September 27, 2014, 11:16:41 pm
here is some interesting thinking from the bitcointalk forum:

 Re: Why Bitcoin is doomed to fail, and there's nothing you can do about it.
Today at 06:12:19 PM

If you are interested about how to bypass government, consider this. The constitution, Article 1, Section 10, Clause 1 has a statement in it that says: "No State shall ... make any ... Law impairing the Obligation of Contracts ..." The Federal Government has been adjudicated to be a state. See: Enright v. U.S., D.C.N.Y., 437 F.Supp. 580, 581.

Here's what to get pushed through the courts. Form contracts for any business that you do with other people. Let the contracts invoke the above Article 1 wording along with wording stating that it is the intent of the contract and the parties to the contract that no state laws apply except upon an explicit allowance by the parties to the contract that they are accepting certain stated laws. Throw in the wording that the Federal Government is a state. Say, also, that not answering a challenge by some some state authority in no way waives any part of the contract.

Apply the above with enumerations of specific laws that you do not want to apply to the contract or the parties thereof - IRS taxation, and business licensing, for example.

Doing this will make your Bitcoin transacting to match your terms and not government terms.

Smiley

This is a wonderful strategy and mirrors what I have been talking about at the conference: the post-contract society.   Eliminate contracts from every interaction you engage in and the government loses all jurisdiction over the agreement.   It no longer becomes a security, etc.

This I think is wishful thinking. It might not be a security but it's still going to be seen as barter or something else. They will find a way to tax and regulate our activities. If we do a good job regulating ourselves and discouraging activities which require or attract government interest then that is a better strategy.

I don't think playing lawyer is a very effective strategy but I think if you design Bitshares to be self regulating, and if it's designed to be safer than the real world counterparts in many ways, then when its time for the government to come up with crypto specific regulations they will have less excuses to regulate.

Mt Gox gives them an excuse to try and protect customers. The Bitcoin community allowed Mt Gox to become so centralized and didn't take fraud or scams seriously. This is because programmers simply don't seem to care about those issues. Taxes are another issue most programmers don't seem to care about, but it doesn't change the fact that users will have to pay taxes in some form and if its made easier to report taxes then the community is at least encouraging compliance.

There will certainly be regulations and taxes, we just want the least disruptive regulations and lowest tax rates.

 +5% time to create self-regulation task force?

The delegates.
Title: Re: Legality of Prediction Markets and Dacs
Post by: eagleeye on September 29, 2014, 06:20:16 am
Apart form legal considerations...
What about the possibility of shorting shares of a company via Bitshares and then attacking that company in the real world making the price of the company's shares drop? Due to the anonymous nature of BTS the attacker with his short position could get away with it and take huge profits... Think of airlines. Of course it is bluntly criminal but would Bitshares allow to take profits form this criminal actions and therefore provide incentives to do so? What is stopping anyone from doing this if Bitshares works?

I actually do not believe this is criminal or immoral the act of going short in the first place signals to the market that new information suggests the price should be lower.  Imagine what would happen if investors had to discount news until it was verified because everyone knows this kind of attack is possible.   It would create a profit opportunity for everyone who isn't suckered into the attack (which I presume is a false attack full of lies).   In effect, the market can handle these kinds of manipulations when people are not lulled into complacency that some regulatory body can outlaw this kind of behavior...

In other words this kind of attack only works in markets where people are not fact checking and instead trusting regulators.   The result of the regulators is that these types of attacks still occur and are in fact far more successful.

Sorry, didn't really get what you said. Let's keep it practical and simple. Consider the following case:
I go short on Walmart shares with a lot of money. Then I inject poison into all kinds of foods sold in Walmart stores and I do this for a continued period of time. Then nobody will buy food at Walmart anymore -> Big losses -> Shares price drops -> BitWaltmartshares follow the Walmart shares price and I take my profits.
You could do this with all kinds of companies: Attacking Servers of companies, crashing planes... There is the risk of course of getting caught just like before but the posibilities to profit from it increase heavily if shorting shares/anything is completely anonymous.
When we are talking about leaving contracts aside and replacing them with the peer2peer exchange of value we are talking about leaving the need for trust aside and replacing it with self interest guided systems. I see great potential in that in a globalized world but the above would provide an incentive structure that goes against common interest.   

This is probably why we will not be able to have anonymous accounts in the future.  One word comes to mind....terrorism.  We must stop its action at all costs.
Title: Re: Legality of Prediction Markets and Dacs
Post by: xeroc on September 29, 2014, 06:54:24 am
This is probably why we will not be able to have anonymous accounts in the future.  One word comes to mind....terrorism.  We must stop its action at all costs.
aehm?

sorry but I don't fall for the "terrorism" shit .. you know that more people die due to cancer OR car accidents OR weapons fired at family mates in the US than by terrorism?!?
Get the numbers straight an we can talk! anonymous transactions ARE an important feature .. and the blockchain enables them no matter what the front end allows the end users ..

However, BM wants to add the ability to ALSO have verified names and public transactions .. and THAT is a killer feature
Title: Re: Legality of Prediction Markets and Dacs
Post by: vegolino on September 29, 2014, 11:39:51 am
Quote
This is probably why we will not be able to have anonymous accounts in the future.  One word comes to mind....terrorism.  We must stop its action at all costs.

Eagleeye I know this is what mainstream media tells us, but what is your opinion on it? Are you in agreement with mainstream media? Have you ever tried to read zerohedge, if not you should check it out.

Title: Re: Legality of Prediction Markets and Dacs
Post by: lakerta06 on September 29, 2014, 12:02:32 pm
The real terrorism is the centralized mainstream media pumping the fear...


Title: Re: Legality of Prediction Markets and Dacs
Post by: GaltReport on September 29, 2014, 12:22:01 pm
This is probably why we will not be able to have anonymous accounts in the future.  One word comes to mind....terrorism.  We must stop its action at all costs.
aehm?

sorry but I don't fall for the "terrorism" shit .. you know that more people die due to cancer OR car accidents OR weapons fired at family mates in the US than by terrorism?!?
Get the numbers straight an we can talk! anonymous transactions ARE an important feature .. and the blockchain enables them no matter what the front end allows the end users ..

However, BM wants to add the ability to ALSO have verified names and public transactions .. and THAT is a killer feature

+100% (don't get me started...)
Title: Re: Legality of Prediction Markets and Dacs
Post by: eagleeye on September 30, 2014, 02:06:48 am
Quote
This is probably why we will not be able to have anonymous accounts in the future.  One word comes to mind....terrorism.  We must stop its action at all costs.

Eagleeye I know this is what mainstream media tells us, but what is your opinion on it? Are you in agreement with mainstream media? Have you ever tried to read zerohedge, if not you should check it out.

I have been reading zerohedge for years.  The mainstream controls us.
Title: Re: Legality of Prediction Markets and Dacs
Post by: eagleeye on September 30, 2014, 02:08:30 am
This is probably why we will not be able to have anonymous accounts in the future.  One word comes to mind....terrorism.  We must stop its action at all costs.
aehm?

sorry but I don't fall for the "terrorism" shit .. you know that more people die due to cancer OR car accidents OR weapons fired at family mates in the US than by terrorism?!?
Get the numbers straight an we can talk! anonymous transactions ARE an important feature .. and the blockchain enables them no matter what the front end allows the end users ..

However, BM wants to add the ability to ALSO have verified names and public transactions .. and THAT is a killer feature

I dont believe the "terrorism" shit for one second.  But its what controls the government.
Title: Re: Legality of Prediction Markets and Dacs
Post by: Stan on September 30, 2014, 02:18:35 am
This is probably why we will not be able to have anonymous accounts in the future.  One word comes to mind....terrorism.  We must stop its action at all costs.

All costs?

That would include whatever freedom you have left.

 :)
Title: Re: Legality of Prediction Markets and Dacs
Post by: Stan on September 30, 2014, 02:50:11 am
This is probably why we will not be able to have anonymous accounts in the future.  One word comes to mind....terrorism.  We must stop its action at all costs.

All costs?

That would include whatever freedom you have left.

 :)
That will not be giving up much...



Our ancestors fought for freedom.
We engineer it.

Title: Re: Legality of Prediction Markets and Dacs
Post by: eagleeye on September 30, 2014, 04:18:41 am
This is probably why we will not be able to have anonymous accounts in the future.  One word comes to mind....terrorism.  We must stop its action at all costs.

All costs?

That would include whatever freedom you have left.

 :)
That will not be giving up much...

ISIS is everywhere.  You may change your tune when shit hits the fan.  Will this happen I dont think so but if 100 coordinated terrorist attacks occur. 

We wont be getting anonymous accounts.  Bytemaster is not the government, he may be a true innovator but he does not have the money to dictate federal policy yet.  Think about each anonymous account like the swiss banking laws of the past.  You really think they (the government) is going to let us keep anonymous transactions.  Like seriously.
Title: Re: Legality of Prediction Markets and Dacs
Post by: Stan on September 30, 2014, 04:45:22 am
This is probably why we will not be able to have anonymous accounts in the future.  One word comes to mind....terrorism.  We must stop its action at all costs.

All costs?

That would include whatever freedom you have left.

 :)
That will not be giving up much...

ISIS is everywhere.  You may change your tune when shit hits the fan.  Will this happen I dont think so but if 100 coordinated terrorist attacks occur. 

We wont be getting anonymous accounts.  Bytemaster is not the government, he may be a true innovator but he does not have the money to dictate federal policy yet.  Think about each anonymous account like the swiss banking laws of the past.  You really think they (the government) is going to let us keep anonymous transactions.  Like seriously.

I don't expect anyone to "let" us do anything.

Such a spectacular attack would have two consequences:

1.  Strengthening the resolve of those who have gone soft from too much safety.
2.  Weakening the resolve of those who would exchange true freedom for false safety.

I am hoping that the first will offset the second, but that is merely a hope.

Meanwhile, I am statistically far more likely to be harmed by someone presuming to "protect" me.

Title: Re: Legality of Prediction Markets and Dacs
Post by: onceuponatime on September 30, 2014, 05:39:20 am
This is probably why we will not be able to have anonymous accounts in the future.  One word comes to mind....terrorism.  We must stop its action at all costs.

All costs?

That would include whatever freedom you have left.

 :)
That will not be giving up much...

ISIS is everywhere.  You may change your tune when shit hits the fan.  Will this happen I dont think so but if 100 coordinated terrorist attacks occur. 

We wont be getting anonymous accounts.  Bytemaster is not the government, he may be a true innovator but he does not have the money to dictate federal policy yet.  Think about each anonymous account like the swiss banking laws of the past.  You really think they (the government) is going to let us keep anonymous transactions.  Like seriously.

Seriously, dude, I think that you have somehow stumbled upon the wrong community.  It would be much happier for you (and us) if you searched out like minded personages with whom to share your expertise.
Title: Re: Legality of Prediction Markets and Dacs
Post by: eagleeye on September 30, 2014, 06:52:49 am
Here is the test.  Does the government let you have swiss (Switzerland) coded bank accounts which are 100% anonymous.  NO

Will they let us have anonymous accounts?  NO


Do you think you can stop the US government?  No.
Title: Re: Legality of Prediction Markets and Dacs
Post by: xeroc on September 30, 2014, 07:35:46 am
Meanwhile, I am statistically far more likely to be harmed by someone presuming to "protect" me.
... well played  :o
Title: Re: Legality of Prediction Markets and Dacs
Post by: xeroc on September 30, 2014, 07:36:43 am
Do you think you can stop the US government?  No.
Not me in particular .. but the people over in the US can do so! It's still (at least on paper) a democracy!
Title: Re: Legality of Prediction Markets and Dacs
Post by: eagleeye on September 30, 2014, 08:04:20 am
Do you think you can stop the US government?  No.
Not me in particular .. but the people over in the US can do so! It's still (at least on paper) a democracy!

Its actually a republic.
Title: Re: Legality of Prediction Markets and Dacs
Post by: Stan on September 30, 2014, 01:08:16 pm
Do you see that tiny stream of water down there?  That's us.  ;D

(http://i.gyazo.com/d491ea9a5b4d629a2a3719b8e4fb2ee5.png)
Title: Re: Legality of Prediction Markets and Dacs
Post by: santaclause102 on September 30, 2014, 02:01:55 pm
Isn't the solution simple: one chain which allows anonymous tx and one which doesn't. Both chains will have different use cases / users... If they try to shut down the anonymous one it will be a test for the global resilience of DPOS.