It’s not about violating sanctions, it’s about a system being incompatible with enforcement. Of course authorities will try to go after those that attempt to violate sanctions - they should. This is not a call to violate sanctions. It is a cold reality about the nature of enforcement.
But the system itself, the local laws are irrelevant to the software implementation.
The people duped into the decentralized cryptocurrency scam have mistakenly believed that cryptocurrencies fall into the latter category. First China and now the US are correcting that misconception.
The law is incapable of regulating a system like Bitcoin. This is by design. I know you don’t like that, but the cypherpunks know their enemy. The only misconception is thinking anyone can law this technology away. Only math and physics matters. The law is just human noise.
China used to run more than half of all Bitcoin nodes. Now it's already less than 1% and dropping. The only reason it is still that high is that they haven't bothered to start enforcement yet.
China has to deal with financial fraud just as much as any other large country, so there is no reason to expect they will deregulate cryptocurrencies or any other financial instruments.
Literally designed against such things. Nodes are not mining nodes. The entirety of the miners could leave the US (this would not be a good thing for the US economy in the future), and the system would still work. You think I am crazy. Crazy is not understand the largest separation between money and state in human history.
This bill is fantasy. A) Nobody is going to accept changes to the codebase to enforce any of this. It is an attack and will be routed around. B) You cannot tell apriori a tx is from a sanctioned party, and after the fact it’s way too late. C) you cannot undo transactions D) blocks and rewards can be mined so that they are unattributable.
We are 13 years in here. We never would have gotten past year 2 if States could do anything about this. Anyway. We both know each other’s opinions. I like mine because “honey badger does not give a shit”.
This is the outcome I expect, and the US will have less energy waste, which is a nice benefit.
> Crazy is not understand the largest separation between money and state in human history.
Bitcoin is not more separate from the state than gold and silver, and it suffers many of the same problems.
> You cannot tell apriori a tx is from a sanctioned party
As soon as a wallet is identified as belonging to a sanctioned individual, no further transactions from that wallet will be accepted.
> and after the fact it’s way too late... you cannot undo transactions
This is not necessary. The value of the transferred coins drops because all downstream UTXOs are blacklisted from regulated exchanges. Nobody in the US or any other country that regulates cryptocurrencies will accept the tainted coins.
> blocks and rewards can be mined so that they are unattributable.
This has the same problem as currently unknown wallets that I listed above. As soon as the owner of a wallet is identified, all its contents become tainted. In practice, this means that people will be less likely to accept payment from unknown wallets, which results in market forces that will push for every transacting wallet to be identified.
> We are 13 years in here.
Because the state has ignored the harms of decentralized cryptocurrencies until this point. This is simply about being ahead of the law instead of being above the law.