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81 sats \ 3 replies \ @freetx 27 Feb
"Never pass a law you can't enforce".
I'm curious how the regulators are going to tackle this.....there is honestly nothing worse for gov than to pass a law it cannot enforce because it then taints all their power. They can write words on paper stating whatever they want, but I can't think of any way they can prevent people from self-custodying and trading digital assets.
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42 sats \ 2 replies \ @Winitober 27 Feb
I suspect that we will see a bifurcation between KYC and non-KYC assets. For example, Bitcoin that can be traced and is custodied between KYC organizations (e.g., hosted wallets, exchanges, Lightning nodes) versus 'outsiders.' One of the few Achilles' heels of Bitcoin is fungibility, not all UTXOs are created equal, and their lineage can be traced.
A similar dynamic exists in gold markets, where gold held in COMEX and LBMA vaults, or 'registered' gold, is distinguished from other forms. Once gold leaves these systems, it must go through a lengthy process to be reintroduced, making it difficult to move in and out freely.
This division in Bitcoin could lead to differing liquidity, usability, and market perceptions between the two categories.
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31 sats \ 1 reply \ @freetx 27 Feb
This has been talked about for awhile, I think they will have practical problems implementing this. Sooner or later all money would be tainted...and banks would effectively cut themselves off.
I think they will pick some number of hops and not investigate beyond that.
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31 sats \ 0 replies \ @Winitober 27 Feb
I don’t think it will be as easy as you assume. In my opinion, the future of Bitcoin will be driven by large institutional players, with transactions occurring primarily between corporations, family firms, and nation-states. The average person may be lucky to experience an on-chain transaction even once in their lifetime.
Above the base layer, networks like Lightning will be deeply interconnected with Fedimints. These Fedimints will function as community hubs and brokers, facilitating transactions between businesses (e.g., local pubs, retailers) and the public. If you want to make a purchase using 'Bitcoin,' you’ll likely need to join a Fedimint that has an established relationship with the business.
Over time, these Fedimints will be dominated by large entities capable of acting as financial intermediaries. I expect major players such as StrategyB, JPMorgan, Visa, and others to operate some of these large-scale Fedimints. These larger mints will, in turn, maintain relationships with smaller, community-driven mints (e.g., HOAs, clubs, and niche organizations), creating a layered network of trust and liquidity.
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