Would you renounce your US Citizenship to avoid SEC regulation?
The SEC recently announced that they are putting the ICO industry on notice. In my opinion based on who is in charge of the SEC at this time and the current priorities of the SEC and other law enforcement agencies (some of which may be triggered by the Russian election hacking scandal), we are about to enter into a regulatory crackdown. This upcoming crackdown by the SEC, DEA, FBI, IRS, Secret Service and others will dramatically increase regulatory risk on developers and possibly even users of cryptocurrency.
Considering the opportunity of a lifetime that exists in this space for those who successfully do an ICO, and consider the increased cost of participation (and new barriers to entry for US citizens such as being an accredited investor), the motivation now may exist for many US citizens to follow in the footsteps of Roger Ver and renounce US citizenship.
Why renounce US citizenship?
The SEC exists to enforce against or regular for the US Citizen. I am not aware of any legal mechanism which a US citizen can take to reject "protection" from the SEC. So a US citizen has to worry about the impossible legal landscape, regulatory risk, tax landscape, all which add up to reducing the competitiveness of the average US citizen. US citizens who are not millionaires already (accredited investors) and who aren't lawyers or accountants, are now faced with impossible circumstances where they are expected to compete while legally handicapped by the SEC, and heavily taxed by the IRS.
The evidence for an upcoming crackdown is adding up
Looking only at the data and open source intel emitted from news articles I can see clear indication that a crackdown is incoming. The first piece of evidence is circumstantial but consider Stephanie Avakian who is the new co-director along Steven Peikin with of enforcement at the SEC who specifically stated: "The greatest threat to our markets right now is the cyber threat,".
While we can say this is particularly vague, this article combined with the latest notice by the SEC shows the SEC is now focusing it's attention on cyber markets and cyber threats. This is a risk indicator for developers who can now be certain that the SEC is monitoring the space for better or worse. In addition, BTC-E one of the oldest exchanges was just taken down and is a Russian is being accused of money laundering, whilst the IRS is also investigating Coinbase users via the demand for information.
If someone or some ICO offered you millions in tokens would you relinquish your US citizenship?
And now the question for US citizens, what would it take for you to renounce your US citizenship? How much would an ICO or startup have to offer in order to get you to leave everything behind and chase the opportunity of your lifetime? 14,000 users of Coinbase may be effected by the IRS summons which is a lot of people and the threshold amount of money is under $20,000 transactions in a year (buy, sell, send, receive). This means if someone merely sent you $21,000 then you'd be on the list even if it was a gift.
If you will renounce your citizenship then where would you want to go and how much would it take for you to make that decision? If you will never renounce your citizenship then why? This is a question of whether you believe the opportunity cost of being a US citizen outweighs whatever the risks are of losing US citizenship.
References
- http://www.reuters.com/article/us-usa-sec-enforcement-exclusive-idUSKBN18Z2TX
- https://cointelegraph.com/news/forewarned-is-forearmed-key-takeaways-from-sec-dao-report
- https://www.coindesk.com/14000-coinbase-bitcoin-could-be-affected-irs-tax-summons/
- https://www.theverge.com/2017/7/29/16060344/btce-bitcoin-exchange-takedown-mt-gox-theft-law-enforcement
- https://arstechnica.com/tech-policy/2015/01/bitcoin-investor-who-renounced-us-citizenship-now-cant-get-back-in/
Would you renounce your US Citizenship to avoid SEC regulation?
wrong question...
Money has always been used for control... who needs it? After 5000 years of much of the same... who is having delusions/illusions? And the universal basic income supporters are in for a shock too at some point down the road.
That is why I am blogging about a futuristic and money-free society. Money cannot buy security, freedom, love nor time... look back at history objectively and take a red pill
honestly US citizenship is highly overrated anyway.
We are the only country that taxes us on income made outside the US.
denouncing US citizenship, if done correctly can be quite a money saver.
Just make sure you have citizenship somewhere else first.
of course :)
And, if you live "offshore," you can shelter up to $100, 000+ per year (times two if you're a couple) of income earned offshore and are a permanent resident elsewhere. So, be a permanent resident in the country where you intend to get the second citizenship. Once you have the second citizenship, you get the privilege of paying and being harassed to renounce. Ohh..but that's not the end of it. Now you have to wait for the official form, which has been known to take up to twelve months, that officially approves of your renouncement. You'd think they'd just say, "Good riddance!" But, NO...that'd be too easy.
I've been researching internationalization lately. I'm very interested in getting citizenship elsewhere. Multiple places actually. It seems you have to either live there or pay their government a lot to do it but it really seems worth it.
Nice post
what is actually nice in that post? Wondering... I see only very bad news
LMAO, I like you.
I would give up my citizenship for unrestricted access to crypto. Any day.
To me it would depend on what the ICO was all about, would have to be something good. Once you renounce your citizenship, you get put on a list I'm sure.
Yeah...a list of people who finally woke up and got smart. I know a number of people who renounced and only one has had trouble re-entering the US to visit family. Does that one individual have any regrets, NOPE! It was "the biggest relief of my life" to quote him. And, strangely, his profits from investments and businesses have risen.
Just buy 'em and ignore the #SECriminals!
The SEC is not the only reason that I would renounce my citizenship. There's a whole lot of other three-letter reasons to do so. A project well underway. The "land of the free" to be tyrannized is more appropriate today.
Don't forget to mention the "exit" taxes that you'll be required to pay if you renounce your US citizenship, because they're very interested in shafting you once more for the road.