[ubernostrum]

The IRS got Switzerland to open up previously-confidential banking records.

You think they're not going to find a way to identify Bitcoin users? "It's on the internet, that makes it untraceable" is magical thinking that does not survive contact with sufficiently dedicated real-world agencies.

[stale2002]

The IRS got people to give up the identities of other people.

With bitcoin, if you take the right precautions, it is impossible for anyone to know which account is yours.

It is a TECHNICAL solution. It doesn't matter how many people the IRS threaten.

Can the US government tell everyone in the world to think of a random number, then these citizens don't tell anybody what number they chose, and then can the government arrest everyone who chooses the number 10? No, it cannot do this.

And if it can't do that, then it can't arrest all the bitcoin owners.

[ubernostrum]

OK. So buy something with Bitcoin without:

* Ever appearing at a retail establishment with security cameras

* Ever scheduling a product for delivery to any address, period

* Ever scheduling a service to be provided at any location, period

* Ever communicating with the other party via any means whatsoever, including placing an order online, not even via Tor behind seven proxies

And tell me how it goes. Because all of those things above are vectors for identifying you that big random numbers won't solve.

[catuscoti]

Ultimately, all of this assumes that the IRS are willing to prove that they will risk their lives and die for what they believe in. They will not, because they expect the police force to do that, who in turn will not, because they expect the army to do that. And that is how it all went wrong so often in the past.

[ubernostrum]

Why would the IRS need to risk their lives to conduct a legal investigation? If you're caught on a CCTV camera somewhere, they're going to be able to find out about it without getting killed.

And if somebody plans to kill IRS agents, well, that is going to bring out the heavy forces, and will not end well for the tax evader.

[Senji]

>all of this assumes that the IRS are willing to prove that they will risk their lives and die for what they believe in.

Please, they'll just use another branch of the government to disappear some people. It's not like they have any scruples doing that already.

[dragonwriter]

The thing is, unless you use bitcoin to buy goods similarly obscured digital goods (essentially things that exist themselves only as records on a blockhain), the other side of the transaction is traceable.