[PART 2] Major “crypto” bills passed in Washington DC today. Here’s a quick rundown

00:02 All right, part two. Sorry about the 00:04 two-part video here. Okay, so we covered 00:06 the Stablecoin Act, which is a Genius 00:08 Act. We covered the uh Clarity Act, 00:11 which is rules of the road for other 00:12 cryptocurrencies other than Bitcoin 00:14 because Bitcoin already has clear rules 00:16 rules of the road. And then the third 00:18 piece of legislation was the anti- 00:19 central bank digital currency, CBDC 00:22 legislation, which passed which bans the 00:24 United States from ever issuing a 00:26 central bank digital currency. As I was 00:28 saying, the CBDC's are actually quite 00:29 terrifying. There's one in China, for 00:31 example, and it's programmable money 00:33 where the government does the 00:34 programming. So, the Bank of 00:36 International Settlements, the BIS, 00:38 which is the central bank of central 00:40 bankers, uh, uh, is basically real high 00:44 on CBDC's because of the programmability 00:46 of the money, specifically the ability 00:48 to take money from people's accounts 00:49 without their permission or to decrease 00:52 the value of their accounts. So the 00:54 European Central Bank and the Bank of 00:56 International Settlements are on record 00:58 saying that the great thing about 01:01 central bank digital currencies is that 01:03 if they want to stimulate the economy 01:05 with other people's money, they can put 01:07 a, you know, programmatic code on the 01:09 money that says basically everybody's 01:11 bank account has to drop by at least 5% 01:14 per month. Otherwise, they'll they'll 01:16 confiscate the money and basically just 01:18 shrink it and it'll go poof. Um, that's 01:21 obviously terrifying because the money 01:22 in your bank account should be yours and 01:24 no government should have the ability to 01:26 decide arbitrarily that they don't like 01:28 how you are spending or investing your 01:30 money and be able to manipulate it or 01:33 confiscate it with the push of a button. 01:35 At least here in the United States, if 01:36 the government wants to take your money, 01:38 generally uh for most of the time in 01:40 most situations, they have to tax it 01:42 away from you or they have to bribe you 01:44 into giving it up by offering interest 01:47 on US Treasury bonds or you know 01:50 government debt or whatever. Uh so 01:52 central banks, digital currencies, 01:54 CBDC's are terrifying, ridiculous, 01:57 stupid, and a bad idea. And as of the 02:01 anti-CBDC 02:03 law that passed today, the United States 02:06 will not have will never have a central 02:08 bank digital currency. So that's great. 02:10 Now the good news is where they have 02:12 rolled out CBDC's like in China and 02:15 other places where they have pilot 02:16 programs going, basically nobody wants 02:18 it. Nobody wants the government to 02:20 control and be able to confiscate with 02:23 the push of a button their purchasing 02:24 power. So the government obviously 02:26 already has that ability by printing 02:28 more money and devaluing everybody's 02:30 money. But a central bank digital 02:31 currency could uh take it to a whole new 02:33 level. For example, they could decide 02:36 that if you make certain purchases with 02:38 your money that they will automatically 02:40 deduct a certain amount. So with a 02:42 central bank digital currency, if they 02:44 saw, for example, a transaction go 02:46 through for a gun owner, you know, for 02:48 gun ownership, they could immediately 02:50 subtract 25% of your balance. It's 02:52 ridiculous stuff like that. But it 02:53 doesn't matter in the United States 02:55 because the central bank digital 02:56 currency uh anti-bill, the bill that 02:59 bans it passed in Washington DC today. 03:02 Meaning we will not have a central bank 03:03 digital currency and we don't have to 03:05 worry about that. We can just focus on 03:07 Bitcoin. Okay. So what effect does any 03:10 of these bills have on Bitcoin? One, the 03:13 Genius Act, the stable coin bill does 03:15 make it easier for people to have stable 03:17 coins, which is one step away from 03:19 Bitcoin. Obviously, it's a a stable coin 03:21 goes up and down. Well, never up, always 03:24 down with the value of the US dollar. 03:26 Um, so it's a bad investment because 03:28 it's never more valuable than one US 03:29 dollar, but it does get you one button 03:32 click away from buying Bitcoin as 03:34 opposed to the hurdles you have to jump 03:36 through to convert US dollars in their 03:37 current form. Uh, so the stable coin 03:40 bill is generally good for Bitcoin 03:42 because it just moves people closer to 03:44 Bitcoin. The Clarity Act uh should give 03:48 institutions and Wall Street greater com 03:50 comfort around Bitcoin even though it 03:53 doesn't directly affect Bitcoin because 03:54 Bitcoin has had clarity for a long time. 03:56 Most most people on uh Wall Street don't 03:60 realize that. So if you ask the average 04:02 investment professional about Bitcoin, 04:04 they will say something like, "Well, I 04:05 just feel like there's not clear rules 04:07 of the road." Well, that's just 04:08 ignorance. They don't realize that there 04:10 has been clear clear rules of the road 04:12 for Bitcoin for a long time. And the 04:14 clarity act now will send the the 04:17 message to the you know to the world 04:20 that there are clear rules of the road 04:22 for cryptocurrency and bitcoin will 04:24 benefit from that even though it has had 04:26 clear rules of the road for a while now. 04:28 Okay. Um the two pieces that have not 04:32 been passed. Oh, and the anti-entral 04:34 bank digital currency bill is good for 04:36 Bitcoin because we don't have to deal 04:37 with a central bank digital currency. So 04:40 um the I guess uh two pieces that have 04:44 not passed are the uh Bitcoin strategic 04:47 reserve. So the United States owns some 04:49 Bitcoin mostly or entirely from 04:52 confiscations that they have done in the 04:54 past. And there's a bill to uh we 04:57 already have a uh a Bitcoin strategic 05:01 reserve as a result of executive order, 05:03 but that can be rescended with another 05:04 executive order. So, there's an effort 05:06 to pass a bill creating a strategic 05:08 Bitcoin reserve. So, it's not just 05:11 protected by a um an executive order 05:13 from the president. It has an actual act 05:16 of Congress behind it. So, there's an 05:17 effort to do that, which would include 05:19 the US government buying a substantial 05:22 amount of Bitcoin, which would obviously 05:24 make the price go up, but it was also 05:25 hopefully set off an arms race with 05:27 other countries of everybody 05:28 accumulating Bitcoin. Now, I'm sort of 05:30 ambivalent on this point. the more 05:32 governments adopt Bitcoin, you know, the 05:35 the more they're on the side of the 05:37 Bitcoiners like me. So, the upside of 05:40 the government buying Bitcoin is I'd 05:42 rather be in the same boat with somebody 05:44 who owns Bitcoin instead of me owning 05:46 Bitcoin, the government not owning 05:48 Bitcoin, and the government not liking 05:49 that I own Bitcoin. So, I like the fact 05:51 that me and the government are on the 05:53 same boat if the government's buying 05:54 Bitcoin and I am, but I'm not a fan of 05:56 government. Uh the government screws up 05:59 basically everything it touches. the 06:01 government uh and I served obviously for 06:02 eight years in the House of 06:03 Representatives here in Mississippi in 06:05 the state legislature and I'm just not a 06:07 fan of government. I think the 06:08 government is awful. The incentives are 06:10 bad. The government almost never does 06:12 anything good and generally I don't want 06:14 the government to have more financial 06:16 resources. I want people to have more 06:18 financial resources. I don't want 06:20 governments to have more financial 06:21 resources. So, do I want the government 06:23 buying up a bunch of Bitcoin? Not 06:25 really. because I would rather all of 06:27 the people own all the Bitcoin rather 06:29 than the government sitting on it. Uh 06:31 now obviously the government's not going 06:33 to buy up all the Bitcoin cuz it can't. 06:35 Um the price would go, you know, into 06:38 infinity and beyond if the government 06:40 started trying to buy up all the 06:41 Bitcoin. But even if the the most they 06:43 can ever buy up is 1% or two 2% 3% 5% 06:47 something like that. uh which is 06:49 possible. The US government could 06:50 certainly buy up two 2% 3% 5% of all the 06:53 Bitcoin and that would probably send the 06:55 price to, you know, a million dollars in 06:57 a hurry. Um that's going to leave behind 06:59 the 95% of people who do not yet own any 07:01 Bitcoin. And I would rather have all of 07:03 those people own Bitcoin, uh rather than 07:06 just the government hoovering it all up. 07:08 Um so I'm sort of ambivalent. I guess 07:10 I'd rather the government buy I'd rather 07:13 have a strategic Bitcoin reserve versus 07:15 not uh because it puts me and the 07:17 government on the same page. But again, 07:19 I'm just not a fan of the government 07:20 owning a bunch of Bitcoin. I would 07:22 rather the people own the best money in 07:24 the world and the government be stuck 07:26 with its useless printed out of thin air 07:28 trash that they took off the gold 07:30 standard and they deserve to have it 07:32 lose money because it's their fault. 07:34 They're the ones who messed it up. So, 07:36 uh anyway, so uh so that's the quick 07:39 rundown. The other piece missing is uh a 07:42 bill around taxes. Uh there's a uh 07:45 currently Bitcoin miners are double 07:47 taxed. Uh I won't go into the nuances of 07:49 it other than to say it's a a fluke with 07:52 taxes that does not affect people like 07:53 you and I, but it does affect people 07:55 running Bitcoin mining computers, which 07:58 is not something you need to mess with 07:59 because it's a very very very difficult 08:01 to make money in Bitcoin mining. I don't 08:04 recommend it. So you don't have to worry 08:06 about it. But it is there is a a need to 08:09 make it more fair and it would be more 08:11 fair if they fixed the double taxation 08:14 problem of Bitcoin mining. Um, okay. And 08:17 then the last piece which is by far by 08:19 far by far by far the most important and 08:22 would likely be be uh paired with a fix 08:25 for taxation for Bitcoin mining is a 08:28 dimminimous meaning a small amount. the 08:30 word dimminimus. D m i n i mus I think. 08:34 Deminimus, however you say, however you 08:36 uh spell it. A dimminimous exemption for 08:39 Bitcoin purchases uh to exempt them from 08:42 capital gains taxation. And the way that 08:45 works is right now if you sell Bitcoin 08:48 or if you buy a cup of coffee with 08:50 Bitcoin, you are supposed to pay capital 08:52 gains tax on the value increase of the 08:54 Bitcoin. So, if you buy Bitcoin when 08:57 it's $70,000 per coin for $5, and then 09:02 you sell it when it's $140,000 per coin, 09:05 which is 100% increase, and your $5 has 09:08 turned into $10, and then you use $10 at 09:11 Starbucks, you're supposed to pay 09:12 capital gains tax on the $5 increase. 09:15 You do not pay capital gains tax on the 09:18 full amount. you only pay capital gains 09:20 tax on the increase in the value that 09:23 happened while you held it. Um, and for 09:25 a variety of reasons I've covered 09:27 elsewhere on Facebook, uh, the way 09:30 taxation handles with Bitcoin is 09:32 actually surprisingly efficient, meaning 09:34 the amount of, uh, tax you pay is 09:37 actually quite low by comparison for a 09:40 bunch of reasons I go into in other 09:41 videos and other posts. Uh, but 09:44 regardless, um, it's a huge pain. So 09:47 most people do not feel comfortable 09:48 spending Bitcoin in the real world 09:51 because they do not want to worry about 09:53 taxes on a $5 coffee purchase etc. So 09:58 the the conversation in Washington right 10:00 now is and I don't know that it has 10:02 enough political support to happen. I 10:04 certainly hope it does is a dimminimous 10:06 exemption which in its ideal form would 10:09 look like any purchases under $600. Uh, 10:12 so most I think the most I've ever paid 10:14 for groceries is $472 at Costco. So 10:19 under 600 would basically cover pretty 10:21 much any grocery run, Costco run, uh, 10:24 etc. You would be able to spend Bitcoin 10:27 and have it be exempted from capital 10:29 gains tax. So if you buy Bitcoin, sit on 10:32 it for a few years, it doubles in value, 10:34 you use it to buy groceries, as long as 10:36 the total bill was less than $600, it 10:39 would be exempted from capital gains 10:41 taxation, which would mean 10:42 cryptocurrency platforms would not even 10:44 have to track it, which would make it 10:46 much easier to uh implement Bitcoin into 10:50 Cash App. Uh well, Cash App already has 10:52 it, but I should say Google Pay and 10:54 Apple Pay would be the big ones. Uh 10:56 right now a major reason that Google Pay 10:58 and Apple Pay do not have uh uh do not 11:02 have Bitcoin included is because they 11:04 don't want to deal with capital gains 11:06 tax and helping people keep up with all 11:08 that uh for small purchases. But if 11:11 there's a $600 exemption to exempt 11:14 purchases under $600 from capital gains 11:16 tax, then any of the consumer financial 11:19 uh apps would have a much easier time 11:22 enabling you to pay for anything with 11:23 Bitcoin up to $600. And most of them 11:26 would probably as a result uh make you 11:28 you know make it clear that hey you know 11:31 if you keep your purchases under $600 11:33 this is sort of simple and 11:34 straightforward. If it goes above $600 11:37 this gets a lot more complicated. But 11:38 that would be amazing to be able to save 11:41 in Bitcoin and spend I mean virtually 11:43 every expense in my life uh other than 11:46 the payment on my Tesla which I've 11:48 covered in another video. Uh virtually 11:50 all of my payments and utilities are 11:52 under $600. And if I could pay with all 11:55 of those with appreciated Bitcoin, uh, 11:58 that would be absolutely amazing and it 12:00 would be amazing. So, the number one 12:02 thing I've ever wanted from Washington 12:05 DC on Bitcoin is an exemption on capital 12:08 gains for small purchases. And hopefully 12:13 that will be in the cards. Um, so we'll 12:16 see. But that is that is the big one. uh 12:18 all this other stuff has been a lot 12:21 bigger deal for other people uh in 12:23 crypto that are doing things that are 12:25 not Bitcoin etc. the one that would have 12:27 the biggest profound effect for 12:28 Bitcoiners with regard to the 12:30 dimminimous exemption from capital gains 12:32 taxation, ideally under $600. And if 12:35 they let me write the bill, obviously 12:37 I'm not in federal government Washington 12:40 DC. If they let me write it, I would 12:42 write it $600 in Bitcoin terms like 0.00 12:46 however much Bitcoin, actual Bitcoin, 12:49 like what is that? 0.006 Bitcoin or 12:51 whatever that ends up being 05 Bitcoin. 12:54 Which means as the price of Bitcoin went 12:57 from being worth $600 of Bitcoin down. 13:00 So if the dimminimous exemption was in 13:03 the form of Bitcoin like 0.005 Bitcoin, 13:06 then as 0.5 Bitcoin went from being 13:09 worth $600 to $6,000 between now when 13:14 when Bitcoin hits a million, that would 13:16 be absolutely amazing. So uh that's a 13:19 bridge too far. I'm sure I think there's 13:21 less than a onetenth of 1% chance that 13:24 we will get a dimminimous exemption that 13:26 is denominated in Bitcoin. That would be 13:28 the absolute holy grail because that 13:31 meant the $600 dimminimous exemption 13:34 would rise with the value of Bitcoin. 13:35 But regardless, even if all we get is a 13:37 $600 dimminimous exemption, uh that 13:40 would be an absolute gamecher for the 13:42 ability to use Bitcoin in the real 13:44 world. And if that was indexed to 13:46 inflation, obviously that's not nearly 13:48 as good as indexing it to an amount of 13:50 Bitcoin. That would be infinitely 13:52 better. But even if it was uh indexed to 13:55 fiat government US dollar inflation, 13:58 that would still mean the $600 exemption 14:00 climb to, you know, $65, $610, $625 over 14:05 time, which is still better. Uh but 14:07 anyway, so hopefully my my hope and wish 14:10 and everything is that we get a 14:13 dimminimous exemption under $600 or 14:15 ideally under 0.005 Bitcoin. That would 14:19 be an absolute gamecher and would 14:21 radically increase the incentive for 14:23 people to use Bitcoin to buy stuff 14:25 because you basically get it all of your 14:27 gains taxree if you're buying stuff of 14:29 Bitcoin, which would be absolutely 14:31 amazing. But anyway, so uh that is my 14:34 hope, that is my prayer, that is my wish 14:36 is that we get the $600, ideally 0005 14:40 Bitcoin exemption uh in Washington DC 14:43 and that is the one big missing piece uh 14:46 that is still on the table. Obviously 14:48 there's the double taxation of Bitcoin 14:49 miners which is not something I really 14:51 care about although you know it's 14:53 important it's just low on my list. Uh 14:55 and then there's the Bitcoin strategic 14:57 reserve having that c codified in 15:00 legislation rather than just by 15:03 executive order. That is, you know, 15:05 important. But if I could only have one 15:06 thing, one thing in all of this, you 15:09 know, stuff, the Clarity Act, the Genius 15:11 Act, the anti-CBDC act, uh probably the 15:15 thing I value most would be a 15:16 dimminimous exemption for Bitcoin. Maybe 15:19 second on that list would be the 15:20 anti-CBDC bill, which is important. Uh 15:23 but anyway, we might get it all. 15:25 Hopefully in the weeks ahead, we will 15:27 get all of it, which would be pretty 15:28 fantastic. And I'm just hoping, praying, 15:31 wishing, thinking, wow, if we could get 15:33 that dimminimous exemption for capital 15:35 gains tax, everyone would start using 15:38 Bitcoin for everything. Not only because 15:40 there'd be no tax headaches, but because 15:42 it'd be the most efficient way to 15:44 benefit from Bitcoin is to buy Bitcoin, 15:47 wait for it to appreciate, and then 15:48 spend it in increments of less than 15:50 $600, which would not only let you live 15:53 life at a discount because your Bitcoin 15:55 is increasing, but you're also living 15:57 life at a effectively tax-free because 16:01 as long as you're spending it in 16:02 increments of $600 or less, then all of 16:04 the gains on your Bitcoin would be 16:06 exempt from taxation, which would be 16:08 absolutely Absolutely fabulous in every 16:10 way. So, that's the rundown on all of 16:11 that. Let me know if you have questions. 16:13 Exciting times ahead. Thank you 16:15 everyone.