Regulation and Taxation of Bitcoin and Cryptocurrencies could hurt the countries doing the Regulation

State Actors need to very careful to not throw out the baby with the bath water. New disruptive technologies develop in unpredictable ways. As such these innovations can be the foundation to major industrial revolutions. IMHO Bitcoin is at the center of Artificial Intelligence and robotics (I consider self driving cars robots). Software technology such as Bitcoin is highly mobile and can be developed anywhere there is a favorable economic climate, which include regulation and taxation. Those countries who understand this will prosper and those who don’t will still see legacy business dis-intermediated with out the positive economic benefit.

We are already seeing Wall Street understand this. Goldman Sachs has purchased Poloniex through an entity. JPM, BAC, and GS have stated in 10K’s that Bitcoin and Cryptocurrencies are material threats to their businesses.

Financial institutions are not stupid, they see the money being made by these exchanges today and will want into the game.

I believe with in the next couple of years major Banks all over the world will own Crypto Currency exchanges. Further, I expect them to be mining Crypto currencies. And with in 10 years we will trade all kinds of securities/stocks the way we trade bitcoin/Cryptocurrencies today. We will take self custody of our securities and have instant settlement. We used to self custody with paper stock certificates not that long ago. Controlling our private keys will only make the system more robust after we have seen the likes of MF Global and Lehman Brothers.

We have already seen the advent of the sharing economy with UBER and AirBNB. Micro-payments will dramatically enlarge those markets. The capability of Micro-Payments, firctionless and instant, will create new and bigger markets for sellers of subscription of services to buyers who were previously priced out of the market.

I am a consultant in this space and believe we are just in the very early stages of another information revolution.