Is the US Government Trying to Prevent Americans from buying Bitcoins?

The bitcoin exchange market is already thriving, and considering that in September of last year, a U.S. federal judge ruled that, “Bitcoins are funds within the plain meaning of that term”. Many countries are taking steps to incorporate bitcoin exchange into their economy.

However, in the United States, there currently are capital controls and a “foreign account tax compliance act”, discouraging banks from servicing Americans who deal with bitcoin exchanges overseas as well as resorting to legal action to drop clients who do so. 

No exchange outside of the US will accept Americans as clients. They’ll accept North Koreans, Chinese, Indians, Russians, but not Americans. And due to all the regulations, it is incredibly hard to operate a bitcoin exchange in the U.S.

Until recently there was only one option, Coinbase. To be fair to them, a lot of issues with the exchange are due to the myriad of rules and regulation enforced in the US and no the company itself. This has led to countless complaints about how difficult it is to open an account n Coinbase, many even saying that it’s as difficult as opening a bank account; which usually requires a stack of documents. There have also been countless reports of Coinbase closing accounts without reasons or notice, and reports of their banks closing their accounts when they noticed they were doing business with Coinbase.

Matters were made worse, when late last year, the IRS requested a John Doe summons as part of the Bitcoin extortion evasion probe seeking to identify all Coinbase users in the US who ‘conducted transactions in a convertible virtual currency’. 

The US federal government is currently pushing a bill called “Combatting money laundering, terrorist financing and counterfeiting act 2017.” This bill takes a further step to target bitcoin and wants to put any business which issues cryptocurrency under this umbrella of anti money laundering regulations. 

As you can see, trying to do anything related to bitcoin in the United States of America is seemingly increasingly difficult.  This combined with the SEC turning down a bitcoin ETF has ensured that many Americans missed out on massive gains in the rise of Bitcoin in the last year.