"..the more they regulate, the harder we will comply. We will comply and we won't stop complying until the state has been defeated and Bitcoiners have the government's full permission to use and spend Bitcoin."
The above is a quote is an excerpt from a speech written and prepared by the Bitcoin Policy Institute for regulated, KYC compliant Bitcoin exchanges facing increasing pressure from customers to protect them from onerous state reporting and compliance requirements. The message these companies are trying to communicate is clear. "We hear you. We see you. The Chainanalysis analysts see you. And we're going to comply as hard as we can until you finally receive the permission you deserve."
As Bitcoin companies didn't have enough to deal with trying to weather the volatility, stress, and euphoria of the bull market, they must now navigate the increasingly burdensome regulatory requirements passed by legislators in the wake of the FTX collapse. But they're not letting that stop them from doing what's right, in their eyes. "We owe it to our customers and to Bitcoiners to comply as closely as we possibly can with state, federal, and international laws." The CEO of a U.S. based KYC Bitcoin exchange told The Bugle. "If we screw up and underreport customer profits to the IRS or potential money laundering activity the state could very well shut us down. If we get shut down then people can't get Bitcoin. It's that simple." The CEO explained.
All the CEOs we spoke to about this campaign were in agreement that the mission is to defeat the state and the clearest path to victory is compliance. "Once they see how hard we comply, they're going to be impressed. In fact, they're going to be intimidated. It's very difficult to comply as hard as we're complying. I don't even think Congress or the Pentagon could comply this hard if they made it their only goal. We're gaining a lot of respect in the IRS, FinCEN, and the halls of Congress. The harder we comply the more money we are able to make and the more money we are able to make the more money we can donate to the state to ultimately defeat them." Said the CFO of CashApp.
Not all customers are convinced this approach is will be effective. "How they hell is compliance supposed to defeat the state?" One Bitcoin investor posted on X last week. It's a question that, so far, none of the Bitcoin companies, the Bitcoin Policy Institute, or Dennis Porter can answer. In fact, they haven't even tried. Questions like this often earn social media users a mute or a block. Some disillusioned users have migrated to non-compliant, p2p Bitcoin exchanges instead. While users' privacy is protected by using services such as Bisq, liquidity is hard to come by and wait times can be as long as a week for transactions to settle. Some users don't have the time and patience to use them.
Even those who are skeptical of the compliance friendly approach of regulated exchanges have given up, for now. One user told The Bugle, "I appreciate privacy and sovereignty but the thing I appreciate most is easy and convenient." Based on the demand for KYC Bitcoin, it appears this user is not alone. Time will tell if compliance is the solution to defeating the state. Until then, companies are leaning in and when the state says comply, their first response is, "how hard?"