Recently, the founder of Samsung Electronics made a bad choice. The current vice-president, Lee Jae-Yong, is now facing a potential 12 years in prison and is father, Lee Kun, is now also under fire. According to a local newspaper, the two are facing massive fines for having hid billions of dollars in an offshore bank account to avoid paying taxes.
But, would things have been the same if he would have placed the money in a single Bitcoin or Monero account, instead of spreading it across 200 separate offshore accounts?
Bitcoin: Anonymity and Financial Freedom
According to information released by JTBC, a South Korean news agency, the richest man in the country had frequently been withdrawing money from his offshore accounts up until 2011. The problem is that he never declared these transactions to either the South Korean government or their tax department.
Earlier this year, billionaire Prince Alwaleed Bin Tala had trouble with his own Saudi government. They had accused him of corruption, money laundering and tax evasion. Prince Talal was placed under house arrest and had to pay $7 billion to the government for his release.
Max Keizer, a reputable financial analyst, has been severely criticizing Prince Talal for being one of the many people who have described Bitcoin as nothing but a bubble. However, barely a few months after his statement, the Saudi government asked Talal to hand over most of his earnings in exchange for his freedom. However, the whole situation could have been avoiding if he had placed his fortune in a safe, decentralized system like Bitcoin.
Unfortunately for Talal, he was convinced that Bitcoin was a bad idea because it was not tied to any government or central banking authority. Ironically, these same institutions are the ones who collected his fortune, which could have totally been avoided if he had placed his money in cryptocurrency.
According to a speculative hedge fund specialist, Ari Paul, Bitcoin can better handle offshore banking that financial institutions like JP Morgan. He says that big bankers like Jamie Dimon, executive director of JP Morgan, see Bitcoin as a threat because it can infiltrate and disturb the trillion-dollar market that is already in place.
As a decentralized currency and a tax haven, Bitcoin offers a certain level of financial freedom, independence and anonymity that offshore accounts can’t. This is because offshore accounts rely on intermediaries and other service providers that are tied to governments. This is one reason that explains the recent demand for Bitcoin from investors and once tax advisers integrate it into their routines, cryptocurrencies are sure to see their values soar even more.
Bitcoin’s Major Competitor
Many analysts believe that the price of Bitcoin could exceed $100,000 and maybe even $300,000 by the end of 2018 and could become a safe haven much like Gold.
However, it should be known that the market for offshore banking is about five times larger than that of gold. Which is exactly why Ari Paul believes that offshore banking is Bitcoin’s biggest competitor.
Bitcoin Under Scrutiny from Public Authorities
Despite its decentralization, Bitcoin has been brought to the attention of many country’s governments around the world. Not long ago, US authorities asked Coinbase, one of the largest cryptocurrency trading platforms to release the names of its users. In Europe, many countries are working to mobilize legal framework around the cryptocurrency market and France has made it clear to bring the subject up for discussion at the next G20 summit in Argentina.