In 2013, I attempted to get in on the Crytpo game. I applied for an account at MtGox, which took months to be approved. In February, I wired a substantial sum of money to them the day before they were hacked. Luckily (or maybe unluckily), my bank was able to reverse the wire and recover the funds. Later, I bought into Bitcoin through Coinbase.

My interest in Crypto was as a digital currency, a means of holding and transferring value. I bought into the system in order to participate and share in the experience, but I also was speculating that the value could increase and I wanted to hold the currency early in case it did, but speculative investing was my secondary objective.

I used the Bitcoin for everyday purchases, including frozen yogurt at Mr. Yogato in Washington, D.C., at a food truck in Whitecross Market in London, and at Adam Solar Rides in Pittsburgh. In Whitecross Market, I bought a sandwhich, which was normally priced at £5. It was a joy for me to be able to trade crypto for goods without having to think about ATMs, exchange rate gouging, foreign transaction fees, or leftover change.

That joy was summarily diffused when I learned that the SEC had determined that crypto currency was to be regulated as a security, meaning it should be treated like an investment or stock. This characterization of the currency meant that gains and losses had to be tracked on every transaction, including my yogurt and sandwich purchases.

This regulatory framework required that I choose an accounting strategy (FIFO or LIFO) and to account for each and every trade with the IRS.

As it turned out, that £5 sandwich fell across two lots of Bitcoin that I’d purchased, which meant that single lunch resulted in two separate line items on my tax filing for that year, each with separate tax consequences.

This overreach by the SEC has hobbled Bitcoin and other crypto currencies for casual use. This heavily-regulated approach makes use of crypto an infeasible alternative to cash or legacy payment systems (credit card networks). If the SEC were to treat exchanges of fiat currency (such as USD to GBP), it would similarly raise the cost of small exchanges beyond viability; there would be no airport currency exchanges. The world would not have accepted this position. The only reason it was accepted for crypto currency is because the SEC managed to ruin the system before enough people cared to protest.