BERKELEY, Calif. (MarketWatch) — Every so often someone comes up with an alternate, often sketchy currency scheme of some sort. These folks spend all their energy to find a way to rationalize it so the government doesn’t start thinking that it is nothing more than a scheme to cheat the government out of tax money.

I avoid these things like the plague, since I’m convinced that users of these systems will be scrutinized by the IRS and maybe other agencies.

The problem is the 16th Amendment making federal income tax legal. Since its ratification in 1913 and through various periods of abuse when the marginal tax rate went to 70% to 90%, this amendment could have been repealed but never was. Now it’s too late and impractical, so live with it.

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Creating screwball schemes to bypass the system will not work.

The most recent phenomenon is Bitcoin, a convoluted, encrypted monetary unit whose complexity is beyond baffling to the layman. Suffice it to say a lot of people swore by it, until its recent collapse.

The product, which could be used in exchange for goods and service as well as donations to charity, had a street value of as high as $33 per Bitcoin unit. That figure has dropped below $3 as of this writing. It now it appears that the whole system may vanish like the rest of these deals.

You can try and figure out how this system actually works on the wiki page describing the product.

I was skeptical from the beginning, because in the late 1990s two major alternative money schemes appeared. Both died within a few years of their inception.

One was Beenz, which was heavily financed by the likes of Larry Ellison, along with a slew of international venture capitalists.

Beenz was schemed as some sort of point system that could have actual monetary value in some screwy way that bypassed currency laws. Again, sketchy.

I always asked, why I would want to buy something with Beenz when I can use real dollars? What’s the point?

An attempt to go public failed and the company went down soon after 9/11, the bigger dot-com bust and the Y2K fiasco — the triple whammy that we have yet to recover from.

Alongside Beenz was a wackier money scheme called Flooz. It rhymed with “lose.”

This was an alternative currency that claimed to actually be modeled after the long-defunct S&H Green Stamps phenomenon that lasted from the turn of the last century to around 1980.

S&H Green stamps was an old-fashioned customer-loyalty program and was never designed to be any sort of alternative currency. (You should research it if you’ve never heard of it. It’s interesting.)

Flooz lasted about two years after blowing through at least $50 million in VC money. The biggest user of the system seemed to be the Russian mob, which found some way to launder money with the system.

Whoopi Goldberg, of all people, was the spokeswoman for Flooz.

These schemes come and go and Bitcoin looks to be one of many. I admit it would be more interesting if it did not fail and wish them luck. But I personally advise people to stay away from all of these ideas.

Besides, sovereign governments do not like these things no matter how “legal,” and would never allow one to actually succeed. Isn’t it obvious why? Taxes.