Online Cash Bitcoin Could Challenge Governments, Banks

mirimir · Jan 31, 2014

ronjor said:

Check out the links in the article. Dry, but informative.
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Yes, indeed, that's excellent counsel

In her remarks, Ms. Calvery justifies in great detail FinCEN's expectations for active cooperation from financial institutions in enforcing Anti-Money Laundering Laws (AML). I'm struck by the similarity to the NSA's expectations for cooperation from the communications sector. And although FinCEN apparently doesn't hack financial institutions, they probably have an NSA feed

Although the boilerplate letter "Application of FinCEN’s Regulations to Virtual Currency Mining Operations" specifically concerns Bitcoin miners, it does generally distinguish between administrators/exchangers and users:

How a user obtains a virtual currency may be described using any number of other terms, such as “earning,” “harvesting,” “mining,” “creating,” “auto-generating,” “manufacturing,” or “purchasing,” depending on the details of the specific virtual currency model involved. The guidance makes clear that an administrator or exchanger of convertible virtual currencies that (1) accepts and transmits a convertible virtual currency or (2) buys or sells convertible virtual currency in exchange for currency of legal tender or another convertible virtual currency for any reason (including when intermediating between a user and a seller of goods or services the user is purchasing on the user’s behalf) is a money transmitter under FinCEN's regulations, unless a limitation to or exemption from the definition applies to the person. The guidance also makes clear that “a user who obtains convertible virtual currency and uses it to purchase real or virtual goods or services is not an MSB under FinCEN's regulations.” ...

The label applied to a particular process of obtaining a virtual currency is not material to the legal characterization under the BSA of the process or of the person engaging in the process to send that virtual currency or its equivalent value to any other person or place. What is material to the conclusion that a person is not an MSB is not the mechanism by which a person obtains the convertible virtual currency, but what the person uses the convertible virtual currency for, and for whose benefit.
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The next paragraph does focus on miners:

To the extent that a user mines Bitcoin and uses the Bitcoin solely for the user’s own purposes and not for the benefit of another, the user is not an MSB under FinCEN’s regulations , because these activities involve neither “acceptance” nor “transmission” of the convertible virtual currency and are not the transmission of funds within the meaning of the Rule. This is the case whether the user mining and using the Bitcoin is an individual or a corporation, and whether the user is purchasing goods or services for the user’s own use, paying debts previously incurred in the ordinary course of business, or (in the case of a corporate user) making distributions to shareholders. Activities that, in and of themselves, do not constitute accepting and transmitting currency, funds or the value of funds, are activities that do not fit within the definition of “money transmission services” and therefore are not subject to FinCEN’s registration, reporting, and recordkeeping regulations for MSBs.
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Even so, it's my reading that corporate persons are considered to be "users" as long as they are "purchasing goods or services for ... [their] own use, paying debts previously incurred in the ordinary course of business, or ... making distributions to shareholders."

That is very encouraging.

lotuseclat79 · Feb 1, 2014

Feds: If you mine or trade Bitcoin on your own, that’s totally cool.

US financial rules say that individual Bitcoiners aren't "money transmitters."
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-- Tom

lotuseclat79 · Feb 1, 2014

BITCOIN: How It Works, And Why It Could One Day Threaten Legacy Payments Tools Like Credit Cards.

-- Tom

lotuseclat79 · Feb 2, 2014

Bitcoin’s Emerging Price Stability.

-- Tom

lotuseclat79 · Feb 4, 2014

Not actually capped at 100 Billion?.

Dogecoin decides to allow annual inflation of 5 billion coins each year, forever.

Dogecoin to allow annual inflation of 5 billion coins each year, forever.

"wow such advice much truth;" developers to counter deflationary pressure.
Click to expand...

-- Tom

lotuseclat79 · Feb 2, 2014

Bitcoins the hard way: Using the raw Bitcoin protocol.

-- Tom

Mrkvonic · Feb 3, 2014

The future of Bitcoin

Here's a rather serious article about the Bitcoin, a peer-to-peer digital cryptocurrency technology and its future use, covering definition, market availability, gold and stock market comparisons, ease of use, problems and possible inherent limitations, alternatives, and more. Worth taking a look, I guess.

http://www.dedoimedo.com/computers/bitcoin-future.html

Cheers,
Mrk

mirimir · Feb 3, 2014

Re: The future of Bitcoin

Mrkvonic said:

Here's a rather serious article about the Bitcoin, a peer-to-peer digital cryptocurrency technology and its future use, covering definition, market availability, gold and stock market comparisons, ease of use, problems and possible inherent limitations, alternatives, and more. Worth taking a look, I guess.
Click to expand...

OK, but it's all about investing.

Although fortunes have (and will be) made and lost in Bitcoin speculation, the focus on investment misses the point. Bitcoin (and its descendants) enable global payments with very low transaction costs. That is, Bitcoin etc are perfect for micropayments, and there are many very useful applications for micropayments.

With appropriate care, Bitcoin etc are also great for anonymous payments, but that will be a relatively minor use, just as it is now for cash aka paper money.

lotuseclat79 · Feb 4, 2014

Re: The future of Bitcoin

Interview with Andreas Antonopoulos, bitcoin entrepreneur. (Video)

The Joe Rogan Experience podcast episode #446 has a long and informative interview with Andreas Antonopoulos, a bitcoin expert who does a good job of explaining how the bitcoin money platform works and why "trust by computation" is a lot better than trusting banks (like drug cartel money launderer HSBC) and the federal reserve (which basically gives free money to the rich people who own the banks).
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-- Tom

lotuseclat79 · Feb 4, 2014

Re: The future of Bitcoin

We Went Inside The Raucous Bitcoin Trading Pit That Sits In The Shadow Of The New York Stock Exchange.

-- Tom

lotuseclat79 · Feb 4, 2014

Re: The future of Bitcoin

How To Turn Your Starbucks Gift Card Into Bitcoins You Can Spend Elsewhere.

-- Tom

lotuseclat79 · Feb 4, 2014

Re: The future of Bitcoin

Bitcoin Price Tags Bring Cryptocurrencies to the High Street.

-- Tom

lotuseclat79 · Feb 4, 2014

Re: The future of Bitcoin

Why Are Bitcoiners Going to Jail for Money Laundering While Big Banks Walk?.

-- Tom

lotuseclat79 · Feb 4, 2014

Re: The future of Bitcoin

Only Your Heartbeat Can Unlock This Bitcoin Wallet.

-- Tom

lotuseclat79 · Feb 4, 2014

Re: The future of Bitcoin

Dogecoin developers to counter deflationary pressure.

-- Tom

lotuseclat79 · Feb 5, 2014

Re: The future of Bitcoin

The coin prince: inside Bitcoin's first big money-laundering scandal.

What last week’s arrest of Charlie Shrem means for the virtual currency
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-- Tom

lotuseclat79 · Feb 5, 2014

Re: The future of Bitcoin

Bitcoin Is the Latest Plot to Save the Post Office.

-- Tom

lotuseclat79 · Feb 5, 2014

Re: The future of Bitcoin

EFF Challenges New Jersey Subpoena Issued to MIT Student Bitcoin Developers.

-- Tom

lotuseclat79 · Feb 6, 2014

Re: The future of Bitcoin

New lawsuit against Bitcoin miner manufacturer alleges fraud, negligence.

For months now, Butterfly Labs has faced anger regarding delayed orders.
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-- Tom

lotuseclat79 · Feb 6, 2014

Re: The future of Bitcoin

Bitcoin Is Broken—Here's a Simple Plan to Fix It.

It doesn't work as a currency, but it could help build the financial architecture of web payments. Here's how.
Click to expand...

-- Tom

lotuseclat79 · Feb 6, 2014

Re: The future of Bitcoin

Apple Drops The Most-Popular Bitcoin Wallet From The App Store.

-- Tom

lotuseclat79 · Feb 6, 2014

Re: The future of Bitcoin

Anubis, the God of Dead Bitcoin Miners.

-- Tom

lotuseclat79 · Feb 7, 2014

Re: The future of Bitcoin

Bitcoin sinks after exchange pauses withdrawals.

The virtual currency didn't react well to news that a Japanese exchange had temporarily halted all withdrawal requests.
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-- Tom

lotuseclat79 · Feb 7, 2014

Re: The future of Bitcoin

What's behind Apple's Bitcoin crackdown in the App Store?.

-- Tom

siljaline · Feb 7, 2014

Russia bans bitcoins

If you’re going to the Sochi Olympics in Russia, don’t bring bitcoins. Yesterday the Russian Prosecutor General’s office released a statement that clearly prohibits Russians from using the new digital currency.
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http://www.foxnews.com/tech/2014/02/07/russia-bans-bitcoin/

Bitcoin’s Oldest Exchange, Now in Shambles, Suspends Payouts

It was once the only serious bitcoin exchange on the internet. But now, just a year later, Japan’s Mt. Gox is in shambles.

U.S. regulators have seized more than $5 million of the company’s money. Customers report month-long delays in getting their U.S. dollars out of the exchange. And now a technical glitch has prevented the exchange from paying out in bitcoins too, effectively locking away customer assets until further notice.
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http://www.wired.com/wiredenterprise/2014/02/bitcoins-oldest-exchange/

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