Bitcoin Forum

"Forty-eight US states regulate money transmitters although the laws vary from one state to the other.[3] Most of the states[4] require a surety bond with widely ranging amounts from as little as $25,000 to over $1 million and maintaining a minimum capital requirement."

http://en.wikipedia.org/wiki/Money_transmitter


What are the two free states?


Thanks

South Carolina and Wyoming

amirite?

Did you do that just to direct us to an MSB lawyer with virtual currency know-how? http://moneytransmitterlicense.blogspot.com/  :D

Lot of the links are broken. All 50 states listed, so dunno which two don't have MSB laws... Kansas and NY don't seem to have a pinpoint on the state-by-state map...

https://www.paypal-media.com/licenses
Paypal has licenses for everywhere but South Carolina and NY.

So, looking like definitely NY (which seems really, really unlikely - but I guess possible), and either South Carolina or Kansas.

ETA: http://www.shajlaw.com/newyorkmoneyservicebusinesslicense.html Paypal must have some way to get around MSB in NY, but I'm pretty sure I counted 48 states and 2 non-states in PP's list, which'd indicate there's only one state without MSB license requirements.

From map on first page linked:
South Carolina: Currently no regulation
WY and NY definitely have regulation, though.
ETA2: It looks like KS does have MSB requirements, but are apparently very difficult to find :D
ETA3: SC definitely has something on the books... I'm getting tired of combing through bureaucratic crap at this point, though. :)

According to this PDF document prepared by Thomas Brown at UC Berkeley (http://abnk.assembly.ca.gov/sites/abnk.assembly.ca.gov/files/50%20State%20Survey%20-%20MTL%20Licensing%20Requirements(72986803_4).pdf) the two free states are South Carolina and Montana.

Somebody found my cheat sheet!

I don't suppose you would be so kind as to share your opinion on what significance (if any) there is in SC and Montana not having these regulations, as it relates specifically to the Bitcoin legal landscape?

Is this more along the lines of an interesting piece of trivia or something that people who are starting up Bitcoin based businesses should possibly consider when choosing where to operate, incorporate, etc...?

I guess, I don't see any evidence of a whole bunch of current fiat-based institutions locating themselves in these states or anything (please correct me if I'm wrong), which tells me that the "free" states are sort of free in name only? 

My guess is:

If you are operating as a money transmitter in a state that doesn't require a license; then you would only need to register with FinCEN. But that would be if you are only doing business in that state. With the current guidance of FinCEN (until/if it is further clarified), the advantage I could see; is a miner would then be able to sell units that he/she mined on an exchange such as BTC-E. Again this is only a guess, as I'm not a lawyer.

The primary significance of those states is for local bitcoin sales or exchanges.  So, miners located in those states that sell their mined coin, for example, might be able to avoid state licensing requirements so long as they are selling those coins to people within the state.

Wouldn't they also be able to use an exchange located outside of the country?

In some cases a foreign exchange could solicit and service customers in those two states without licensing in those states.

So this means if Mt. Gox was in one of those states, they wouldn't of had money seized?

Would South Carolina and Montana then be good places to install Bitcoin ATMs?

From a legal perspective, yes.  From a business perspective, probably not.  Most of my clients are targeting NY, CA, TX, FL and IL, in roughly that order.  South Carolina and Montana are not very dense with bitcoiners.

Thanks for sharing your opinions, as always it helps shed a little light into the grey area we're all in now.

 

Happy to help!

Actually in addition to Montana and South Carolina, there's sort of a third state: in New Mexico there is no money transmission regulation unless involving a negotiable instrument.

Resurrecting this old thread to find out which States have residents who have successfully deposited/withdrawn fiat on Kraken.

By the way, included in my Magic Bag of Tricks is the ability to provide Montana corporations.

Not spamming; just saying......................................

I would not consider them "free" states as they still have federal regulations, just not additional, state level regulations.

Fed rules don't apply until the commerce crosses state lines.  If all activity is done within the state the Fed can't say anything.

I hear Montana is beautiful this time of year :)

Sure is and my Montana corporations are chugging right along......................

That is not true. The Federal government can regulate anything that affect interstate commerce.

Not only that but in order for a money transmitter to "transmit" the money they must connect to some network (usually the internet) and it is not unusual for an internet connection to span multiple states even if you are communicating with someone in the next town (same state)

MT is not so bad to start a biz - very easy to make great connections there.

I have registered with the Feds through my Montana corporation and am set up to deal offshore.

No USA customers though will be permitted.

Been gone for a while due to health issues but everything is OK now.

Just kind of took a break from the madness of crypto!

I have been looking into this for installing an ATM in my retail store in Idaho.

I have read the regulations in Idaho for a Money Transmitter License, and it does not look like an ATM qualifies for that requirement in this state.

There are a lot of examples given for those who would need a money transmitter license, but ATM doesn't show up as one.
It appears that a money transmitter license is meant for someone who is holding value for someone else.   But if it is a direct exchange, such as the person puts money into a machine and then receives their bitcoin immediately after, then there is no voucher, or store credit or held value.  It is a direct exchange, from my wallet it to theirs.

This is the topic that I started;  https://bitcointalk.org/index.php?topic=663651.msg7906206#msg7906206

It looks like I came up with some of the same links that had been used here.   

Any thoughts?   Does anyone know of any Bitcoin or Crypto ATMs in Idaho?

You're kidding, right?

Whats even more convincing that I do not need a money transmitter license, is that I have several friends in this community with retail businesses, who have ATM's in their stores, and they have no money transmitter license either.   Does the difference between fiat, which is officially a currency, and bitcoin which is neither officially a currency in Idaho, nor is it officially commodity, make the difference?

Fiat ATM =  No money transmitter license
Crypto ATM =  Need money transmitter license
?

Kidding about looking for these answers?  No I am rather serious.

You however, are you kidding with a reply like that?  No help, no advice, just sarcasm?   Thanks for nothing.

Oh, sorry.

I was just joking.

Ain't no Bitcoin ATMs in Montana and probably will not be.

Population there is too small.

I don't think my revenue will justify the headache and the cost.  But I like the idea of offering a deep discount for bitcoin customers for my products, and for those who can't figure out how to get bitcoin any other way, it seems like a good combo to 1.  Offer deep discounts for bitcoin  2.  Offer a method to attain bitcoin  3.  Educate the local community on bitcoin.

I am also contemplating getting a coinkite POS setup so that I can accept Litecoin as well.  (I personally prefer litecoin over bitcoin)