Bitcoin Forum

http://www.forbes.com/sites/realspin/2014/08/13/the-great-bitcoin-divide/

Midsummer is a time for young love, lightning storms and states sticking their nose into cryptocurrency regulation. Last July, as the price of bitcoin hovered around $70, California subpoenaed the Bitcoin Foundation, a nonprofit that exists to update the protocol and promote Bitcoin’s importance, to prove that it did not require a money transmitter license (despite the fact that it never transmitted money; it accepts dues, like any other professional trade organization). That controversy kept the price of bitcoin low all summer, but was forgotten as California never even responded to the Foundation’s well-crafted response.

Well written article. Take some time to read it ppl and pick your side.

Let's put it like this :

Cell phones {BTC} vs Analog Land lines {Fiat}

In the old days, most governments backed land based telephone lines, because it was state owned and properly regulated and easy to control. {Tap} Then came the cell phone companies, and these governments lost control, but still regulated the industry, but it was privately owned and more effective.

I see BTC as the cellphone and fiat currencies as the old analog telephones - Governments will still regulate it, but it must release some control to allow for innovation and job creation.

The way New York is going about it, will "crush" innovation, with over regulation and when innovation is stopped, job creation is stopped.

I do not see any need for a civil BTC war or the need for a divide, if all parties come together and "brainstorm" a solution, to accomodate both. {Less strict regulation, but just enough to protect consumers}

That is the only way. If they go towards strict regulations, BTC will go the same route as any other successfull peer-to-peer network. {Think music industry and copyright}

The Bitcoin Foundation was subpoenaed? What for? And where are they actually based. California?

You went wrong right at the start. It is Skype versus Telecom that is the correct analogy. Your analysis after that is predictably flawed.

Skype and VOIP needed Zero regulations to succeed.

Bitcoin is the same.

Don't ask permission, innovate (http://www.coindesk.com/bitcoin-regulation-lessons-early-days-skype/)

Hate to heap the scorn, but it is very much an imperfect analogy. The only thing the government regulations are protecting the customers from is paying reasonable rates and charges, it's a racket of vast proportions. The profit margins on mobile phone users range from 1,000-10,000%, although it's comforting to remember that we're getting that rate of return back on our bitcoin investments (so just spend more on buying dips than you do on phone top ups  :D)

They're so morally bankrupt, I feel like I may continue to pay them in fiat, even once they universally accept bitcoin

I gave it a read and decided and it is an interesting article equipping with different weapons towards the same issue.
Conflict can make something stronger so it will be worth seeing how this will turn out.
Good old pacifiers versus originals.
By the date though in 2012 I guess I'm not part of that guard but the early 2013 wave.

The "what for" is in the OP.  The details are in the article. 

Wikipedia says BTC foundation are headquartered in Seattle.

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