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Title: Pull coins out of Poloniex? Post by: bitcoinrocks on October 28, 2014, 06:15:55 PM How will Poloniex react to their SEC letter? Should we withdraw our coins?
Title: Re: Pull coins out of Poloniex? Post by: old fart on October 28, 2014, 06:38:34 PM I'm not sure if the information below is correct, it was posted by a guy starting a Philippines based exchange trying to get a US money transmitter license. He says it would cost a total of $7million to register with each individual state, and in the region of $250,000 a year in fees. If what he says is right then it might be a good idea to withdraw your coins from poloniex.
Been reading your posts for a while now, all very interesting and informative. Quick question for you: I have a startup operating outside of the USA (in Philippines), with all banking done here as well. The business units include a crypto exchange, digital wallets, and a rewards system. It deals with both crypto and fiat and definitely falls under the MSB licensing rules. We are registered with Fincen as MSB, but not with the individual states. I could just switch off the service to anyone in the USA, which seems a shame - we reached out to Meracord, who charge a minimum of $250,000 just to get started with them, but they said a flat no to us when we said our business involved Bitcoin. Do you know of a list of MTL operators with licenses in all states that would deal with startups like ours?. One thought that had occurred to me was to approach various MTL entities in each state and offer to pay them a fee to work through their license...but I am pretty sure their surety bonds suppliers may not be too happy with it. We don't have the finance or the time to go through every state to get a license, although in Philippines we are going the process of becoming an EMI, which requires $2.5m in paid up capital, and we will probably do the same in Europe which requires about $500k in paid in capital. No major licensing fees in either case. In the US, I have read it would cost in the region of about $7m to go through all the states, and in the region of $250,000 a year in fees. At this stage, definitely cheaper to go through another licensed entity. Just have to find the best option, and wondered if you know of companies providing this service. Title: Re: Pull coins out of Poloniex? Post by: bitcoinrocks on October 28, 2014, 07:43:44 PM Damn. I have like 10 different coins in there and the last thing I want to do is install a bunch of mysto software on my computer.
Title: Re: Pull coins out of Poloniex? Post by: devphp on October 28, 2014, 07:54:16 PM Damn. I have like 10 different coins in there and the last thing I want to do is install a bunch of mysto software on my computer. You're asking for trouble by storing coins at a centralized exchange, SEC or not. Title: Re: Pull coins out of Poloniex? Post by: arteleis on October 28, 2014, 08:00:51 PM Are X usd a processor or are they considered currency? The laws are vague and the only usa crypto exchange in compliance is cryptsy. The guys that started it and the guys that will end it.
Title: Re: Pull coins out of Poloniex? Post by: bitcoinrocks on October 28, 2014, 08:07:47 PM You're asking for trouble by storing coins at a centralized exchange, SEC or not. No argument here. the only usa crypto exchange in compliance is cryptsy. Is that right? That could be a nice spot to stash some coins. Are they going to add XMR? Title: Re: Pull coins out of Poloniex? Post by: mr_random on October 28, 2014, 08:26:45 PM The laws are vague and the only usa crypto exchange in compliance is cryptsy. Wrong. Cryptsy don't have money transmission licenses for 40 odd states of america. As far as I know there's actually no such thing as a compliant exchange which serves all of america. Kraken is very good with compliance but they don't serve most of the states. Title: Re: Pull coins out of Poloniex? Post by: 2dogs on October 28, 2014, 09:16:00 PM Wrong. Cryptsy don't have money transmission licenses for 40 odd states of america. Do you have a link/source for that? TIA Title: Re: Pull coins out of Poloniex? Post by: Este Nuno on October 28, 2014, 09:21:37 PM I think Poloniex is registered as a MSB in their state and they don't deal with fiat anyway.
Title: Re: Pull coins out of Poloniex? Post by: old fart on October 28, 2014, 10:18:46 PM I think Poloniex is registered as a MSB in their state and they don't deal with fiat anyway. I read an article that claimed FINCEN might now consider all exchanges, including those that do not deal with fiat as money transmitters. I quoted it's claim below. The administrative ruling was silent on exchanges that don’t involve the fiat component, so the status of altcoin exchanges is unclear at this point of time. Exchanges that don’t handle fiat have been popular in altcoin exchanges that trade altcoins for Bitcoins. Both of the components would come under the virtual currency definition of FinCEN as the exchange never touches fiat. It is likely, however, that FinCEN views pure virtual currency exchanges as MSBs too. http://www.coinsetter.com/bitcoin-news/2014/10/27/fincen-issues-administrative-ruling-bitcoin-exchanges-1724 Title: Re: Pull coins out of Poloniex? Post by: Zer0Sum on October 29, 2014, 03:17:47 AM I think Poloniex is registered as a MSB in their state and they don't deal with fiat anyway. I owned a US broker-dealer for 7 years... and have read 100s of these types of letters. If you read the 2 FinCEN letters issued recently... They make it absolutely crystal clear that a crypto only exchange qualifies as a "money transmitter".... And fails the tests to get an exemption from the registration and heavy reporting burden. As for Cryptsy, they identify themselves as FinCEN MSB Registration Number: 31000028408333 Which is the federal registration and likely needs variable followup in all 50 states... We are talking a 7 figure annual budget for legal, compliance and accounting. http://www.fincen.gov/financial_institutions/msb/msbstateselector.html https://i.imgur.com/ofEaDjk.png Title: Re: Pull coins out of Poloniex? Post by: Palmdetroit on October 29, 2014, 03:21:47 AM I think Poloniex is registered as a MSB in their state and they don't deal with fiat anyway. I owned a US broker-dealer for 7 years... and have read 100s of these types of letters. If you read the 2 FinCEN letters issued recently... They make it absolutely crystal clear that a crypto only exchange qualifies as a "money transmitter".... And fails the tests to get an exemption from the registration and heavy reporting burden. As for Cryptsy, they identify themselves as FinCEN MSB Registration Number: 31000028408333 Which is the federal registration and likely needs variable followup in all 50 states... We are talking a 7 figure annual budget for legal, compliance and accounting. http://www.fincen.gov/financial_institutions/msb/msbstateselector.html https://i.imgur.com/ofEaDjk.png Title: Re: Pull coins out of Poloniex? Post by: 2dogs on October 29, 2014, 05:48:44 AM Zer0sum,
Thanks for that great info. |
