Idea: Dwolla - Ripple gateway

[Peter Lambert]

So I was wondering if anybody would be interested in using a gateway for moving between Dwolla and Ripple? I thought of this after selling some of the free XRP I got in the giveaway, the money trail went something like this:

Ripple XRP --> Ripple BTC/bitstamp --> Bitstamp BTC --> CampBX BTC --> CampBX USD --> Dwolla USD --> my bank

We could cut out a few steps by setting up a gateway with a Dwolla account, then the transfer would go:

Ripple XRP --> Ripple USD/MyGateway --> Dwolla USD --> my bank

This seems like it would be a nice way to connect Dwolla to the Ripple network.

I am not sure if the person running this would have to be licensed as a US money-servicing business(MSB)? They would also want to clear it with Dwolla as well.

Any thoughts or ideas?

[epetroel]

Would this (theoretically) allow people to deposit and withdraw USD to/from BitStamp via Dwolla?  Or does BitStamp's ripple gateway only support BTC?

[Sukrim]

You could exchange the PLambertUSD via XRP or maybe directly BitstampUSD, yes.

I would clarify this with Dwolla though.

[Peter Lambert]

Would this (theoretically) allow people to deposit and withdraw USD to/from BitStamp via Dwolla?  Or does BitStamp's ripple gateway only support BTC?

Yes, that is the idea here. If I set up the gateway, then you would send Dwolla USD to my Dwolla account, I would then send USD/PeterLambert to your ripple account. You could then exchange the USD/PeterLambert for USD/BitStamp (I would set up liquidity within Ripple to allow people to do that 1:1), You could also directly trade the USD/PeterLambert for BTC/BitStamp.  You can currently withdraw either USD or BTC from Ripple to BitStamp.

Going the other way, anybody who trades to get USD/PeterLambert could send them to me and I would send a Dwolla transaction to their account (or to the account of whoever they want to pay using Dwolla).

This would also allow people to easily invest dollars into companies on BitFunder. The whole transaction [Dwolla -> GateWay -> Ripple -> WeExchange -> Bitfunder -> Company] can happen in a couple minutes.

I would clarify this with Dwolla though.

Yes, before anybody sets this up they would want to clear it with Dwolla.

[🏰 TradeFortress 🏰]

Go ahead, get your Dwolla account frozen or seized.

There is zero chance that Dwolla will accept this, and even if somehow they approve it (without consulting their legal team) you will probably be charged with facilitating money laundering in 6 - 18 months of time. Have fun.

If you are not in the US and don't use a US service, then add a few years.

[Peter Lambert]

Go ahead, get your Dwolla account frozen or seized.

There is zero chance that Dwolla will accept this, and even if somehow they approve it (without consulting their legal team) you will probably be charged with facilitating money laundering in 6 - 18 months of time. Have fun.

If you are not in the US and don't use a US service, then add a few years.

Did you read the OP?

I am not sure if the person running this would have to be licensed as a US money-servicing business(MSB)? They would also want to clear it with Dwolla as well.

Even if somebody could set this up while not licensed as a MSB, I am sure there are plenty of other hoops they must jump through with the US gov.

[🏰 TradeFortress 🏰]

Yes, again, there is zero chance that Dwolla is going to accept this. Send them a ticket or whatever, see what you get.

[Sukrim]

https://www.dwolla.com/tos#conduct

I guess your idea would qualify as "money service", as you do not decide where you actually send the transaction to, but let others decide on that and act on their behalf.

It would be a neat service idea and probably needed and so on, BUT (and that's a big but!) it is impossible to do this on a larger scale (meaning above a few hundred USD per year) without drawing attention from Dwolla. You need their approval to act against their TOS, so probably you should start founding a company instead of asking as a "regular user" in the first place, to be taken a bit more serious.

[Peter Lambert]

https://www.dwolla.com/tos#conduct

I guess your idea would qualify as "money service", as you do not decide where you actually send the transaction to, but let others decide on that and act on their behalf.

It would be a neat service idea and probably needed and so on, BUT (and that's a big but!) it is impossible to do this on a larger scale (meaning above a few hundred USD per year) without drawing attention from Dwolla. You need their approval to act against their TOS, so probably you should start founding a company instead of asking as a "regular user" in the first place, to be taken a bit more serious.

I think we already mentioned you would need "written consent to operate or engage in any business regulated by FinCen, including the money service business" as in their ToS. Once you had that written consent you would not have to worry about Dwolla coming after you.

Framing this as a business would be the best way to do it. That would allow raising of capital, making things more liquid. Having a business set up would also allay some of the trust issue; people understand they have to send first to a business, but many people are reluctant to send first when dealing with some random guy on the internet.