I am pretty confident we are the new wealthy elite, gentlemen.

[hdbuck]

The difficulty is now too high for investments in mining to really be profitable unless you do it really big... which most people cannot afford to do..

Honestly I can make 100 or 200 per day selling BTC on localbitcoins.com, which I think is a lot more profitable and less risky than mining.

Do you buy from exchanges and sell locally?

Coinbase and sell locally/online.

I would actually make a lot more $ if I didn't have to wait 4 damn business days between purchases.

It is possible to wire $ to an exchange but you still have to wait 2-3 days for the wire to go through and it is possible the price could rise before then, causing a loss on the trade.

You're eventually going to get caught and prosecuted for money laundering and unlicensed money transmitting. I hope you're not in the US.

http://www.fincen.gov/statutes_regs/bsa/title18b.html

And your name is QuestionAuthority?

Bill Maher questions authority. Edward Snowden breaks the law and gives up his life to question authority. I believe in people banding together to make change happen not vigilante crusades by single individuals that act unilaterally on my behalf. If you want to be a prison martyr go right ahead. Charlie Shrem decided against that idea when he made his plea deal and it was the right decision.

Bill Maher is a comic who says marxist ideas to make tens of millions of dollars a year, be loved and connected; snowden scarified everything for its beliefs but he may have broke the law doing so

Snowden is a freakin hero, yet it seems no one really care.. blind sheeps in their consumerism prison, letting murica behave as they always do, bombing and comploting to rule (enslave) the world.

[JayJuanGee]

The difficulty is now too high for investments in mining to really be profitable unless you do it really big... which most people cannot afford to do..

Honestly I can make 100 or 200 per day selling BTC on localbitcoins.com, which I think is a lot more profitable and less risky than mining.

Do you buy from exchanges and sell locally?

Coinbase and sell locally/online.

I would actually make a lot more $ if I didn't have to wait 4 damn business days between purchases.

It is possible to wire $ to an exchange but you still have to wait 2-3 days for the wire to go through and it is possible the price could rise before then, causing a loss on the trade.

You're eventually going to get caught and prosecuted for money laundering and unlicensed money transmitting. I hope you're not in the US.

http://www.fincen.gov/statutes_regs/bsa/title18b.html

And your name is QuestionAuthority?

Bill Maher questions authority. Edward Snowden breaks the law and gives up his life to question authority. I believe in people banding together to make change happen not vigilante crusades by single individuals that act unilaterally on my behalf. If you want to be a prison martyr go right ahead. Charlie Shrem decided against that idea when he made his plea deal and it was the right decision.

Bill Maher is a comic who says marxist ideas to make tens of millions of dollars a year, be loved and connected; snowden scarified everything for its beliefs but he may have broke the law doing so

Snowden is a freakin hero, yet it seems no one really care.. blind sheeps in their consumerism prison, letting murica behave as they always do, bombing and comploting to rule (enslave) the world.

HDBuck:    I realize that you are trying to maintain the image that you are NOT influenced by my prophetic posts, but really, dude, you stole all my idears, in your post.      I don't mind though, because I am a kind of charitable and sharing guy..    I cannot help myself like that.  

[rpietila]

Snowden is a freakin hero, yet it seems no one really care.. blind sheeps in their consumerism prison, letting murica behave as they always do, bombing and comploting to rule (enslave) the world.

Snowden is right on par with MLK. Everybody knows that already. In which way should we "care" more?

[blatchcorn]

Snowden is a freakin hero, yet it seems no one really care.. blind sheeps in their consumerism prison, letting murica behave as they always do, bombing and comploting to rule (enslave) the world.

Snowden is right on par with MLK. Everybody knows that already. In which way should we "care" more?

Not everyone knows that, which is why people need to care more

[Oscilson]

Snowden is a freakin hero, yet it seems no one really care.. blind sheeps in their consumerism prison, letting murica behave as they always do, bombing and comploting to rule (enslave) the world.

Snowden is right on par with MLK. Everybody knows that already. In which way should we "care" more?

Not everyone knows that, which is why people need to care more

I know it now.

[KeyJockey]

You're eventually going to get caught and prosecuted for money laundering and unlicensed money transmitting. I hope you're not in the US.

http://www.fincen.gov/statutes_regs/bsa/title18b.html

Hi QuestionAuthority,

Thanks for posting, I've actually been researching this lately and would like to know more specifics IF you have details??

In particular, it's been my understanding (so far) that selling bitcoin in a direct person to person transfer (i.e. the proverbial meeting at Starbucks to exchange BTC for fiat) does NOT qualify as "money transmitting" under the law, for two primary reasons:

1. There is no "third party" involved who is "temporarily holding" the funds on behalf of the exchanging parties (i.e. as in Western Union)
2. Bitcoin is considered (by IRS for example) to be a commodity, or "value store" like maybe a gold coin or rare baseball card

Of these two, it's the first one that seems stronger to me. 

The asset in this case (bitcoin) is being simply handed over (albeit electronically) from one person to another, same way you might hand over the gold coin or baseball card DIRECTLY to the buyer, who is standing right in front of you there in the Starbucks.

Then, he hands you the fiat currency as payment.

There's no third party involved here, which appears is necessary (to me?) for the "money transmitter" element.

Of course, there IS the total bitcoin network but it's not quite the same thing: even ON the bitcoin network, this "asset" is immediately placed into the direct control of ONE party to the OTHER party (i.e. wallet to wallet, so again, no third party).

Again, if this is not correct in your understanding and selling bitcoin for cash person to person really DOES qualify under this law, I'd like to hear more specifically exactly WHY you say so (and please cite existing cases, prosecutions, etc... if they exist... and please NOT just that one arrest of that guy in Florida, i.e. the single instance LocalBitcoins.com case, that's already well known...

[lyth0s]

To the IRS Bitcoin is a commodity. To the rest of the government it is potentially a money and thus you would not be protected by stating that you are simply selling a commodity. If you are going to be exchanging a lot of bitcoins/USD you really need a money transmitting license and you WILL need to comply with KYC-AML laws otherwise they will nail you to the wall, if for nothing else but to make an example of you.

It's not worth jail time. Just don't do it, and if you're going to do it, make sure its on a very small scale and with trustworthy people. IE selling a few coins to a friend probably won't land you in a federal prison

[KeyJockey]

To the IRS Bitcoin is a commodity. To the rest of the government it is potentially a money and thus you would not be protected by stating that you are simply selling a commodity. If you are going to be exchanging a lot of bitcoins/USD you really need a money transmitting license and you WILL need to comply with KYC-AML laws otherwise they will nail you to the wall, if for nothing else but to make an example of you.

Thanks for comment lyth0s... again I'm just researching this info for specifics -- my understanding is $2999 maximum per person per day OR LOWER would be adequate compliance with these FINCEN laws (i.e. if a localbitcoins trader stays under this, they're prolly okay?  Would going OVER this constitute what you're loosely referring to here as "a lot"... and conversely staying below this would be "not a lot"...?)

But, again, does anyone have a SPECIFIC case or cases, already prosecuted and convicted, where someone HAS in fact been "nailed to the wall" precisely for this scenario, OR is this just an assumption on the part of most (prudent? cautious? or paranoid?) people here, who've considered this situation and are just ASSUMING this is what the "authorities" will do...?

[marcus_of_augustus]

To the IRS Bitcoin is a commodity. To the rest of the government it is potentially a money and thus you would not be protected by stating that you are simply selling a commodity. If you are going to be exchanging a lot of bitcoins/USD you really need a money transmitting license and you WILL need to comply with KYC-AML laws otherwise they will nail you to the wall, if for nothing else but to make an example of you.

It's not worth jail time. Just don't do it, and if you're going to do it, make sure its on a very small scale and with trustworthy people. IE selling a few coins to a friend probably won't land you in a federal prison

sad days when people are too scared of their govt. to trade a few bits of harmless electronic data between them without threat of jail time ... is it really this bad?

[QuestionAuthority]

You're eventually going to get caught and prosecuted for money laundering and unlicensed money transmitting. I hope you're not in the US.

http://www.fincen.gov/statutes_regs/bsa/title18b.html

Hi QuestionAuthority,

Thanks for posting, I've actually been researching this lately and would like to know more specifics IF you have details??

In particular, it's been my understanding (so far) that selling bitcoin in a direct person to person transfer (i.e. the proverbial meeting at Starbucks to exchange BTC for fiat) does NOT qualify as "money transmitting" under the law, for two primary reasons:

1. There is no "third party" involved who is "temporarily holding" the funds on behalf of the exchanging parties (i.e. as in Western Union)
2. Bitcoin is considered (by IRS for example) to be a commodity, or "value store" like maybe a gold coin or rare baseball card

Of these two, it's the first one that seems stronger to me. 

The asset in this case (bitcoin) is being simply handed over (albeit electronically) from one person to another, same way you might hand over the gold coin or baseball card DIRECTLY to the buyer, who is standing right in front of you there in the Starbucks.

Then, he hands you the fiat currency as payment.

There's no third party involved here, which appears is necessary (to me?) for the "money transmitter" element.

Of course, there IS the total bitcoin network but it's not quite the same thing: even ON the bitcoin network, this "asset" is immediately placed into the direct control of ONE party to the OTHER party (i.e. wallet to wallet, so again, no third party).

Again, if this is not correct in your understanding and selling bitcoin for cash person to person really DOES qualify under this law, I'd like to hear more specifically exactly WHY you say so (and please cite existing cases, prosecutions, etc... if they exist... and please NOT just that one arrest of that guy in Florida, i.e. the single instance LocalBitcoins.com case, that's already well known...

You should PM HELP.org and ask him. I think he requested and received the definition on that and mining registration from FINCen. 

[stevegee58]

sad days when people are too scared of their govt. to trade a few bits of harmless electronic data between them without threat of jail time ... is it really this bad?

That's the same excuse people tried using for kiddie porn in court.  "It's just a bunch of 1's and 0's why is that a crime?"

[cbeast]

sad days when people are too scared of their govt. to trade a few bits of harmless electronic data between them without threat of jail time ... is it really this bad?

That's the same excuse people tried using for kiddie porn in court.  "It's just a bunch of 1's and 0's why is that a crime?"

You just sent 1s and 0s. Are you admitting your crime?

[Erdogan]

DontQuestionAuthorityJustBendOverArsUp, you are a slave.

[KeyJockey]

sad days when people are too scared of their govt. to trade a few bits of harmless electronic data between them without threat of jail time ... is it really this bad?

Yes, Marcus... that's kinda my point.

The original poster IS correct that trading a little btc person to person for cash from time to time actually does seem to be a decent way to make a little profit from holding bitcoin and being involved in the "BTC Scene" these days... especially as the price has been dipping last few months and we're all WAITING for the next big run-up to finally get started.

More people doing this also could enable MORE people to EASILY get a little bitcoin, getting MORE folks started using it and learning about it all and how it all works.  If that happened, it would help the overall bitcoin economy grow, and THAT in turn would improve the odds of the price increase we all want to see, actually happening.

But it seems like the "OMG If I Sell BTC For Cash Then Big Bad Scary John Law Is Gonna Break Down My Door And Throw My Ass In Federal Prison" kind of irrational fear is preventing more people from considering actually doing this.

What I wanna know is very simple: IS this fear really grounded in reality? or is it just as you say, people are "too scared of their govt"? 

[QuestionAuthority]

sad days when people are too scared of their govt. to trade a few bits of harmless electronic data between them without threat of jail time ... is it really this bad?

Yes, Marcus... that's kinda my point.

The original poster IS correct that trading a little btc person to person for cash from time to time actually does seem to be a decent way to make a little profit from holding bitcoin and being involved in the "BTC Scene" these days... especially as the price has been dipping last few months and we're all WAITING for the next big run-up to finally get started.

More people doing this also could enable MORE people to EASILY get a little bitcoin, getting MORE folks started using it and learning about it all and how it all works.  If that happened, it would help the overall bitcoin economy grow, and THAT in turn would improve the odds of the price increase we all want to see, actually happening.

But it seems like the "OMG If I Sell BTC For Cash Then Big Bad Scary John Law Is Gonna Break Down My Door And Throw My Ass In Federal Prison" kind of irrational fear is preventing more people from considering actually doing this.

What I wanna know is very simple: IS this fear really grounded in reality? or is it just as you say, people are "too scared of their govt"? 

It's not really an irrational fear but it's doubtful it will happen on really small amounts. It's just like all the thousands of people that used Silk Road to buy marijuana. Is it technically illegal - yes. Is the government going to go after you for buying a small quantity for personal use - probably not.

In order to exchange dollars for Bitcoin you need to have a license and follow AML/KYC laws. One of the great Bitcoin pioneers, Charlie Shrem, is going to jail because he did it but he was a big fish. You are a baby minnow. They won't do anything unless you rub their nose in it or they want you for something else and that's just a charge they tack on (don't smoke a joint in a police station go to the park around the corner).

[zimmah]

the government should be afraid of the people, especially in a democracy,

but the government became too powerful, and people just let it happen.

[phillipsjk]

You're eventually going to get caught and prosecuted for money laundering and unlicensed money transmitting. I hope you're not in the US.

http://www.fincen.gov/statutes_regs/bsa/title18b.html

That was not entirely helpful, but is at least a starting point. Simply exchanging foreign currency does not automatically make you a money transmitter. To find out if you qualify as a money transmitter, you have to look up the regulations. I found an unofficial copy:
Electronic Code of Federal Regulations; Title 31: Money and Finance: Treasury; PART 1010—GENERAL PROVISIONS; Subpart A—General Definitions
The relevant subsection is subsection (ff)
Selected quotes:

(ff) Money services business. A person wherever located doing business, whether or not on a regular basis or as an organized or licensed business concern, wholly or in substantial part within the United States, in one or more of the capacities listed in paragraphs (ff)(1) through (ff)(7) of this section. This includes but is not limited to maintenance of any agent, agency, branch, or office within the United States.

(1) Dealer in foreign exchange. A person that accepts the currency, or other monetary instruments, funds, or other instruments denominated in the currency, of one or more countries in exchange for the currency, or other monetary instruments, funds, or other instruments denominated in the currency, of one or more other countries in an amount greater than $1,000 for any other person on any day in one or more transactions, whether or not for same-day delivery.
.
.
.
(8] Limitation. For the purposes of this section, the term “money services business” shall not include:
...
(iii) A natural person who engages in an activity identified in paragraphs (ff)(1) through (ff)(5) of this section on an infrequent basis and not for gain or profit.

My reading of that is that you can set up a bitcoin ATM in your place of business with a $1000/day (global) limit with no problems and no KYC requirements.

If you want to sell more than $1000/day, you are allowed to do that too, all long as you don't make a business out of it (maybe one transaction every quarter).

Edit: I suppose I should look up the Canadian regulations too: I think that is where I pulled the quarterly limitation from.

Update: What I found linked from the the FINTRAC website does not appear promising. The regulations can't be understood without reading the Enabling Act.

While transactions less than $1000 do not need to be routinely reported, Canada has no minimum threshold where suspicious activity (were you suspect terrorist financing or money laundering) does not have to be reported. It appears the regulations are structured such that small businesses are expected to act as a franchisee under a larger MSB: where the larger business handles most of the reporting intecraceis.

There is also the issue where non-SWIFT transfers are supposed to have comprehensive information about the sender an recipient accompanying them (Bitcoin really does not support that in a secure/cheap way). Bitcoin is also border-less: the reporting requirements change for a "Foreign Politically Exposed Person" (probably why CaVirtex is Canada-only).

[QuestionAuthority]

You're eventually going to get caught and prosecuted for money laundering and unlicensed money transmitting. I hope you're not in the US.

http://www.fincen.gov/statutes_regs/bsa/title18b.html

That was not entirely helpful, but is at least a starting point. Simply exchanging foreign currency does not automatically make you a money transmitter. To find out if you qualify as a money transmitter, you have to look up the regulations. I found an unofficial copy:
Electronic Code of Federal Regulations; Title 31: Money and Finance: Treasury; PART 1010—GENERAL PROVISIONS; Subpart A—General Definitions
The relevant subsection is subsection (ff)
Selected quotes:

(ff) Money services business. A person wherever located doing business, whether or not on a regular basis or as an organized or licensed business concern, wholly or in substantial part within the United States, in one or more of the capacities listed in paragraphs (ff)(1) through (ff)(7) of this section. This includes but is not limited to maintenance of any agent, agency, branch, or office within the United States.

(1) Dealer in foreign exchange. A person that accepts the currency, or other monetary instruments, funds, or other instruments denominated in the currency, of one or more countries in exchange for the currency, or other monetary instruments, funds, or other instruments denominated in the currency, of one or more other countries in an amount greater than $1,000 for any other person on any day in one or more transactions, whether or not for same-day delivery.
.
.
.
(8] Limitation. For the purposes of this section, the term “money services business” shall not include:
...
(iii) A natural person who engages in an activity identified in paragraphs (ff)(1) through (ff)(5) of this section on an infrequent basis and not for gain or profit.

My reading of that is that you can set up a bitcoin ATM in your place of business with a $1000/day (global) limit with no problems and no KYC requirements.

If you want to sell more than $1000/day, you are allowed to do that too, all long as you don't make a business out of it (maybe one transaction every quarter).

Edit: I suppose I should look up the Canadian regulations too: I think that is where I pulled the quarterly limitation from.

Yeah, but they are talking about doing it frequently and for a profit. You know - buy low - sell high. Anything else is just masterbating.

[btclegonaire]

hopefully one day i will myself be a self made millionaire due to bitcoin, lets hope for the best because ive diserved it , its been a long time coming

[Dafar]

hopefully one day i will myself be a self made millionaire due to bitcoin, lets hope for the best because ive diserved it , its been a long time coming

you can't even spell deserve, so no you don't