[BTC-TC] Virtual Community Exchange [CLOSED]

[Deprived]

Can we still make deposits? Before last trading day?

Yes, deposits work fine.

I've done significant(ish) deposits to both BTC-TC and LTC-Global today to get funds in so I could close my securities out.

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[Rannasha]

Can we still make deposits? Before last trading day?

The exchange should be fully operational (with the exception of new registrations & asset creation) until 7 October.

[metal_jacke1]

Every share holder contacting the issuer is not going to help the process or speed things up, it is probably best to give them a few days(the ones you trust anyway) to sort alternatives and figure things out for themselves as i doubt BS gave them anymore notice than the shareholders.

Contacting any other parties in advance was not an option.  There should be plenty of time to figure things out.

I don't understand. What prevents you from telling us now? Did the sec put a gag order on you?

Let me explain what the most likely scenario is - and what the answers are then to your question and some other common ones.

Burnside retained legal counsel to advise on what to do to ensure BTC-TC was legally fine (that's already known).
His lawyers advised that there was no way he should continue doing what he's doing and that he needed to stop doing it.  And that he needed to stop doing it without creating further liability for himself.

• At that point he CAN'T explain what his lawyers advised him - as to do so involves admitting that he was breaking the law.
• And he can't sell the exchange as a going concern to anyone else - because if his lawyers told him BTC-TC was illegal then they'd also have told him that he couldn't sell it (as a going concern) to anyone else.  It's a bit like if you'd been dealing drugs : your lawyer would very strongly advise you NOT to sell your stock to some other dealer.
• And once your lawyers have told you that you must not do something then you lose the ability to claim that you believe it to be OK.  As if your lawyers strongly advise you on a course of action and you choose not to follow it they are typically going to ask you sign a statement that they advised you NOT to do what you're doing - so their ass is covered.
• He MAY be able to sell the code-base - as that isn't illegal.  But obviously he's not going to even consider doing that until the exchanges are fully shut down.

It seems highly unlikely to me that he's been told to close down by the SEC or any LE.  Were that to have happened then closure would have been more of a case of pulling the plug out than the gradual winding down that has been announced.  This feels far more like being told to stop by his own lawyers than a cease-and-desist or seizure by some government agency - they don't give you a month to sort things out in, they want immediate cessation of activity.

Although I ran multiple securities on LTD-Global/BTC-TC I was provided with no more information than the rest of you (and that IS how it should be).  As recently as yesterday I was in contact with him about sorting out a problem with the locking state of a new security I was working on.  I had, of course, already realised there was a pretty decent likelihood of BTC-TC closing or removing access from US investors/issuers - that became evident as a possibility as soon as signups/creation of securities was disabled without any explanation (plus the rushed addition of withdrawal addresses for issuers).

Firstly, I doubt his lawyers would say it was "illegal". No precedent. No law on the books regarding bitcoin and securities.

Further, you would WANT any litigation because if any federal judge said, this is just a virtual game as BTCT stated in their policy blah blah blah then that would be a win for bitcoin. Something the government does NOT want at all.

Chances are either he's just tired of doing it (doubt it) or he got a letter from SEC. Rather than caving he should challenge.

[baloo_kiev]

All this situation is extremely disappointing. If we consider it 'grey area' and 'gamble', we must agree that every BTC exchange is also grey area and gamble. Just look at recent problems: MtGox, CoinLenders, now BTC-TC. What next? Other exchanges? And then pools? None of them has AMC/KYC as far as I know.

Another disappointing tendency is that the concept of trust seems to be not working. If someone was fair before, it doesn't mean he will not eventually scam you (BFL, Avalon). If a service operated succesfully for a long time, it still doesn't mean it won't shut down one day (like BTC-TC today).

I am starting to loose faith in BTC. Those government bastards will destroy it or just push it from the 'grey' area to completely illegal field. Maybe it will even cause a boost in BTC price but I will not be satisfied. They can just turn my coins into something like a kilogram of cocaine: yes, it costs a shitload of money but normally I don't want to possess it, and if I try to sell it, I will most probably end up in jail

[Puppet]

Firstly, I doubt his lawyers would say it was "illegal". No precedent. No law on the books regarding bitcoin and securities.

The law doesnt need to mention bitcoin. The law doesnt mention dollar or money either, it mentions "value". For something to be considered a security, it has to be a contract thats tradeable for value. That bitcoin has value is both obvious and established by a court (cf Pirate's SEC trial).

Further, you would WANT any litigation because if any federal judge said, this is just a virtual game as BTCT stated in their policy blah blah blah then that would be a win for bitcoin. Something the government does NOT want at all.

Thats what Pirate tried and failed. As posted earlier:

Shavers argues that the BTCST investments are not securities because Bitcoin is not money, and is not part of anything regulated by the United States
So Shavers essentially tried to say that Bitcoin is a bauble and that he was taking in digital points and giving out digital points that had no real world value. The prosecutors at the SEC disagree, arguing that Bitcoins “are both investment contracts and notes, and, thus, are securities.”
..
the judge sided with the SEC, giving Bitcoin his stamp of approval as real world money.

http://www.forbes.com/sites/kashmirhill/2013/08/07/federal-judge-rules-bitcoin-is-real-money/

[crumbs]

...
Firstly, I doubt his lawyers would say it was "illegal". No precedent. No law on the books regarding bitcoin and securities.

Further, you would WANT any litigation because if any federal judge said, this is just a virtual game as BTCT stated in their policy blah blah blah then that would be a win for bitcoin. Something the government does NOT want at all.

Chances are either he's just tired of doing it (doubt it) or he got a letter from SEC. Rather than caving he should challenge.

Lol, you seem to haz the  legal learningz, conviction & cojones. Start an exchange & put some skin in the game.

[baloo_kiev]

Firstly, I doubt his lawyers would say it was "illegal". No precedent. No law on the books regarding bitcoin and securities.

The lawyers could just warn him.
Even if no law says it's illegal, the officials can always start investigation, which will begin from confiscation of the servers and data. The investigation may last for months and years. Effectively, this means lost of all coins and assets.

[samson]

It's time for decentralised exchanges or coloured coins.

I haven't read up on the coloured coins concept for a long time.

I have wondered why a new blockchain (same as an alt) couldn't be created and issued as a stock where the coins represent shares.

Of course minting would be restricted to a single central authority instead of miners - the company who issues the shares. There would be no miners and the central authority (floated company) would issue new blocks into the network as required to meet transfers between holders on it's own blockchain.

A separate blockchain could be used for each company offering shares as an IPO.

Shares could be transferred around and traded between owners just like any other coin.

If someone built a generic centrally controlled coin that could be used in this manner then there should really be no stopping it and anyone could create their own. Maybe there's some overlap in this approach with the coloured coins approach.

EDIT : I may be prepared to fund or help fund such a project as this or the coloured coins idea providing every aspect of it is fully open sourced and anyone can easily create their own variants for trading.

[EskimoBob]

It's time for decentralised exchanges or coloured coins.

I haven't read up on the coloured coins concept for a long time.

I have wondered why a new blockchain (same as an alt) couldn't be created and issued as a stock where the coins represent shares.

Of course minting would be restricted to a single central authority instead of miners - the company who issues the shares. There would be no miners and the central authority (floated company) would issue new blocks into the network as required to meet transfers between holders on it's own blockchain.

A separate blockchain could be used for each company offering shares as an IPO.

Shares could be transferred around and traded between owners just like any other coin.

If someone built a generic centrally controlled coin that could be used in this manner then there should really be no stopping it and anyone could create their own. Maybe there's some overlap in this approach with the coloured coins approach.

Open Transactions looked like a interesting option. After I wasted some time with it, I gave up.

[metal_jacke1]

Firstly, I doubt his lawyers would say it was "illegal". No precedent. No law on the books regarding bitcoin and securities.

The law doesnt need to mention bitcoin. The law doesnt mention dollar or money either, it mentions "value". For something to be considered a security, it has to be a contract thats tradeable for value. That bitcoin has value is both obvious and established by a court (cf Pirate's SEC trial).

Further, you would WANT any litigation because if any federal judge said, this is just a virtual game as BTCT stated in their policy blah blah blah then that would be a win for bitcoin. Something the government does NOT want at all.

Thats what Pirate tried and failed. As posted earlier:

Shavers argues that the BTCST investments are not securities because Bitcoin is not money, and is not part of anything regulated by the United States
So Shavers essentially tried to say that Bitcoin is a bauble and that he was taking in digital points and giving out digital points that had no real world value. The prosecutors at the SEC disagree, arguing that Bitcoins “are both investment contracts and notes, and, thus, are securities.”
..
the judge sided with the SEC, giving Bitcoin his stamp of approval as real world money.

http://www.forbes.com/sites/kashmirhill/2013/08/07/federal-judge-rules-bitcoin-is-real-money/

Value can be interpreted in any way shape and form. Craigslist lists items that are worth in value, all private sales. Im not sure how you can say that something is illegal when it's not even law. Im not sure what "law" you're referring to. I assume the Securities Act of 1933, which does mention "FOREIGN" Currency. And since Bitcoin is neither foreign NOR domestic, that can be challenged. http://www.sec.gov/about/laws/sa33.pdf

The judge in the Pirate case issued this opinion regarding Subject Matter Jurisdiction claims that they do have jurisdiction over legal proceedings regarding bitcoin. Note, its not a conviction, its not a summary judgement. Of course the Courts like to think they have Subject Matter Jurisdiction over the lint balls in our crotch which is why there is an Appellate court that can overturn this decision.

And of course the SEC disagrees! Its a power grab. The point is to CHALLENGE the Constitutional authority of the SEC to say they have control over something the US govt did not issue, no govt ever issued, and its completely private. Which can further stipulate what the Federal Government can or cannot say over matters of private property rights.

If you really want freedom from the SEC. Donate to a Bitcoin legal fund.

[metal_jacke1]

Also, remember folks who you vote for. The President appoints Federal Judges like this that strike down Bitcoin for the sake of Government Control. Best chance for Bitcoin, Tea Party/Libertarian.

[Puppet]

Value can be interpreted in any way shape and form. Craigslist lists items that are worth in value, all private sales.

Indeed. tradable contracts issued again anything of value is a security. That can be gold, oil, bread or bitcoins.

Im not sure how you can say that something is illegal when it's not even law.

The law doesnt mention rembrandt paintings either, you think that makes it legal to steal, vandalize or counterfeit ?

Im not sure what "law" you're referring to. I assume the Securities Act of 1933, which does mention "FOREIGN" Currency.

Read the context. The foreign currency swap is one of many examples of objects of the contract. But try reading the rest of the phrase too, like this part:
,he term ‘‘security’’ means any note, stock, treasury
stock, security future, security-based swap, bond, debenture,
evidence of indebtedness, certificate of interest or participation .

Note the absence of the words coal, corn, dollars, oil.
And bitcoin.

Doesnt mean it doesnt apply.

[EskimoBob]

What if btct and ltcglobal are moved to tor? Yes it can be slow but still better than nothing.

[metal_jacke1]

Value can be interpreted in any way shape and form. Craigslist lists items that are worth in value, all private sales.

Indeed. tradable contracts issued again anything of value is a security. That can be gold, oil, bread or bitcoins.

Im not sure how you can say that something is illegal when it's not even law.

The law doesnt mention rembrandt paintings either, you think that makes it legal to steal, vandalize or counterfeit ?

Im not sure what "law" you're referring to. I assume the Securities Act of 1933, which does mention "FOREIGN" Currency.

Read the context. The foreign currency swap is one of many examples of objects of the contract. But try reading the rest of the phrase too, like this part:
,he term ‘‘security’’ means any note, stock, treasury
stock, security future, security-based swap, bond, debenture,
evidence of indebtedness, certificate of interest or participation .

Note the absence of the words coal, corn, dollars, oil.
And bitcoin.

Doesnt mean it doesnt apply.

Im talking about the definition of bitcoin and the governments jurisdiction over it. BTCT had no contracts, everything was "SIMULATED" as according to their terms and conditions. You cant compare "theft" with trading in btc.

Yes, Im familiar with the Securities Act of 1933 but you realize that judges cant legislate from the bench right?

Further, from your logic, the SEC can regulate my Pokemon card trading game if I sell contracts and speculate the value of rare Pokemon cards? No, there is a line between private property and government control. You ceding your rights to the government will make Bitcoin fail.

[Pale Phoenix]

Value can be interpreted in any way shape and form. Craigslist lists items that are worth in value, all private sales.

Indeed. tradable contracts issued again anything of value is a security. That can be gold, oil, bread or bitcoins.

Im not sure how you can say that something is illegal when it's not even law.

The law doesnt mention rembrandt paintings either, you think that makes it legal to steal, vandalize or counterfeit ?

Im not sure what "law" you're referring to. I assume the Securities Act of 1933, which does mention "FOREIGN" Currency.

Read the context. The foreign currency swap is one of many examples of objects of the contract. But try reading the rest of the phrase too, like this part:
,he term ‘‘security’’ means any note, stock, treasury
stock, security future, security-based swap, bond, debenture,
evidence of indebtedness, certificate of interest or participation .

Note the absence of the words coal, corn, dollars, oil.
And bitcoin.

Doesnt mean it doesnt apply.

Im talking about the definition of bitcoin and the governments jurisdiction over it. BTCT had no contracts, everything was "SIMULATED" as according to their terms and conditions. You cant compare "theft" with trading in btc.

Yes, Im familiar with the Securities Act of 1933 but you realize that judges cant legislate from the bench right?

Further, from your logic, the SEC can regulate my Pokemon card trading game if I sell contracts and speculate the value of rare Pokemon cards? No, there is a line between private property and government control. You ceding your rights to the government will make Bitcoin fail.

The Securities Act is a statute passed by Congress with 80 years of judicial interpretation already baked in, not to mention the regulations promulgated by the agencies charged with its enforcement. No legislating from the bench is required at this point.

You can sell all the Pokemon cards you want. When you make a general offering of shares in your Pokemon collection to the public, you are plainly in SEC or CFTC territory. No amount of "virtual" or "simulated" disclaimers change the substance of the transaction.

[creativex]

The us federal government will do whatever they want to do. Look at PPACA, which has been ruled Constitutional on the grounds that DC has the authority to regulate INTERstate commerce. The entire pretense is ludicrous, because PPACA MANDATES INTRAstate commerce and punishes inactivity, which is plainly not the same as regulating interstate commerce. The judiciary is as corrupt as the executive and legislative branches. Anything outside government's control will be attacked.

[HeRetiK]

Dear US Bitcoiners,

Kindly to tell your government to stop acting like the world police and ruining all the fun.

Sincerely,
A non-US citizen

---

Seriously though, I hope Bitfunder and Havelock will be able to hold on a little longer until decentralized trading can take care of business.

Sad to see btct.co go. The share prices are kinda painful to watch right now, but I'm rather blaming the panic sellers and FUDsters than Burnside so far. Yeah, you know who you are.

I think the most will be up to the asset-issuers on how they will handle the situation.

I wouldn't worry about AM-PT and the other assets that are traded on either Bitfunder or Havelock. Everything else, let's see. Here's hoping...

[Ukyo]

Hey guys (and gals),

It is obvious that everyone is highly interested in the reasons behind this latest change.
Burnside has already stated he would shed light on things as soon as he can.

It would probably be best to leave speculation aside until that point. There are easily any number of possibilities here.
Unlike a prior fiasco which to this day refuses to say who/what/why and disappeared without warning , Burnside seems to be doing the best with whatever limitation we do not know.
Give him time to handle what he needs to and make any statements he has before we let too many mass rumors fly.

Burnside, As a BTCT user, I would like to thank you for operating the site for as long as you did and keeping it as reliable as it has been.

[BTCThousandaire]

Could we get a temporary feature to add a bitfunder account to btct to facilitate the transfer of shares, since this will be the most common place to transfer to?

[velacreations]

Hey guys (and gals),

It is obvious that everyone is highly interested in the reasons behind this latest change.
Burnside has already stated he would shed light on things as soon as he can.

It would probably be best to leave speculation aside until that point. There are easily any number of possibilities here.
Unlike a prior fiasco which to this day refuses to say who/what/why and disappeared without warning , Burnside seems to be doing the best with whatever limitation we do not know.
Give him time to handle what he needs to and make any statements he has before we let too many mass rumors fly.

Burnside, As a BTCT user, I would like to thank you for operating the site for as long as you did and keeping it as reliable as it has been.

Ukyo, what steps have you taken/are taking to prevent a similar fate to your exchange?