US and Canadian users no longer allowed to use MtGox directly?

[evolve]

http://coinlab.com/new-transition

What, exactly is happening?
Right now Mt. Gox keeps US and Canadian customer funds in Japan and Europe, mostly. CoinLab is going to take over servicing those accounts, and move them to Silicon Valley Bank in the US.

When that happens, if your'e a Mt. Gox customer, you will be transitioned to CoinLab as your primary exchange relationship. We'll provide the liquidity for your US or Canadian-based business.

What if I don't want to be a CoinLab customer? Can I stay with Mt. Gox if I'm in the US or Canada?
We'll miss you, but you can always leave us. If you are in the US/Canada, you can't stick with Mt. Gox, though. Part of our agreement with Mt. Gox is super-strict about locale: Mt. Gox really wants to be 100% out of the US/Canada market.

What if I'm in Europe and want to be a CoinLab customer?
Awww, how sweet! While we can offer storage, consulting and super-compute services to you, we can't offer exchange or liquidity services -- but you can always sign up with Mt. Gox and get access to the same liquidity pool.

How secure is your setup?
It's pretty secure; it beats, by a significant margin, all other known US bitcoin security practices. Mt. Gox has also reviewed the procedures and indicated they are comfortable with them. Before we launch, we'll detail what we're doing on the security side so you can check in, but you can read a bit about at storage right now.

This is bullshit.

[chriswilmer]

When does this take effect?

[evolve]

March 31.

[Fuzzy]

Mt. Gox really wants to be 100% out of the US/Canada market.

How can you WANT to be OUT of the BIGGEST market, as a business?

[Merralea]

I can't decide if this is extremely good or extremely bad.
Either way, I'm going to continue staying the hell away.

[Morblias]

CoinLab is going to take over servicing those accounts, and move them to Silicon Valley Bank in the US.

Future news article: 'US Government seizes $100 million from CoinLab's bank account.'

[matthewh3]

http://bitcoinmagazine.com/coinlab-bringing-bitcoin-to-wall-street-with-mtgox-deal/

Coinlab Bringing Bitcoin to Wall Street with MtGox Deal



A venture capitalist backed Bitcoin company wants to make it safe for U.S. and Canadian investors to do large block trades of Bitcoins and keep them ultra-secure from loss. Coinlab has worked for a year to sign an exclusive long term deal with Bitcoin exchange Mt.Gox. The Silicon Valley-based company will take over exchange transactions for all U.S. and Canada clients meaning your money will get moved to a U.S. bank and Coinlab will now be the clearing pool for all peer-to-peer transaction on the Mt.Gox exchange. The safeguards they have set up is a move to drive more U.S. volume in Bitcoins along with paving a way for institutional investors and high net-worth individuals to buy and hold large amounts of the digital currency.

“80 percent of Mt.Gox traffic already comes from this area. We are essentially buying their book of traffic,” Peter Vessenes told Bitcoin Magazine in an interview.  The goal is to move customers’ money from overseas to Silicon Valley Bank by March 22nd. This should cut down on the fees, currently around $60, that clients pay Mt.Gox for international wire transfers to their U.S. bank.

Coinlab was the first Bitcoin company to get venture capital money, over $500,000, last year. They were known as providing games paid for with Bitcoins but this move into mass retail transaction service takes the firm into a whole new sphere.

Right now an average Mt.Gox customer pays .6% per transaction, volume over 10,000 pays only .3%. These tier two customers will now get live phone help via Coinlab experts. Vessenes says large transactions will still have to get reported to FinCEN as Coinlab wants to be observant of U.S. money laundering rules.  There could be a know-your-customer (KYC) process to opening an account but Coinlab is still working on protecting anonymity.

Vessenes told Bitcoin Magazine in previous interviews last year that whoever can figure out how to store Bitcoins – in 250,000 to 500,000 blocks – and make the client feel like they are safely in a bank vault will really help make the digital currency accessible to big money investors.

The process Coinlab came up with for safety feels like a James Bond transaction with private and public keys, and they’ve gone old school storing a Rubik’s cube set of private key data in hard safes. The private keys will be split into three parts with only two needed to unlock your transaction. They won’t be stored in a computer database but printed and placed in a vault. Who can open the vault will be divided up; meaning a red team vault opener won’t be able to open the blue team’s vault.

The folks at Coinlab are also working to get your data insured for loss. Lloyds of London does these kinds of transactions but Coinlab has yet to finalize an insurance agreement. Of course they’d likely have to make sure there is a plan to make sure that the vault openers don’t get kidnapped. If they can get storage insurance they’ve just jumped the fence into Main Street’s arms.

If you want to want to buy large amounts of bitcoins without using your own cash you’ll still have to find a lender to give you leverage though — Coinlab isn’t a bank – or regulated by any US or Canadian securities or banking regulators.  But there is a hint in their new deal that shows they are working to find a way to get liquidity to Forex broker dealers or private wealth managers to help high net-worth individuals invest long-term in bitcoins.

Vessenes told Bitcoin Magazine, “Our deal with Mt.Gox means we just picked a retail customer but I care very much about the needs of the institutional investors.”
Coinlab’s strategy page has a nifty live action chart of Bitcoin liquidity which will feature a buy and sell button. The company will also work on alerts to their customers about big price swings.

“Coinlab’s deal with Mt.Gox is great for Bitcoin liquidity in the US and Canada.  It’s nice to see more formalized channels emerging here for Bitcoin FX.  This is the start of many terrific things for Coinlab and the global FX market is $4 trillion but we still have a long way to go,” Joel Yarmon of Draper Associates, who invested in Coinlab, told Bitcoin Magazine.

Jay Walker, a forex prop trader, said he’d jump to any forex broker deal that would allow him to do currency pair trades and get paid out in bitcoins. This is something the Bitcoin exchanges could do by signing deals with forex broker deals – assuming they get through each country’s regulatory process. Walker also said he’d love the opportunity to short Bitcoins. Of course to short Bitcoins some smart entrepreneur would have to come up with a credit or Bitcoin borrow system to make that happen but it’s clear the players in this field are thinking about the market demand for it.

[Bitobsessed]

Mt. Gox really wants to be 100% out of the US/Canada market.

How can you WANT to be OUT of the BIGGEST market, as a business?

This is exactly what I want to know.  There has to be more going on behind the scenes that we are not being told.  The only reason I can think of that they would want out of the US and Canadian markets is if they are being pressured by regulators in the US.  Bye, Bye Mt. Gox.

[evolve]

Yup. I think its a tax/legal liability issue, and they are shifting the risk to coinlab.

[Aseras]

Mostly trying to not deal with the US shiatty policy of making all the "citizens" indentured servants in perpetuity and harassing them out of the international banking scene.

[justusranvier]

CoinLab is going to take over servicing those accounts, and move them to Silicon Valley Bank in the US.

Future news article: 'US Government seizes $100 million from CoinLab's bank account.'

That's why I don't trade on the exchanges. I send dollars in, sell them for bitcoins, and withdraw those bitcoins to an address under my control.

[Mike Christ]

Mostly trying to not deal with the US shiatty policy of making all the "citizens" indentured servants in perpetuity and harassing them out of the international banking scene.

This.  Pretty much the reason why anything is going wrong with America; they keep thinking they can regulate everything to go their way, and it just kills whatever it touches.

[Spekulatius]

As far as I understood it: Coinlab serves as a kind of money transmitter to channel North American funds to MtGox where they are exchanged, right? Then how does Coinlab make money when all the exchange fees stay with MtGox?

[evolve]

My guess would be that MtGox is giving them a percentage of the US/CAN transaction fees in return for shouldering the risk, but I dont know for sure.

edit: Or they are going to add their own fees in addition to what mt.gox already charges.

[CecilNiosaki]

I''ll probably continue converting BTC to Lindens and then cashing out with SL. I'm not sure how this will affect things :<

[ShadowOfHarbringer]

CoinLab is going to take over servicing those accounts, and move them to Silicon Valley Bank in the US.

Future news article: 'US Government seizes $100 million from CoinLab's bank account.'

Quite possible i would say.
You never know what are these govt morons going to do.

[casascius]

Mt. Gox really wants to be 100% out of the US/Canada market.

How can you WANT to be OUT of the BIGGEST market, as a business?

This is exactly what I want to know.  There has to be more going on behind the scenes that we are not being told.  The only reason I can think of that they would want out of the US and Canadian markets is if they are being pressured by regulators in the US.  Bye, Bye Mt. Gox.

You don't think it's possible that one guy running a business may feel in over his head with an exponential growth in volume and workload and perhaps wants his life back?

I'm not him, and I've never met him, but this doesn't sound ridiculous to me.  He seems to have technical skills, not necessarily business skills, despite having done incredibly well so far.  Delegating the business end of running a business seems like a wise and prudent thing to do if you feel that a heavy workload is only going to get heavier.

[jimbobway]

Remember when Bitcoinica was transferred to Intersango? 

[Spekulatius]

Mt. Gox really wants to be 100% out of the US/Canada market.

How can you WANT to be OUT of the BIGGEST market, as a business?

This is exactly what I want to know.  There has to be more going on behind the scenes that we are not being told.  The only reason I can think of that they would want out of the US and Canadian markets is if they are being pressured by regulators in the US.  Bye, Bye Mt. Gox.

You don't think it's possible that one guy running a business may feel in over his head with an exponential growth in volume and workload and perhaps wants his life back?

I'm not him, and I've never met him, but this doesn't sound ridiculous to me.  He seems to have technical skills, not necessarily business skills, despite having done incredibly well so far.  Delegating the business end of running a business seems like a wise and prudent thing to do if you feel that a heavy workload is only going to get heavier.

How about hiring someboy?

[casascius]

How about hiring someboy?

Yeah...depends on who you are.

If you're well connected and went to a big name school and this is your fifth business venture, then finding the talented somebody is much easier than if you're a computer guy who started a business with your own code and your own hands and still trying to get over the fact that you're holding millions and soon to be tens or hundreds of millions of dollars of somebody else's money you never dreamed you'd be doing so soon.  It's not like you just place an ad on monster.com and suddenly talented trustworthy people show up and self-identify at your door - learning how to pick candidates worth hiring to fill jobs dealing with lots of real money is an acquired skill that takes years.