Why is UK so slow to jump on this?

[stereotype]

As a UK based bitcoin enthusiast, and someone with a number of years as a business advisor, I have been looking at the UK bitcoin market to find a way to take advantage of the opportunity.

The biggest problem is that the UK is getting very risk averse and so anything which can be regulated, tends to get regulated as soon as someone can lobby for it.  Its getting very expensive to get into any market which involves anything to do with the finance industry. It is possible to start up under the branding of a partner, however, with no such regulations for bitcoin, its a bit of a zombie industry.

I would like to see if its possible to start an exchange based on bitcoin trading being entertainment and gaming, but that then puts you under the gambling regulations, which are possibly even harder to work with!

The main problem with the UK is that it has two masters.  The EU sets its directives, and UK agencies interpret them into laws and policies.  When it comes to business, bosses have to worry about satisfying both the local enforcing agencies as well as national agencies; all of them have to find things to get involve with to justify their funding - allegedly!

Running a business in the UK is hard work!

Could you create a 'derivative' of a given exchange, that takes the form of a game in some way? Like a 'guess where the market will be in...."?, and sell people 'credits' (btc) to play. So the site starts with a pot in an account, that buys on another exchange when a client wants to 'play'.

Just thinking out loud.

[yucca]

I think once coinlab in US starts running then UK will follow, coinlab is actually going to have insurance for holdings via Lloyds of london, so the city boys know all about it.

[qukkM]

would a UK version of coinlab require the same regulatory approval as an exchange? as I see it coinlab sell you a certain number of BTC at a set price, selling it as a commodity rather than being involved in a currency exchange. It would seem to me that would be much easier to operate as you would essentially be selling virtual goods as opposed to currency trading. I have seen an offer for a uk based site in the marketplace run along similar lines and was considering it's potential.

[stereotype]

I think once coinlab in US starts running then UK will follow, coinlab is actually going to have insurance for holdings via Lloyds of london, so the city boys know all about it.

Sounds positive. Is there a time frame for that?

[stereotype]

would a UK version of coinlab require the same regulatory approval as an exchange? as I see it coinlab sell you a certain number of BTC at a set price, selling it as a commodity rather than being involved in a currency exchange. It would seem to me that would be much easier to operate as you would essentially be selling virtual goods as opposed to currency trading. I have seen an offer for a uk based site in the marketplace run along similar lines and was considering it's potential.

Hmmm. What about selling a blank casacius coin as a commodity, that is loaded by the client to 'play' with. Does that redefine any regulatory requirements, or obviate anything for the better? I guess that question may end up being rhetorical!

[Scott J]

would a UK version of coinlab require the same regulatory approval as an exchange? as I see it coinlab sell you a certain number of BTC at a set price, selling it as a commodity rather than being involved in a currency exchange. It would seem to me that would be much easier to operate as you would essentially be selling virtual goods as opposed to currency trading. I have seen an offer for a uk based site in the marketplace run along similar lines and was considering it's potential.

Hmmm. What about selling a blank casacius coin as a commodity, that is loaded by the client to 'play' with. Does that redefine any regulatory requirements, or obviate anything for the better? I guess that question may end up being rhetorical!

That's an interesting thought - how about a casascius coin that won't be funded until a certain date, that could dodge some regulations?   

[Lethos]

The problem with avoiding the regulation wasn't always with making sure you were doing everything within the law and the related regulations.

It's that because there are still grey areas on how to regulate Bitcoin, in the traditional banking structure, the banks all too often, when faced with them being in trouble, would rather shut you down, than have to deal with the paper work (and investigation) of seeing if you were being compliant. Because proving you were and they ensured you were (which they can't since they don't understand bitcoin), is a problem they don't want to be faced with.

[Nancarrow]

I really liked Intersango. Then one UK bank after another stomped on them! 

There still appears to be a small GBP market on Intersango, but it has absolutely huuuuuge spreads at the mo. And you can withdraw GBP to your own bank account with a bank transfer, but no way to get GBP into Intersango. Either have to use MtGox, or keep hold of my bitcoins.

OTOH: silver lining, it means I have kept hold of my bitcoins over the last year, instead of selling them off in batches to pay off my mining rigs. This has turned out to be an exceedingly good thing! 

[oakpacific]

Good old days of britcoin come back, when I used to be able to credit my exchange account in one day with no fees whatsoever incurred.

[phelix]

Wondering what other Brits think about the Bitcoin market in the UK. Specifically, what do you think about not having a professional, fully functioning, recognized Xchange somewhere in the UK, trading high volume GBP/BTC liquidity?

From a forward-thinking, enterprising perspective, im kinda thinking that the usual entrepreneurial Brit with funds, has missed this boat a little. Sure, business opportunities in Bitcoin are going to present themselves, as we go on, but currently, im just bombarded with USD biased experiences/interactions, wherever i navigate. Someone correct me if im wrong, but i don't even think https://bitbargain.co.uk/ is UK owned.

So, any smart UK centric business bods out there, care to share any current projects. Do you need help?
 

Just a thought, and most definitely not a invitation to swap nationalistic nonsense!

It's the same with Germany. I am not aware of any real exchange with some depth and German language.

[stereotype]

would a UK version of coinlab require the same regulatory approval as an exchange? as I see it coinlab sell you a certain number of BTC at a set price, selling it as a commodity rather than being involved in a currency exchange. It would seem to me that would be much easier to operate as you would essentially be selling virtual goods as opposed to currency trading. I have seen an offer for a uk based site in the marketplace run along similar lines and was considering it's potential.

Hmmm. What about selling a blank casacius coin as a commodity, that is loaded by the client to 'play' with. Does that redefine any regulatory requirements, or obviate anything for the better? I guess that question may end up being rhetorical!

That's an interesting thought - how about a casascius coin that won't be funded until a certain date, that could dodge some regulations?   

The idea is still working for me. How about a 'subscription' to load the pre sent coin?
I am obviously just thinking out loud, so someone please shoot me down, before i convince myself its a go-er!

[nwbitcoin]

The biggest problem is that this is seen as a financial product or sorts.
If it was a virtual product, like a phone credit, it would not have to go through all these hoops in Europe.

Maybe the real answer is that as users with a drive to make bitcoin work in the UK and the EU, its up to us to define its position, rather than wait for the banks and government to do it for us?

If we are calling it a currency, its financial, and its going to be regulated to death.

If we call it an e-commerce voucher, the cat is still in the bag?

This might have legs?

[stereotype]

The biggest problem is that this is seen as a financial product or sorts.
If it was a virtual product, like a phone credit, it would not have to go through all these hoops in Europe.

Maybe the real answer is that as users with a drive to make bitcoin work in the UK and the EU, its up to us to define its position, rather than wait for the banks and government to do it for us?

If we are calling it a currency, its financial, and its going to be regulated to death.

If we call it an e-commerce voucher, the cat is still in the bag?

This might have legs?

From what SBC was saying on his insightful post, Bitcoin is currently not recognised as something that needs to be regulated as a currency by the relevant authorities. However, reading between the lines, and sensing how this market is going to develop, its only a matter of short time before that status will change. So yes, re-defining has to be the way to go for the long term. I like the 'us define the position', and we can do that to a certain degree (call it vouchers, credits, collectable coin etc.), but you still have to convince the bank to keep your account open, in the face of doubt and weak or no precedence, in their minds, but Im not hearing a fat lady sing yet, nwbitcoin.

[Pteppic]

I think once coinlab in US starts running then UK will follow, coinlab is actually going to have insurance for holdings via Lloyds of london, so the city boys know all about it.

I would have thought that coinlab got insurance on Lloyds of London because that is just about the only place in the world that would consider providing a high sum assured contract covering Bitcoins.

I also think the UK is suffering due to the hurdle you have to get over just to get involved in Bitcoin. If you can't get bitcoin quickly and easily, it limits the number of people getting involved. Then you get a chicken and egg situation - a well-backed UK exchange that could meet the regulatory burden would probably be successful. But without one, there are not enough UK users to justify setting one up.

[stereotype]

I think once coinlab in US starts running then UK will follow, coinlab is actually going to have insurance for holdings via Lloyds of london, so the city boys know all about it.

I would have thought that coinlab got insurance on Lloyds of London because that is just about the only place in the world that would consider providing a high sum assured contract covering Bitcoins.

I also think the UK is suffering due to the hurdle you have to get over just to get involved in Bitcoin. If you can't get bitcoin quickly and easily, it limits the number of people getting involved. Then you get a chicken and egg situation - a well-backed UK exchange that could meet the regulatory burden would probably be successful. But without one, there are not enough UK users to justify setting one up.

I think one way to get people involved, is to make something attractive. In the context of an exchange, one attractive element is liquidity/participation. The way to create that, is to initially have a prop trader churning over volume. How much cost/risk is implied here, is probably above my pay grade, but i for one, would be very happy to sit and churn required volume all bloody day!

 

[nobbynobbynoob]

I also think the UK is suffering due to the hurdle you have to get over just to get involved in Bitcoin. If you can't get bitcoin quickly and easily, it limits the number of people getting involved. Then you get a chicken and egg situation - a well-backed UK exchange that could meet the regulatory burden would probably be successful. But without one, there are not enough UK users to justify setting one up.

Agreed. Peer-to-peer exchange / LocalBitcoins / Bitcoin-OTC type stuff may have to take up the slack. It may already be doing so, for all we know.

[stereotype]

I also think the UK is suffering due to the hurdle you have to get over just to get involved in Bitcoin. If you can't get bitcoin quickly and easily, it limits the number of people getting involved. Then you get a chicken and egg situation - a well-backed UK exchange that could meet the regulatory burden would probably be successful. But without one, there are not enough UK users to justify setting one up.

Agreed. Peer-to-peer exchange / LocalBitcoins / Bitcoin-OTC type stuff may have to take up the slack. It may already be doing so, for all we know.

Funny you mention that. Martin from   https://bitbargain.co.uk/  has just directed me to something else to consider .... https://bitcointalk.org/index.php?topic=157433.msg1667551

Thanks

[whitenight639]

Britons are, for what ever reason, particularly indoctrinated. They tend to be more prone to using government to "solve" societal problems (that were caused by government in the first place but thats neither here nor there) and less interested in accepting market based approaches. Britons tend to see the market and government in polarized light of government being the source of all things good and the market being the source of all things bad. Where as Americans see government as a begrudgingly necessary evil, Britons tend see the market as a begrudgingly necessary evil.

anyway i should expect this to cause the UK to be a bit behind the curve in all things bitcoin

This ^^


I'm British, I think most of the populace is addicted to Eastenders, it's ok they'll e the first to go hungry when either the euro or the dollar collapses.

The problem is Bitcoins are too hard to understand for most people even with bitcoin.org and the wikis its too much for people, we need to collate the info and dumb it down even more. As for Trading platforms people are just too scared of the risks, nobody wants there front door smashed in by the police for some website exchange that's been misunderstood and is probably costing money to get started.

The big city boys don't care much for regulations they just make up new names for things and do it, ETF, Futures, CDOs it's all bullshit if you had a legal department backing you up like they do you would call bitcoins "Blockchain space" and carry on doing what your doing.

[redbeans2012]

The biggest problem is that this is seen as a financial product or sorts.
If it was a virtual product, like a phone credit, it would not have to go through all these hoops in Europe.

Maybe the real answer is that as users with a drive to make bitcoin work in the UK and the EU, its up to us to define its position, rather than wait for the banks and government to do it for us?

If we are calling it a currency, its financial, and its going to be regulated to death.

If we call it an e-commerce voucher, the cat is still in the bag?

This might have legs?

Maybe you can just sell bitcoin wallets

[nwbitcoin]

The biggest problem is that this is seen as a financial product or sorts.
If it was a virtual product, like a phone credit, it would not have to go through all these hoops in Europe.

Maybe the real answer is that as users with a drive to make bitcoin work in the UK and the EU, its up to us to define its position, rather than wait for the banks and government to do it for us?

If we are calling it a currency, its financial, and its going to be regulated to death.

If we call it an e-commerce voucher, the cat is still in the bag?

This might have legs?

Maybe you can just sell bitcoin wallets

The UK public is very, very stupid and scared.  Not sure when it happened, but nobody seems to want to take a risk anymore, unless the government tell them its ok.

It does seem to me that selling bitcoin voucher books in the form of paper wallets would actually have legs.

Its also quite easy to prove that the wallets have credits in them (see what I did there?   with a blockexplorer on your phone

Maybe that is the future for uk bitcoins - under the radar inflation proof internet vouchers that are accepted internationally - and can be sold in a boot sale?!

The return of the green shield stamps ?