So what i have gathered so far seems to be indicating that gox is being investigated for operating a money transfer service and this has been defined by the FinCen guidance (and explicitly described in the warrant) as involving an alternative currency (BTC). Therefore if Gox are found in court to have broken this law there would be a legal precedent that Bitcoin is recognised as a currency.
Could any one with better undertanding of this matter please correct me if I am wrong.
I have had a look at the affidavit. As far as I can tell, the position seems to be as follows:
1. A dwolla account holder sells his bitcoins and requests the withdrawal of his dollars to his Dwolla account.
2. Instead of Mt Gox sending those dollars directly to the customer's Dwolla account, instead it sends them to its subsdiary company ("Mutum") which is a Delaware company with an account at Wells Fargo in the U.S.
3. Mutum then sends the funds onwards to the customer's Dwolla account.
4. Mutum is thus acting as a money transmitting business but is not licensed to do so.
5. The Department of Homeland Security has obtained an order from the Maryland District Court freezing the contents of the account of Mutum at Wells Fargo.
A number of points arise:
1. The action is against Mutum rather than Mt Gox.
2. It is unclear whether the DHS may argue in future that Mt Gox (which is a Japanese company) breaches US law by making direct payments to U.S. individuals and companies. But this is not the issue in this case, though it something that I am sure Mt Gox is considering very carefullly..
3. It is unclear why Mt Gox uses Mutum as an intermediary rather than simply remitting funds directly to U.S. customers.
4. It is unclear what any of this has to do with the Department of Homeland security
5. The affected funds are those which were in transit from Mt Gox via Mutum to customer Dwolla accounts as at the date of the freezing order. Quantity unknown.
6. It is unclear how Mt Gox will, in future, remit funds to Dwolla accounts.
7. The freezing order is purely because Mutum acts as a money transmitting business of USD as between Mt Gox and customer dwolla accounts. It has nothing to do with the transmission by Mt Gox of BTC purchased by clients (whether in the U.S. or elsewhere).The position would be exactly the same if Mt Gox were a precious metal exchange. The freezing order is directly at the U.S. proceeds of sale being remitted via a U.S. subsidiary to dwolla accounts.
