How Western Union could bring bitcoin to everywhere in the world

[jl2012]

I think Western Union could bring bitcoin to everywhere in the world without any infrastructural change.

Users who want to buy bitcoin could pay at a WU outlet with an agreed exchange rate. They will fill-in a remittance form to indicate the recipient country as "Bitcoin" and the recipient address as a bitcoin address. The request will be forwarded to the WU headquarter, which will send the bitcoin to the destination.

Users who want to sell bitcoin will send bitcoin with the WU website, and collect fiat at the preferred WU outlet.

Since the outlets woun't touch bitcoin at all, basically they could bring bitcoin to everywhere in the world without upgrading any outlet. They just need to allow a new dummy country code called "Bitcoin", and allow a weird address as the recipient.

Thoughts?

[/dev/null]

I doubt they are ever going to do this.

[moni3z]

Wu won't touch bitcoin, not only is it a competitor but they are forbidden to do anything except remit money. That's why they seize accounts using it for trading because you're not allowed to. Wu's only function is sending under $900 per month to family members and they make trillions doing it. Bitcoin threatens that, because less fees. They also make the bulk of their money in currency conversion fees, something that's difficult to do on a trillion dollar scale with bitcoins.

No major finance corporation will touch bitcoin if anything they will come up with WUcoin, a highly centralized and ID required coin that traces everything you do.

[JoelKatz]

I think Western Union could bring bitcoin to everywhere in the world without any infrastructural change.

Users who want to buy bitcoin could pay at a WU outlet with an agreed exchange rate. They will fill-in a remittance form to indicate the recipient country as "Bitcoin" and the recipient address as a bitcoin address. The request will be forwarded to the WU headquarter, which will send the bitcoin to the destination.

Users who want to sell bitcoin will send bitcoin with the WU website, and collect fiat at the preferred WU outlet.

Where do they get the Bitcoins from? What do they do with the Bitcoins they receive? How do they handle exchange rate risk? How do they handle regulatory compliance?

[DeathAndTaxes]

They could however they will only support Bitcoin in the "late game".  They have a high margin business that has high barriers to entry.  $50 to send $500 on tens of billions of USD a year.  10%+ what an awesome racket.  Bitcoin can only hurt those margins.  Now if Bitcoin continues to grow at some point in the future they will face a decision adapt or be bypassed but we are talking adoption 100x higher than now at a minimum. 

Nothing prevents them from doing that and you are right they have the infrastructure in place however just like PayPal and other "vested" enterprises they aren't going to do anything to rock the boat.  Those companies margins are based on the fact that it will cost a competitor tens of millions if not a hundred million to build out a comparable network.  To make money all they got to do is not mess that up.

[DeathAndTaxes]

I think Western Union could bring bitcoin to everywhere in the world without any infrastructural change.

Users who want to buy bitcoin could pay at a WU outlet with an agreed exchange rate. They will fill-in a remittance form to indicate the recipient country as "Bitcoin" and the recipient address as a bitcoin address. The request will be forwarded to the WU headquarter, which will send the bitcoin to the destination.

Users who want to sell bitcoin will send bitcoin with the WU website, and collect fiat at the preferred WU outlet.

Where do they get the Bitcoins from? What do they do with the Bitcoins they receive? How do they handle exchange rate risk? How do they handle regulatory compliance?

They already ARE subject to regulatory risk and they ALREADY have spent tens of millions to become compliant in the US and dozens of countries.  As for exchange rate risk they are subject to that in fiat to fiat transactions.  Given their hefty margins and the fact that just like any other exchange people will want to buy and sell they could float a small amount of Bitcoins as working capital and accept the risk on that.  Much like they do with fiat exchange rates if the intra-hour volatility is "too high" they can always give customers a worse rate. I mean by your logic coinbase and bitpay can't work either right?  Yet they do.  WF would bring "down the street" access to a billion or more people on the planet. 


Still this isn't going to happen anytime soon for complete different reasons (see my post above).

[moni3z]

There's plenty of other money transfer companies if you want to harass them to accept bitcoin (they won't, but you could try) like Anelik, Contact-sys, Migom, about a million others. No reason to be US centric since the US is the death of all financial innovation.

One country that could use a currency is CAR. It's basically a failed state at this point, and people are looking to use a mobile currency like what they use in Somalia. Mobile currency basically replaced Somali shillings because you need a wheelbarrow to carry around $10 worth of Shillings. Start a mobile currency backed by bitcoin so people can trade with SMS instead of holding wallets, expand to take over the world

[smoothie]

I doubt they are ever going to do this.

Fees might entice them. But then again if the bankers don't like them using or promoting bit coin they do not have much choice.

Essentially it boils down the the banking cartel/elite.

[JoelKatz]

They already ARE subject to regulatory risk

Right, because Bitcoins present the same regulatory risk as dollars.

I mean by your logic coinbase and bitpay can't work either right?  Yet they do.

And by your logic, these companies can't make any money because the problems they solve don't exist.

[DeathAndTaxes]

They already ARE subject to regulatory risk

Right, because Bitcoins present the same regulatory risk as dollars.

In the US Bitcoin exchangers are money transmitters.  WU is a money transmitter.  

WU is registered with FinCEN
WU has a MT license in every state which requires one.
WU has surety bonds in every state which requires one (by the regs it is in excess of $20M face value)
WU has an AML program.
WU has AML training for employees.
WU has a BSA compliance/audit team.
WU collects and records KYC information.
WU blocks suspicious transactions.
WU files various MT related transaction reports with FinCEN.
WU keeps transaction records as required by FinCEN and state regulators.
WU implements per tx and per day limits for customers in accordance with FinCEN and State MT programs.
WU has the legal teams, the size, and the industry contacts to get direct answers from regulators.

Per FinCEN guidance WU is ALREADY doing everything they need to be a 100% compliant Bitcoin exchanger.  So yeah if there is ANYONE on the planet which has the compliance structure already in place it would be WU.  Still they aren't going to support Bitcoin until it is "game over" for the business model.  If/when Bitcoin is is so pervasive that they are losing revenue, they will consider offering bitcoin exchange services not before.

[jl2012]

And by your logic, these companies can't make any money because the problems they solve don't exist.

I think no one is saying that these problems don't exist. WU is already dealing with the risk of currency volatility, so this is nothing new to them.

They can also use Winkelvoss ETF to hedge the risk.

Where do they get the Bitcoins from?

From bitcoin sellers. If that's not enough, buying from gox.

What do they do with the Bitcoins they receive?

Send to bitcoin buyers. If they hold too much, sell at gox.

[jl2012]

They already ARE subject to regulatory risk

Right, because Bitcoins present the same regulatory risk as dollars.

In the US Bitcoin exchangers are money transmitters.  WU is a money transmitter.  

WU is registered with FinCEN
WU has a MT license in every state which requires one.
WU has surety bonds in every state which requires one (by the regs it is in excess of $20M face value)
WU has an AML program.
WU has AML training for employees.
WU has a BSA compliance/audit team.
WU collects and records KYC information.
WU blocks suspicious transactions.
WU files various MT related transaction reports with FinCEN.
WU keeps transaction records as required by FinCEN and state regulators.
WU implements per tx and per day limits for customers in accordance with FinCEN and State MT programs.
WU has the legal teams, the size, and the industry contacts to get direct answers from regulators.

Per FinCEN guidance WU is ALREADY doing everything they need to be a 100% compliant Bitcoin exchanger.  So yeah if there is ANYONE on the planet which has the compliance structure already in place it would be WU.  Still they aren't going to support Bitcoin until it is "game over" for the business model.  If/when Bitcoin is is so pervasive that they are losing revenue, they will consider offering bitcoin exchange services not before.

I think ButterCoin is trying to run the WU model. They will work with local licensed money transmitter to avoid all those compliance issues.