Dwolla stops support for virtual currencies

[rbdrbd]

I received the following email from Dwolla today:

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Dear Dwolla Account Holder,

As you know, Dwolla does not sell, accept, mine, value, take possession of, or hold Bitcoin or any other virtual currency product, and none of Dwolla’s users transact business with Dwolla using Bitcoin or any other virtual currency product. However, recent interest involving virtual currency and its exchanges has created uncertainty and confusion around virtual currency, and Dwolla's relationship with a small number of its exchanges. This has forced Dwolla to reassign resources, funds, and services.

As Dwolla gears up for a new stage of growth, we recognize that we can no longer sustain this merchant base (.1 percent of Dwolla merchants) and its unique needs, and that attempting to do so jeopardizes both of our communities' starkly different, but similarly ambitious, vision for improving payments.

Effective October 28, 2013 at 4pm CT, Dwolla will be withdrawing its service offerings to virtual currency exchanges and virtual currency related services.

What does this mean?
•   Your account, and its functionality, will remain unaffected. However, you can deactivate your account from within your Dwolla dashboard, if you so choose.
•   Dwolla aims to provide its users and the few affected merchants with the guidance necessary to ensure a smooth transition. To do that, we encourage users to over-communicate with our support team, report any suspicious activity, and revisit our terms of service to ensure uninterrupted services.
What is the timeline of events?
1.   October 10: Only existing users with a 30-day history with Dwolla will be able to send funds to merchants affected by this change.
2.   October 15: Affected merchants will be limited to sending money only, and will no longer be able to receive funds from customers. They will be able to issue refunds to customers at this time.
3.   October 28: Affected merchants’ accounts will be suspended. No further activity will be provided.
4.   October 29: Provided no security or fraud concerns, Dwolla will transfer any of the remaining funds inside the affected merchant's Dwolla account to its linked bank account.
The decision to remove anyone from the network -- no matter the circumstances -- is not something Dwolla takes lightly. We are grateful for the opportunity to service and learn from these users. We wish the community and its pioneers the best.

Sincerely,
Dwolla Support

[1713529056]

1713529056

[FullLife]

Just received this email as well.

[tclo]

Yes I just got this email and that is bad bad bad for me, because I use Dwolla with CampBX all the time...damn.

The War on Bitcoin continues...

[ForceField]

I can confirm that I also received the same email.

This is yet another restricting factor on Bitcoin's liquidity.

[FullLife]

Yes I just got this email and that is bad bad bad for me, because I use Dwolla with CampBX all the time...damn.

The War on Bitcoin continues...

I used the same method, and I'm sure plenty of other people did as well.  I guess we're down to USPS money orders now.

[JackH]

So a lesser used system, on the brink of disappearing into the unknown (especially when compared to Bitcoin) drops the usage of allowing people to convert into BTC? Sounds like a suicide attempt. Honestly, nobody knows what Dwolla is, its a niche system, and we should move on and leave them die without dignity.

[btceic]

It just means that they are taking bitcoin away from the "little hands" so that it can "safely" go onto the "real" exchanges aka nyse, nasdaq etc. I expect that we will experience some serious volatility very soon and then quiet and then some seriously good news. If you have the balls to hold or purchase through the dips that are sure to come then you should come out alright.

[ralree]

Go deactivate your account and email them to let them know why.

[FullLife]

So a lesser used system, on the brink of disappearing into the unknown (especially when compared to Bitcoin) drops the usage of allowing people to convert into BTC? Sounds like a suicide attempt. Honestly, nobody knows what Dwolla is, its a niche system, and we should move on and leave them die without dignity.

Dwolla isn't going anywhere, they seem to be doing quite well actually.

[tclo]

Go deactivate your account and email them to let them know why.

Yes I'm going to deactivate my account out of principle, if nothing else.

[rampantparanoia]

considering i only used this service to send money to campbx, I'll be deactivating. Also won't be using campbx anymore.

[btceic]

considering i only used this service to send money to campbx, I'll be deactivating. Also won't be using campbx anymore.

Anybody see an easy 1 click way to deactivate your dwolla account? It is quite possible that I missed the link or button...

[Cubic Earth]

I think this is going to hurt CampBX much more than it will Dwolla, and it for Bitcoin it is only a matter of wounded pride.  Now the only way to get money to them is by using postal mail via money orders or personal checks.  No wire transfers, no ACH.

I probably should cancel my Dwolla account out of protest, but I also may keep it for my own self interest, just in case Dwolla changes their mind.

My average revenue-generating Dwolla transaction was probably $1,500 - $2,000, so I can see the $0.25 fee not being worth it to them.  And forget about any interest, most of my transactions passed into and out of Dwolla within minutes.

[rampantparanoia]

I think this is going to hurt CampBX much more than it will Dwolla, and it for Bitcoin it is only a matter of wounded pride.  Now the only way to get money to them is by using postal mail via money orders or personal checks.  No wire transfers, no ACH.

Agreed. Why send a MO when you can sell for cash on localbitcoins?
CampBX, I'm sorry but your days are numbered.

[mccoyspace]

I got this message from them on Tuesday. They are about to introduce new features and I think they see Bitcoin as competition. They don't want to support the development of their competor.

   
Reserve your seat.
We’ve been working on something we’re pretty excited about, something that will:
Allow you to buy the things you love, immediately
Introduce a new level of convenience to the community
Carry the same low transaction fee
Introduce some new friends to the platform
Open up the network to new ideas and possibilities

[yvv]

Yes I just got this email and that is bad bad bad for me, because I use Dwolla with CampBX all the time...damn.

The War on Bitcoin continues...

It is not the war, it is ignoring. Crypto coin adopters are freaking negligible number of people, and this number is not going to grow in observable future. Who would bother about 0.1% of customers?

[JackH]

I got this message from them on Tuesday. They are about to introduce new features and I think they see Bitcoin as competition. They don't want to support the development of their competor.

   
Reserve your seat.
We’ve been working on something we’re pretty excited about, something that will:
Allow you to buy the things you love, immediately
Introduce a new level of convenience to the community
Carry the same low transaction fee
Introduce some new friends to the platform
Open up the network to new ideas and possibilities

LOL! Really? This is just yet another centralized system among, what, 50? Seriously, we dont need Dwolla, Bitcoin has grown bigger than this piece of shit system, and as many others they will realize they will fail at the idea of "we will hold your money safe".

[tclo]

Yes I just got this email and that is bad bad bad for me, because I use Dwolla with CampBX all the time...damn.

The War on Bitcoin continues...

It is not the war, it is ignoring. Crypto coin adopters are freaking negligible number of people, and this number is not going to grow in observable future. Who would bother about 0.1% of customers?

They aren't "ignoring" their bitcoin customers if they are actively going out of their way not to service their accts, and lose business in the future.   

It may not even be Dwolla's fault and probably the US gov't (backed by Bankers) putting the pressure on them.

[btc4ever]

Why the Only Real Way to Buy Bitcoins Is on the Streets
http://www.wired.com/wiredenterprise/?p=47251

[impulse]

I don't live in the States and so I am not intimately familiar with how Dwolla works, so what makes them special? How are they different from other payment systems like Paypal? Why can't a Bitcoin company replicate their success?