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Author Topic: BitCoin and Money Transmitter Laws...  (Read 1121 times)
ckoeber
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January 28, 2014, 06:14:43 PM
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So I am reading one of the latest bits on BitCoin and I stumble across this:

Quote
Money Transmitters

Stephanie Newberg, president of the Money Transmitter Regulators Association, a group of state officials, said Bitcoin will dominate her association’s agenda precisely because its legal status is unclear.

“Some states have statutes that are broad enough to do it immediately,” said Newberg, who is also deputy commissioner of banking in Texas. “Other states don’t. It’s a state-by-state question.”

JPMorgan Chief Executive Officer Jamie Dimon has said he expects that Bitcoin will be less of a threat once regulators intervene.

Bitcoin “will eventually be made as a payment system, I think, to follow the same standards as the other payment systems, and that will probably be the end of them,” Dimon said Jan. 23 in an interview on CNBC.


Bitcoin was introduced in 2008 by a programmer or group of programmers under the name Satoshi Nakamoto. It has no central issuing authority, and uses a public ledger to verify encrypted transactions.

Successful virtual currency startups will have to commit to being regulated by the states, said Fred Ehrsam, chief executive of Coinbase in San Francisco, a company that helps users buy and sell Bitcoin.

“We think California and New York will set the tone for everything else,” Ehrsam said. “When that tone is established, we’re ready to hand in licensing applications immediately.”

My question is this; and this goes out to financial experts more than anything else:

How will complying with "money transmitter" laws affect BitCoin and who will be affected?

I am not trying to say this will be good/bad; I simply don't know what this means as I don't know these laws.

Thank you for anyone who can answer this.
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BTCisthefuture
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January 28, 2014, 06:31:15 PM
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From what I understand the biggest points in money transmitter laws are AML (anti money laundering) and KYC (know your customer).  In other words, you need to provide valid to ID to do transactions through that service. Just like paypal and now most btc exchanges require.

I could be wrong though, correct me if I am.

Hourly bitcoin faucet with a gambling twist !  http://freebitco.in/?r=106463
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January 28, 2014, 06:39:07 PM
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There just might be a way around the state. This doesn't mean they won't give you a hassle.

See my post on page 13 of "Why Bitcoin is doomed to fail, and there's nothing you can do about it."

https://bitcointalk.org/index.php?topic=372303.240

Smiley

whtchocla7e
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January 28, 2014, 06:43:43 PM
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Stop exchanging Bitcoin for money and no money transmitter law will apply to Bitcoin...
ckoeber
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January 28, 2014, 06:46:20 PM
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Stop exchanging Bitcoin for money and no money transmitter law will apply to Bitcoin...

But what if you buy stuff with BitCoin; will any laws apply to transactions like that?

I am not sure that as long as BitCoin is not exchanged for money we are in the clear...
AllanAV
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January 29, 2014, 02:57:16 AM
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The only problem I see is the exchange houses would be forced to get these licenses in order to operate in the state, even if their headquarters are not located in the state of NY, so many exchange houses will decide to not do business with Americans as to avoid having to comply with such regulations and the ones that decide to get these licences will pass on the cost to its costumers.
The few of us that have dual citizenship can always apply with documentation from other country, some will resort to fake documentation and the few that don't will be forced to pay higher fees or yearly subscription in order to subsidize these licenses.     
Sonny
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January 29, 2014, 03:03:46 AM
 #7

Stop exchanging Bitcoin for money and no money transmitter law will apply to Bitcoin...

But what if you buy stuff with BitCoin; will any laws apply to transactions like that?

I am not sure that as long as BitCoin is not exchanged for money we are in the clear...

What if I trade my melon for an apple pie?
I hope I didn't break any money transmitter laws....   Wink
AllanAV
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January 29, 2014, 03:08:35 AM
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What if I trade my melon for an apple pie?
I hope I didn't break any money transmitter laws....   Wink

Comments like this makes me wish I could up vote posts like in Reddit!   Smiley
ckoeber
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January 29, 2014, 03:45:34 AM
 #9

Stop exchanging Bitcoin for money and no money transmitter law will apply to Bitcoin...

But what if you buy stuff with BitCoin; will any laws apply to transactions like that?

I am not sure that as long as BitCoin is not exchanged for money we are in the clear...

What if I trade my melon for an apple pie?
I hope I didn't break any money transmitter laws....   Wink

Heh, point made...
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