NY just announced a MANDATORY Bitcoin license - if this concerns you sign this.

[minerdetail]

I don't think that regulation of some sort necessarily is bad, but unfortunately it points in that direction 

Minor regulation could be seen as a white listing of Bitcoin and thereby make it easier to act legally within the boundaries.

Something I don't like about USA (living in Denmark) is that it seems that people can get arrested with an alleged law (non-written) and then be accused of violating another weird law.
It seems that the legal certainty in USA has disappeared more and more over the last decade.

Wonder what the capital requirements could be that are mentioned in that article at Reuters?

[DaFockBro]

smh at people calling for regulation.

The unregulated nature of Bitcoin is what attracted people in the first place and has allowed for explosive growth.

If you give them an inch of regulation, they take a mile.  The next step will be more regulation, and after that, even more regulation, then when they're done with that they'll try to regulate some more.

The only way to stop a bad guy with bitcoins is with a good guy with bitcoins

[vaccinesaregood]

Regulation is a good thing.  It allows outsiders to be able to trust bitcoiners.  We should be applauding this move.

[DaFockBro]

Regulation is a good thing.  It allows outsiders to be able to trust bitcoiners.  We should be applauding this move.

"He gazed up at the enormous face. Forty years it had taken him to learn what kind of smile was hidden beneath the dark moustache. O cruel, needless misunderstanding! O stubborn, self-willed exile from the loving breast! Two gin-scented tears trickled down the sides of his nose. But it was all right, everything was all right, the struggle was finished. He had won the victory over himself. He loved Big Brother."

[PT17pilot]

The article I read had a line in it that they were considering regulating miners also, not just exchanges or gateways to FIAT. 

SOME regulation of exchanges might be good and lend legitimacy to the cryptocurrenncies.  Things like deposit insurance or minimum levels of capitalization so runs don't crash the exchange.  That would also take some volatility out of the market and make it more attractive to merchants.  The bad result could be if they try to treat BTCs like FIAT with regulations like 'know your customer' that go against the grain of the peer-to-peer architecture.  THAT could take a serious bite out the attractiveness of BTCs and all cryptocurrencies and will force everyone offshore.  But even then FACTA laws in place today would restrict exchange operators desriing anonymity to third world locales.

[bitpop]

Lawsky seemed pretty good in the hearings. But I was expecting a hearing on how to destroy Bitcoin so anything was positive.

[Melbustus]

Signed it. Agree with most of what you wrote...

The problem is regulators' incentives. If they're free to keep the grand, historical vision of American freedom and innovation in mind, much of the letter may indeed resonate with them. But I think unfortunately therir jobs and the nature of politics is a huge enemy here. We have to understand that they are going to be judged on the amount of financial crime taking place, or more specifically, the amount of financial crime they can somehow measure that they're stopping due to the regs they put in place. And equally unfortunately, on the flipside, they will be held politically accountable if financial crime takes place in a very public way (eg, Madoff). Their primary instinct is probably to never get accused of being "asleep at the wheel". Thus, for their own reputation and job security, they'll likely err on the side of more regulation, despite how much (if at all) the freedom argument may actually resonate with them.

I think we need to fully understand that dynamic and figure out how to meet their concerns and motivations while promoting our own cause. I hope the two are not mutually exclusive.

Of course, maybe Lawsky is an exceptional guy and *will* understand the greater arc of history here. Who knows.

[BruceFenton]

Signed it. Agree with most of what you wrote...

Yes, the motivation is key.

I've asked him for a meeting.

Politicians care about public perception and vote.  It can be a concern over the public being angry about the next Maddoff or it could be concern over jobs! innovation and the economy.

If he will meet my goal will be to show him all the negative things that can happen from too much regulation, all the jobs and positive effect of low to no (new) regulation -- and also that it's not a binary either/ or case of one must regulate Bitcoin in order to stop terrorism etc..... I'd argue that the regulation may not work and even if not regulated there are still many good time tested police investigative methods which can be used to catch criminals.

[marcus_of_augustus]

Somebody somewhere wants to license bits ...

Wil-E coyote moment as they look down and realise just how far out over the cliff they have gone?

The widepsread monetary insanity and confusion has no limits it seems.

[BruceFenton]

Somebody somewhere wants to license bits ...

Wil-E coyote moment as they look down and realise just how far out over the cliff they have gone?

The widepsread monetary insanity and confusion has no limits it seems.

The real insanity is people in our own industry emphatically saying "I want regulation" and when pressed for an answer why they reply "because it's coming anyway"

[DeathAndTaxes]

Somebody somewhere wants to license bits ...

Wil-E coyote moment as they look down and realise just how far out over the cliff they have gone?

The widepsread monetary insanity and confusion has no limits it seems.

The real insanity is people in our own industry emphatically saying "I want regulation" and when pressed for an answer why they reply "because it's coming anyway"

The bureaucracy is expanding to meet the expanding needs of the bureaucracy.

[Holliday]

The bureaucracy is expanding to meet the expanding needs of the bureaucracy.

[Trance]

Don't worry! This can only mean ONE thing!

"Better Call Saul!"

[Armis]

Everyone should weigh in because this isn't simply about bitcoin in NY State, its precedence for cryptocurrency of all sorts for NY, and it will be viewed by other states as a guide, and as other states adopt or reject it it will create an international impression.  

Personally I favor self-regulation for btc and the whole CC industry.  I feel that after the CC industry has provided a road map and design for self-regulation, then the govts on all levels could weigh in appropriately.   The Bitcoin Foundation really dropped the ball on this one, but its not too late for many other states, the country, and other countries.  

NY is only demanding a license, but with any govt intervention goes rules, regulations, and fees, followed by fines and punishments.  

[BruceFenton]

This license won't be something like a drivers license ....it will require continual and ongoing compliance, audits and more and more regulations governing it.

[BCB]

Somebody somewhere wants to license bits ...

Wil-E coyote moment as they look down and realise just how far out over the cliff they have gone?

The widepsread monetary insanity and confusion has no limits it seems.

The real insanity is people in our own industry emphatically saying "I want regulation" and when pressed for an answer why they reply "because it's coming anyway"

The top 5 bitcoin exchanges are located outside of the United States.  You can not currently "legally" operate a virtual currency exchange in the United States with out clear regulatory guidance.  We don't need "regluation."  We need clarity.

The hope is the BitLicense will provide this regulatory clarity to allow competent, compliant virtual currency business to operate legally in the US.

By the way you don't need a petition to communicate with the New York Regulators.  Commissioner Lawsky spoke at a conference on Tuesday and has invited public comment even saying he gets a lot of feedback from twitter.

@BenLawsky
@NYDFS

Here are his remarks from that event:
http://www.dfs.ny.gov/about/speeches_testimony/sp140212.htm

He is the video that includes answers to questions:
http://youtu.be/zhIZd9b2-Qs

The whole conference is here

http://newamerica.net/events/2014/new_coin_of_the_realm

[BruceFenton]

The hope is the BitLicense will provide this regulatory clarity to allow competent, compliant virtual currency business to operate legally in the US.

By the way you don't need a petition to communicate with the New York Regulators.  Commissioner Lawsky spoke at a conference on Tuesday and has invited public comment even saying he gets a lot of feedback from twitter.

Hopefully.

I've requested a meeting with him so hopefully he will accept.   If not then a detailed letter signed by a couple hundred people may at least be read.

Twitter is okay but not exactly the level of engagement I'd prefer to discuss something so important and complex.

I think the hearings were lacking in the representation of those who speak about the drawbacks of regulation.


I know one goal might be to have compliant and competent firms operate in the US but the effect could be that it drives away competition and the only operators end up being those who can deal with a mountain of regulations.

[BCB]

The hope is the BitLicense will provide this regulatory clarity to allow competent, compliant virtual currency business to operate legally in the US.

By the way you don't need a petition to communicate with the New York Regulators.  Commissioner Lawsky spoke at a conference on Tuesday and has invited public comment even saying he gets a lot of feedback from twitter.

Hopefully.

I've requested a meeting with him so hopefully he will accept.   If not then a detailed letter signed by a couple hundred people may at least be read.

Twitter is okay but not exactly the level of engagement I'd prefer to discuss something so important and complex.

I think the hearings were lacking in the representation of those who speak about the drawbacks of regulation.


I know one goal might be to have compliant and competent firms operate in the US but the effect could be that it drives away competition and the only operators end up being those who can deal with a mountain of regulations.

Bruce,

Competition is already being driven out of the US because of the lack of regulatory clairity.  See China, Panama, Singapore, Canada etc.   The US has 44 years of consistently updated laws and regulation regarding anti-money laundering and Knowing Your Customer so there is no way a pseudonymous currency will be allow to thrived unchecked. 

The US States regulate financial institutions for  safety and soundness and consumer protection.  Look at MyBitcoin.com,  Bitcoinica.com,  BitcoinSavings and Trust, GLBSE, inputs.io.  The short history of bitcoin is littered with massive fraud and operator incompetence.  There is no way a $8B + USD economy is going to go unregulated.

The conversation is not NO regulation.  The conversation has to be about prudent regulation.  And Lawsky has shown in his public statements and these hearings that he wants input from the community to keep illicit activity out of the us financial system and to protect consumers from fraud and incompetence while creating a framework that will allow this new technology to thrive in the New York.

 

[BCB]

If you lost money in "MyBitcoin.com,  Bitcoinica.com,  BitcoinSavings and Trust, GLBSE, inputs.io" it was your own fault for taking risks with your coins.

I agree 100% and if you were up on this topic you would know that part of Lawsky's regulation will probably included requirements that Bitcoin businesses inform consumers that Bitcoin is highly speculative and highly volatile.  That is great consumer protection.  You can do want you want with your money.  We are just warning you that you should understand that you are putting your money at risk.

[BCB]

Please take 30 minutes to view this video.

http://www.youtube.com/watch?v=zhIZd9b2-Qs

Published on Feb 12, 2014
Cryptocurrencies: The New Coin of the Realm?
The State of Play

In 2009, the mysterious and pseudonymous Satoshi Nakamoto launched Bitcoin, the world's first online cryptocurrency. Backed by no government or hard assets, the currency's value has skyrocketed and plunged repeatedly. And yet, a diverse group of entrepreneurs, businesses and would-be money launders has followed Bitcoin's trajectory avidly. The receptivity indicates a real demand for an Internet-centric medium of exchange, without banks and without fees. Yet the rise of "criminal eBays" like the Silk Road, which allow for the anonymous purchase of illegal items with the cryptocurrency, have also brought the digital cash to the attention of government authorities. Beyond monitoring illicit activity, should regulators have a role in this new financial system? Could Bitcoin-or another cryptocurrency-become a universal alternative currency? Will we ever be able to use a cryptocurrency at our local bodega?

Benjamin M. Lawsky
Superintendent of Financial Services, New York State Department of Financial Services
@BenLawsky