We're under attack

[genjix]

Synopsis:

- MTGox EUR and GBP accounts have been closed.
- Intersango GBP (our EUR account remains) were suddenly terminated overnight.
- TradeHill EUR bank account was closed.
- ExchangeBitcoins closes suddenly (might be unrelated).

Solutions:

Not having exchanges for bitcoin is a bad thing, and will destroy confidence in the currency if don't believe that you'll be able to exchange your bitcoins for fiat in the future.

Other solutions to this crisis are hard to come by. An idea is accepting cash vouchers, however to accept them is no easy task. Working with card payments is infeasible as they're reversible and VISA/MASTERCARD would never stand for supporting competing businesses.

WOT systems are nice, but they fail to scale beyond a few dozen users and are ripe to be gamed by scammers. WOT also doesn't have much liquidity as you have to be pro-active in deducing the market-rate to find appropriate orders.

This is barely worthy of being called an attack, this is just bitcoin hitting up against pre-existing banking regulations and failing to sneak under the radar of broader financial protections put in place to protect consumers, stop laundering etc. (and arguably also designed to protect existing commercial interests)
A real attack would be regulators specifically moving against bitcoin.

Someone in the EU commanded for a bunch of EUR and GBP accounts in 4 different countries to be shut-down in under a week after being open for 6+ months.

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[zby]

- MTGox EUR and GBP accounts have been closed.
- Intersango GBP (our EUR account remains) was suddenly terminated overnight.
- TradeHill EUR bank account has been closed.
- ExchangeBitcoins closes suddenly (might be unrelated).

Yeah...

What was the reason quoted?

[Swishercutter]

https://support.mtgox.com/entries/20568322-all-eur-transactions-will-be-temporarily-suspended-within-europe-with-immediate-effect#overview

[julz]

This is barely worthy of being called an attack, this is just bitcoin hitting up against pre-existing banking regulations and failing to sneak under the radar of broader financial protections put in place to protect consumers, stop laundering etc. (and arguably also designed to protect existing commercial interests)
A real attack would be regulators specifically moving against bitcoin.

[Swishercutter]

Not to mention this was known as a possibility for months...Mt.Gox told us this was a possible issue quite a bit ago.


https://bitcointalk.org/index.php?topic=41317.msg503663#msg503663

[genjix]

This is barely worthy of being called an attack, this is just bitcoin hitting up against pre-existing banking regulations and failing to sneak under the radar of broader financial protections put in place to protect consumers, stop laundering etc. (and arguably also designed to protect existing commercial interests)
A real attack would be regulators specifically moving against bitcoin.

Someone in the EU commanded for a bunch of EUR and GBP accounts in 4 different countries to be shut-down in under a week after being open for 6+ months.

[finway]

Can anybody do something to fight against this ATTACK?

[JackH]

genjix is right!

They will never openly risk a debate on Bitcoin - especially since it has the potential of getting more people sided with the currency if a debate is opened. That would actually be the worse thing they could do, as it would give bitcoin more press and make it sound like: "The bad banks/govs vs the people".

By closing down accounts and calling it money laundry and what not they silence the entire community, more panic arises and thus the press will be free to mock bitcoin once again and label it as fail.

[P4man]

This is no attack on bitcoin. This is a fairly logical and predictable consequence of operating financial service companies, which exchanges are.
The bitcoin aspect is still free as ever, the EURO part is not, it is regulated, and thats perfectly fine with me.

For those, who like me, think bitcoin should get a chance to become a currency, an actual trade facilitator, rather than a casino chip thats useless outside the casinos you call exchanges and bitcoinica, this is excellent news.  If you want bitcoins, start selling goods or services for bitcoins. If you want to get rid of your bitcoins, buy good or services with them. If you have no interest in either, then bitcoin isnt for you.

[Gabi]

genjix is right!

They will never openly risk a debate on Bitcoin - especially since it has the potential of getting more people sided with the currency if a debate is opened. That would actually be the worse thing they could do, as it would give bitcoin more press and make it sound like: "The bad banks/govs vs the people".

By closing down accounts and calling it money laundry and what not they silence the entire community, more panic arises and thus the press will be free to mock bitcoin once again and label it as fail.

Bitcoin is not a currency.

[repentance]

This is no attack on bitcoin. This is a fairly logical and predictable consequence of operating financial service companies, which exchanges are.
The bitcoin aspect is still free as ever, the EURO part is not, it is regulated, and thats perfectly fine with me.

Gotta agree here.  This has little to do with Bitcoin per se and everything to do with offering financial services without the appropriate licences.  You accept and hold user deposits or transmit funds between users and you're going to need a licence - even if you're accepting those funds so people can trade Beanie Babies.  People have been bringing this issue up for months and the response of the exchanges has tended to be that they don't need a licence because...Bitcoins.  

Once there was a ruling in respect of one exchange in Europe it was almost inevitable that other banks would make decisions about their exchange clients which are consistent with that ruling.  It's highly possible that they've been waiting for the battle to be fought in France so they didn't have to go through the process of seeking determinations themselves about the nature of the business their exchange clients are operating.  But even if they weren't especially waiting for this ruling, such determinations get quickly circulated within industries as a matter of routine and legal departments specifically look into whether those rulings are relevant to operations of their own employer.

I hope that before anyone opens any more exchanges they'll fully investigate the financial regulations they'll need to comply with and the cost of doing so.  Not all markets are going to prove viable for all players.  The cost of compliance with financial regulations may well mean that some markets aren't going to be viable for young exchanges (and all of the exchanges are young).  Exchanges need to determine that in advance instead of just opening in new markets and hoping for the best.

[memvola]

They will never openly risk a debate on Bitcoin - especially since it has the potential of getting more people sided with the currency if a debate is opened. That would actually be the worse thing they could do, as it would give bitcoin more press and make it sound like: "The bad banks/govs vs the people".

By closing down accounts and calling it money laundry and what not they silence the entire community, more panic arises and thus the press will be free to mock bitcoin once again and label it as fail.

Insightful. I will print this and hang on my wall.

This is no attack on bitcoin. This is a fairly logical and predictable consequence of operating financial service companies, which exchanges are.
The bitcoin aspect is still free as ever, the EURO part is not, it is regulated, and thats perfectly fine with me.

Well, regulations are there for them to enforce when they want to control something. You are right that this would happen for other type of financial services as well, so it doesn't need a conspiracy. I guess now, exchanges will need to partner with licensed financial services, we'll see how it plays out...

[becoin]

this issue up for months and the response of the exchanges has tended to be that they don't need a licence because...Bitcoins.

Of course. Bitcoins do not need license! I have predicted 4-5 months ago this is exactly what will happen. This is inevitable and this is good for bitcoins. Very good!

[EhVedadoOAnonimato]

What about changing to countries with less authoritarian governments? Switzerland, Cayman Islands, or even Panamá (Pecunix's there), Costa Rica (Liberty Reserve's there)?
How viable is it as an option? I imagine money transfers to such places are strictly traced, but they are not totally forbidden, are them?
I heard Panamá doesn't even have a central bank... I suppose their financial laws are less authoritarian... but I actually don't know.

[kokjo]

eazy now. this is not an attack.

[Serge]

I know it's not simple but what stops you guys to get licensed as a financial institution to be able to have other people deposit/withdraw funds from your accounts?

[worldinacoin]

The best thing that we can do is to use our bitcoins as much as possible and exchange it for fiat as little as possible.

[genjix]

I know it's not simple but what stops you guys to get licensed as a financial institution to be able to have other people deposit/withdraw funds from your accounts?

We've been trying this for months and months already. It's been our main goal from day 1.

[becoin]

I know it's not simple but what stops you guys to get licensed as a financial institution to be able to have other people deposit/withdraw funds from your accounts?

The answer is part of your question.
It is not simple and it is very expensive. In general, if you do it you make bitcoin part of the fiat world. This has to be avoided!

[finway]

I think it's time to let Banks to do Bitcoin exchange business.