Thanks for the reply. For some reason I was under the impression that the TOS change with Dwolla disallowed users from using as a method to exchange digital currency or something to that extent. Is that not the case?
Ya, if taken literally their terms would prohibit use that way, without prior approval From another thread:
You understand and agree that you will not engage in the following activities:
- Use the Dwolla system to operate or engage in any business regulated by FinCen, including the money service business;
- Use the Dwolla System without written consent in association with any online credit or virtual currency system;
But there haven't been any reports of anyone having their Dwolla funds frozen (yet) as a result. That's not really Dwolla's style, IMO, and they'ld probably give a reminder first if your volume got large enough that you'ld need to request approval for doing conversions to or from Bitcoin. The exchanges that do allow Dwolla deposits and withdrawals are, presumably, working with Dwolla's permission.
So it appears there's no need to worry about using Dwolla as the cash out method from a Bitcoin exchange, at least not the well-known ones, like Mt. Gox, Intersango, Camp BX, Get-Bitcoin, etc.