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Author Topic: Exchange Methods  (Read 13951 times)
dwdollar
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March 20, 2010, 01:33:19 AM
 #1

Hi everyone.  I'd like to see a good discussion on different methods for transferring into and out of cash.  It has been touched on elsewhere, but I'd like to create a definitive thread for it.  This discussion should include, but shouldn't be limited to the following...

1.)  Methods mentioned previously on the forum, along with their pros and cons.
2.)  New ideas including ones that are "outside of the box"
3.)  As a customer, which method do you prefer?  What is more important to you?  Anonymity, security, convenience or other?

NewLibertyStandard is using direct transactions with Paypal.
I think Sirius-m is working on several different direct transactions that the customer may select from.
I am using a deposit and withdraw system using Paypal (for the time being).


Let's dicuss everything from satoshi's sophisticated "e-bay-like" idea, to madhatter2's "money in the mail" idea, and everything in between.

When there's enough scale, maybe there can be an exchange site that doesn't do transfers, just matches up buyers and sellers to exchange with each other directly, similar to how e-bay works.

To make it safer, the exchange site could act as an escrow for the bitcoin side of the payment.  The seller puts the bitcoin payment in escrow, and the buyer sends the conventional payment directly to the seller.  The exchange service doesn't handle any real world money.

This would be a step better than e-bay.  E-bay manages to work fine even though shipped goods can't be recovered if payment falls through.

Nice! Wink

I might do 'well hidden cash in the mail' here for small amounts.



One last thing.  Legality can be listed as a pro/con but let's not get wrapped up in it here.  NewLibertyStandard already has a good thread started on that topic.
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The Madhatter
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March 20, 2010, 03:10:43 AM
 #2

Cash in the mail is the best option, in my opinion.

1. It is fairly anonymous (there would be a postmark from your side and you'd know my address).
2. I know the laws inside and out here. I wouldn't violate them.
3. I am not in the USA.

Wink


Oh and PayPal is a horrible choice.

All it would take is for a competitor to rat you out to PayPal and you'd be out of business.

Exchanging in and out of physical gold/silver is another option. I have experience with shipping goods, and a friend of mine is a bullion dealer. Tongue

edit by Xunie: merged two posts.
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March 20, 2010, 03:50:46 AM
 #3

PayPal
Free and easy to open an account.
Very inexpensive to deposit, transfer and withdraw money.
Easily accessible by people all around the world.
PayPal is known to frequently freeze funds for long periods of time.
Reveals first and last name.
Transactions can be contested fairly easily.

Bank Wire
Most well established electronic money transfer method.
Fees are prohibitively expensive for small transactions.
Bank can request to reverse transaction, but it's very rare.
I presume first and last name don't need to be revealed.
Some personal account information must be revealed.

Bank Wire through MutoNovo
Fee in addition to wire fee.
Do not need to reveal personal account information to send or receive wire.

Western Union
Many locations worldwide.
Neither party needs a bank account.
Fees are fairly expensive.
Weak identity verification.

Pecunix Digital Gold Currency
Transaction fee is small.
Transactions are fairly anonymous.
Currency must be purchased and sold through a third party, presumably with expensive fees.

Postal Mail
Lots of domestic mailing options available within USA.
Mailing of currency generally discouraged.
Various types of checks can only be cashed in certain countries.
Cash can be lost or stolen.
Value of some kinds of checks can be lost or stolen.
Value of other kinds of checks do not get withdrawn until named recipient cashes check.
Although extremely unlikely and highly punishable, postal mail can be used as a delivery method for harmful biological agents.

PayPal works best for me because it's inexpensive and easy. If I was planning on expanding and making a profit from my exchange service, I would probably get an account at a big bank and offer as many payment options as possible.

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March 20, 2010, 03:58:23 AM
 #4

Not anymore. They were just recently slapped with fines. They are tightening up ID requirements now.

Western Union
Weak identity verification.
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March 20, 2010, 10:21:01 AM
 #5

I like Liberty Reserve https://www.libertyreserve.com/

Its easy to use, fast, secure and has a good API. It's been around since 2002. USD, EUR and Gold holdings. No formal ID verification process is required. You are allowed to create multiple accounts as long as you register your details fully (i.e. no fake accounts) Its based in Costa Rica, which makes the list of the 'Worlds 22 Oldest Democracies' http://wikipedia.org/wiki/Costa_Rica - Intel has a main micro processor facility in Costa Rica and I like coffee. Grin I trust and use Liberty Reserve more than any another eCurrency or online payment system. https://www.libertyreserve.com/en/exchangers/index.aspx has loads of useful exchange links.

Here are some other suggestions for discussion:

Exchange Zone - http://exchangezone.com/ - easy and secure, member to member, eCurrency auction service.

AlertPay - https://www.alertpay.com/

c-gold - https://c-gold.com/

Strict Pay - https://www.strictpay.com/

SolidTrust Pay - https://solidtrustpay.com/

Perfect Money - https://perfectmoney.com/

Global Digital Pay - https://www.globaldigitalpay.com/

ePassport - https://www.epassporte.com/

EuroGoldCash - https://www.eurogoldcash.com/

Hyper Wallet - http://www.hyperwallet.com/

Web Money - http://www.wmtransfer.com/

Pro Currex - https://www.procurrex.com/

ECU Money - http://www.ecumoney.com/


With many of these e-currencies and providers / exchangers now implementing mobile phone payments it would seem logical to pursue that route. Most countries have 'pay-as-you-go' providers. This is as good as 'anonymous' if bought for cash. Apparently, mobile phone payments have a much higher conversion rate than credit cards etc. for online payments.

Here are some services I found for discussion and which I might be implementing myself in the future:

Zong - http://www.zong.com/zong/

Obo Pay - https://www.obopay.com/

Bango - http://bango.com/

MobileTransactions - http://www.mobiletransaction.org/

Self Bank Mobile - https://www.selfbankmobile.com/

Implementation:

Fortumo - http://fortumo.co.uk/

Asterisk - http://www.asterisk.org/

Consider the above with a Bitcoin mobile App. and we are really getting somewhere.


I don't agree with the land mail method. Its comparatively slow and less anonymous than you might think - Just remember to handle the envelope and its contents, lick the seal and stamp and send it from your local mail box...

This reminds me of a few Google Hoaxes.

Gmail Paper - http://mail.google.com/mail/help/paper/index.html

Google Gulp - http://www.google.com/googlegulp/ lol Cheesy

I was a very early Bitcoin adopter - I mined and sold over 12,500+ BTC before they reached just a few cents! I bought a slice of a rather famous Pizza!? and donated 500 BTC to the first Bitcoin Faucet. Got a bit lost along the way... logged out 2010... logged back in 2013... I did 'find' around 25 BTC (in old wallets and sites), which is better than none! <> BBR - CBX - CURE - DASHEMCGAP - GRC - LTC - MINT - NMC - NuBits - PPC - SLM - START - XPM - <> This is not investment advice! <>
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March 20, 2010, 07:28:36 PM
 #6

As a business, why would I accept Bitcoin and not LR/Pecunix? It doesn't make any sense to do exchanges between LR/Pecunix and Bitcoin.


Oh, and asterisk sucks. You'll want freeswitch instead. (freeswitch.org)


So you are saying that people are lazy? lol Big surprise there. Tongue

I don't agree with the land mail method. Its comparatively slow and less anonymous than you might think - Just remember to handle the envelope and its contents, lick the seal and stamp and send it from your local mail box...


Oh and LR is a fractional reserve currency on top of a fractional reserve currency. Do not keep money in your LR accounts. Use it as a pass-thru only. Also, PerfectMoney is ran by a sociopath who is currently in prison.

edit by Xunie: merged 4 posts.
BitcoinFX
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March 20, 2010, 10:25:47 PM
 #7

As a business, why would I accept Bitcoin and not LR/Pecunix? It doesn't make any sense to do exchanges between LR/Pecunix and Bitcoin.


You can decide to accept Bitcoins and / or LR/Pecunix, both or neither !

It does make sense to exchange LR/Pecunix with Bitcoins and vice versa;

(1) You (customers) can generate Bitcoins.

(2) You (customers) can buy, sell, or exchange items, goods and services which you can't with just Bitcoins and vice versa.

You know you can obtain a bank card to withdraw LR USD from an ATM ! You can't do that with Bitcoins, yet ! Grin

I was a very early Bitcoin adopter - I mined and sold over 12,500+ BTC before they reached just a few cents! I bought a slice of a rather famous Pizza!? and donated 500 BTC to the first Bitcoin Faucet. Got a bit lost along the way... logged out 2010... logged back in 2013... I did 'find' around 25 BTC (in old wallets and sites), which is better than none! <> BBR - CBX - CURE - DASHEMCGAP - GRC - LTC - MINT - NMC - NuBits - PPC - SLM - START - XPM - <> This is not investment advice! <>
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March 20, 2010, 10:30:26 PM
 #8

Oh, and asterisk sucks. You'll want freeswitch instead. (freeswitch.org)

Thanks for the opinion, link and info. I will look into and try that one.

We are all here to learn, discuss and share information.

I was a very early Bitcoin adopter - I mined and sold over 12,500+ BTC before they reached just a few cents! I bought a slice of a rather famous Pizza!? and donated 500 BTC to the first Bitcoin Faucet. Got a bit lost along the way... logged out 2010... logged back in 2013... I did 'find' around 25 BTC (in old wallets and sites), which is better than none! <> BBR - CBX - CURE - DASHEMCGAP - GRC - LTC - MINT - NMC - NuBits - PPC - SLM - START - XPM - <> This is not investment advice! <>
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March 20, 2010, 10:37:39 PM
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So you are saying that people are lazy? lol Big surprise there. Tongue

I don't agree with the land mail method. Its comparatively slow and less anonymous than you might think - Just remember to handle the envelope and its contents, lick the seal and stamp and send it from your local mail box...

Yes. I was also highlighting the fact that 'snail mail' is slow. Also, on a 'paranoid' note it's not 'anonymous' to send a 'franked' envelope, revealing your location and which also contains your DNA. Shocked

Not that this is a realistic consideration for micro payments anyway. Much better to buy a 'mobile' credit card and toss it in a ditch. If you are that way inclined.

I'm not saying 'snail mail' is a bad idea. Just discussing the pros and cons...

I was a very early Bitcoin adopter - I mined and sold over 12,500+ BTC before they reached just a few cents! I bought a slice of a rather famous Pizza!? and donated 500 BTC to the first Bitcoin Faucet. Got a bit lost along the way... logged out 2010... logged back in 2013... I did 'find' around 25 BTC (in old wallets and sites), which is better than none! <> BBR - CBX - CURE - DASHEMCGAP - GRC - LTC - MINT - NMC - NuBits - PPC - SLM - START - XPM - <> This is not investment advice! <>
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March 20, 2010, 10:46:23 PM
 #10

Oh and LR is a fractional reserve currency on top of a fractional reserve currency. Do not keep money in your LR accounts. Use it as a pass-thru only. Also, PerfectMoney is ran by a sociopath who is currently in prison.

Yep. Never keep money in a bank, always keep it under the bed, much safer... lol  Wink

Yes. I have also heard of 'problems' with Perfect Money.

Most of what I listed was for discussion and was not a recommendation. Again, we are here to share ideas and information, good, bad or indifferent. Smiley

I was a very early Bitcoin adopter - I mined and sold over 12,500+ BTC before they reached just a few cents! I bought a slice of a rather famous Pizza!? and donated 500 BTC to the first Bitcoin Faucet. Got a bit lost along the way... logged out 2010... logged back in 2013... I did 'find' around 25 BTC (in old wallets and sites), which is better than none! <> BBR - CBX - CURE - DASHEMCGAP - GRC - LTC - MINT - NMC - NuBits - PPC - SLM - START - XPM - <> This is not investment advice! <>
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March 20, 2010, 10:49:47 PM
 #11

Also found liqpay (mobile payments) - https://www.liqpay.com

I was a very early Bitcoin adopter - I mined and sold over 12,500+ BTC before they reached just a few cents! I bought a slice of a rather famous Pizza!? and donated 500 BTC to the first Bitcoin Faucet. Got a bit lost along the way... logged out 2010... logged back in 2013... I did 'find' around 25 BTC (in old wallets and sites), which is better than none! <> BBR - CBX - CURE - DASHEMCGAP - GRC - LTC - MINT - NMC - NuBits - PPC - SLM - START - XPM - <> This is not investment advice! <>
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March 20, 2010, 10:56:55 PM
 #12

I think as Bitcoin's adoption rates go up more and more LR+Pecunix only sites will pick up Bitcoin as an alternate payment option. After all, the people already accepting LR/Pecunix are very like-minded.

Yes, we are all here to learn and discuss. My apologies if I came across as a "know-it-all". I have just been in the payment processing industry and law studies for over 10 years, and I know a lot about it. Wink

Sure, you can be worried about me taking your DNA from an envelope that you send. Tongue Just use gloves when preparing the envelope and use water or tape instead of saliva. (Wear a hair net too if you are that paranoid! ha!)

A franked envelope has information about the general area from where the letter was mailed. It is rather useless to an investigator, assuming that you don't use a real return address. Or you use a return address that I provide you (lets just say). You can also go for a little drive to a different part of town and mail from there. Or another city. Or get a friend to re-mail it from his city. There are plenty of options.

'Snail mail' when properly prepared (making the envelopes as machine-readable as possible and using the proper Zip code 5+4 digit extension, etc) is actually quite speedy. (I have experience with shipping as well.)
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March 20, 2010, 11:03:40 PM
 #13

Epassporte is kinda scammy. It is ran by the same folks who run Paycom/Epoch Billing (adult billing). I personally know a handful of people who were ripped off, had their accounts frozen for various non-issues (see: PayPal).

When I had signed up for a physical card when they first opened I never received anything in the mail, they charged my CC, my bank called me asking me if it was fraudulent. They told me that those epassporte charges had caused a lot of disputes at my bank. I explained to the guy on the phone what I had ordered online and that I hadn't received anything. (It wasn't my intention to chargeback or cause any "friendly fraud", people do that to me all the time so I know how it feels. It is aggravating.) My money was refunded by epassporte after I called them in California (they claim to be in Antigua).

When people ask me to pay them with Epassporte, I usually just laugh.

Anyone want to hear my stories about PayPal? lol I have a few.

How about with Visa International? Or MasterCard's broken securecode system?

Tongue
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March 20, 2010, 11:06:22 PM
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Great minds think alike. (There are better places than under your bed.)

Yep. Never keep money in a bank, always keep it under the bed, much safer... lol  Wink
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March 20, 2010, 11:20:02 PM
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I think as Bitcoin's adoption rates go up more and more LR+Pecunix only sites will pick up Bitcoin as an alternate payment option. After all, the people already accepting LR/Pecunix are very like-minded.

Yes, we are all here to learn and discuss. My apologies if I came across as a "know-it-all". I have just been in the payment processing industry and law studies for over 10 years, and I know a lot about it. Wink

Sure, you can be worried about me taking your DNA from an envelope that you send. Tongue Just use gloves when preparing the envelope and use water or tape instead of saliva. (Wear a hair net too if you are that paranoid! ha!)

A franked envelope has information about the general area from where the letter was mailed. It is rather useless to an investigator, assuming that you don't use a real return address. Or you use a return address that I provide you (lets just say). You can also go for a little drive to a different part of town and mail from there. Or another city. Or get a friend to re-mail it from his city. There are plenty of options.

'Snail mail' when properly prepared (making the envelopes as machine-readable as possible and using the proper Zip code 5+4 digit extension, etc) is actually quite speedy. (I have experience with shipping as well.)


No. You don't come across as a 'know-it-all'. I enjoy reading your post and contributions.

However, I would much rather just sit at my desk and transfer 'payments' around by text msg etc. than have to drive across town to post a letter. Only to return home and remember that I'd forgotten to buy the darn hair nets (again) rofl.

Google Paper has experience of shipping to http://mail.google.com/mail/help/paper/more.html

I was a very early Bitcoin adopter - I mined and sold over 12,500+ BTC before they reached just a few cents! I bought a slice of a rather famous Pizza!? and donated 500 BTC to the first Bitcoin Faucet. Got a bit lost along the way... logged out 2010... logged back in 2013... I did 'find' around 25 BTC (in old wallets and sites), which is better than none! <> BBR - CBX - CURE - DASHEMCGAP - GRC - LTC - MINT - NMC - NuBits - PPC - SLM - START - XPM - <> This is not investment advice! <>
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March 20, 2010, 11:24:26 PM
 #16

Maybe one should have a lackey that does the driving and mailing. Tongue Pay him in Bitcoins!

However, I would much rather just sit at my desk and transfer 'payments' around by text msg etc. than have to drive across town to post a letter. Only to return home and remember that I'd forgotten to buy the darn hair nets (again) rofl.
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March 21, 2010, 09:49:31 PM
 #17

Here is an idea I have been pondering.  I think it's similar to Satoshi's, only transfers are made directly...  Feel free to rip apart or amend.  I created a goofy .pdf to explain what is happening.

In theory this could be used for any third party such as Paypal, etc.  I think it would be very difficult for them to prove that individuals are participating in a currency exchange.  And, I think it becomes more difficult to prove as the number of traders increase.

One big problem.  Person A and Person B must follow through with their transfers and be honest about their actions.  A solution might be to require an initial deposit from each individual to be held as collateral before any orders are made.  These deposits could be in Bitcoins and offered as compensation when a trade "goes bad" for whatever reason.

Pros:
1.)  No centralized account that can be seized or frozen.
2.)  No tax reporting burden on accounts.

Cons:
1.)  Transfers are less anonymous since individuals can "see" one another.
2.)  Parties must be trustworthy.
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March 22, 2010, 07:32:27 PM
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During an audit (taxman, or otherwise) how will "Person B" explain a donation? Person B would need to have some sort of cover. A fake charity or something?
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March 23, 2010, 12:59:09 AM
 #19

During an audit (taxman, or otherwise) how will "Person B" explain a donation? Person B would need to have some sort of cover. A fake charity or something?


I'm not sure what Paypal is required to report on individuals and/or merchants.  This explains some of it for US domestic.  It's a little dated though.  Maybe someone could elaborate.
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March 23, 2010, 02:00:04 AM
 #20

None of that matters. PayPal's corporate policies are not law. Under the slightest inquiry they will give you up. I guarantee that fact.

See 'jurisdiction' again. Is PayPal a registered corporation? I'd imagine so. Obtaining a corporate charter is a PRIVILEGE (means "private law"), not a right. (Rights are inherent, you don't apply for them.) It makes PayPal subject to the jurisdiction of the REGISTRAR. (The state or federal government.) So when they are asked for your information and are stuffed with a pile of statutes, they have to comply or face civil (See: Roman Civil Law) penalties or the revocation of the charter. (Revocation of charters is rare, but it does happen.)

After PayPal gives up your information; they (IRS/boogieman/whoever) will look at the real world items you have in your 'keep' and determine that they were paid for with these so-called donations online.

You'll enter your plea with the courts (a plea is a verbal contract that also establishes civil jurisdiction with your consent), they'll find you guilty, and you'll get a nice piece of paper called a court order to pay fines (or possibly jail time).

Call me jaded if you wish. They are very 'tricky monkeys'. Wink
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