First of all, thanks to Ken for all the hard work. He has to deal with share management and PR on top of all his normal duties. I know his efforts to be available to anyone who asks for his time and respond to threads here are with good intentions, but this is the kind of thing that hurts us in the PR department. (see below in
red)
A better response would have been something like...,
ActiveMining wants to do everything it can to be compliant and legal. To that end, our lawyers are reviewing bla bla bla...I'm looking forward to getting a board in place that can speak on ActM's behalf in a way that instills confidence in investors and satisfies the questions from skeptics.
Meanwhile, I have sent Ken a suggestion for legal council experienced in Bitcoin and currently running the regulation committee for the Bitcoin Foundation. I hope that between his existing legal council and this one, ActM will be able to take a confident position on the SEC development and lead the Bitcoin security sector in efforts to align its operations and policies with those of a non-bitcoin security.
I've been reading up several documents on the SEC site. Here's the key wording I've found:
http://www.sec.gov/investor/alerts/ia_virtualcurrencies.pdfAny investment in securities in
the United states remains subject to the jurisdiction
of the seC regardless of whether the investment is made
in U.s. dollars or a virtual currency. In particular,
individuals selling investments are typically subject
to federal or state licensing requirements
I've read over a lot of other material as well but I think (IANAL):
- If the exchange is in the US, it needs to comply with SEC regulation.
- If an offering is from a US company, it needs to be registered with the SEC or follow the Exception rules.
- There are no rules preventing US citizens from buying assets, shares, or anything similar from foreign exchanges
- BTCT and Bitfunder are on weak legal ground by trying to claim they aren't real investments. The core issue is that they pay dividends, i.e. real money based on buying a virtual asset of some kind. A crytpocurrency is real money as far as this is concerned. If they aren't selling securities of some kind, they're gambling. It's one or the other, and gambling is far more restrictive.
- As long as these exchanges are not based in the US, they only need to comply with the rules in the country of registration. These rules are likely to be less stringent than in the US but that doesn't mean they don't exist. A legal opinion is needed for e.g. operating out of Belize.
- As above, selling virtual assets in a company registered another country, such as Belize, may similarly need some form of local registration. A legal opinion is needed.
I could be wrong on any or all of the above. Please can a lawyer turn up
Edit: I'm sure those behind the exchanges have had a legal opinion, but we've seen this all go wrong before. Also, those selling 'investments' need to be aware too. Those based in Belize et al are probably fine. Those based in the US are definitely breaking the law unless already registered with the SEC.
Edit2: Ukyo says on IRC that Bitfunder is registered in a 3rd world country that has no securities division.
LMAO. You, and all the operations of AMC are in the United States. Registering in Belize is going to slow down the SEC like a toilet paper wall stops a bulldozer.
