FinCen preparing to prosectute some Bitcoin users - page 3.

Herodes

hero member

Activity: 868

Merit: 1000

Quote from: virtuallylaw on April 25, 2013, 05:00:24 PM

I'm happy to continue making connections for anyone in the community, just drop me a line: patrick (at) bitcoinfoundation.org.

Would it be possible to make such a list public ? Or semi-public ? I'm sure that lawyers that's already been working on bitcoin-related projects have gained experience, that also others could benefit from.

Trader Steve

hero member

Activity: 836

Merit: 1007

"How do you eat an elephant? One bit at a time..."

Quote from: abbyd on April 25, 2013, 12:00:07 PM

FinCEN will be going after people to try to scare everybody. The irony is that they
may accidentally drive the bitcoin economy by unbalancing trading. If people can't safely cash
out into USD, there is more incentive to buy and sell with bitcoin - and STAY in bitcoin.

Good point.

tvbcof

legendary

Activity: 4760

Merit: 1283

Quote from: QuantPlus on April 25, 2013, 08:25:45 PM

...
Gox shuts down = BTC CRASH.
...

I have to doubt that based on historic precedent. I happened to have gotten serious enough about Bitcoin to use a typical exchange during the fortnight-ish the Mt. Gox was off-line due to their hack. It seemed to have had a remarkably small impact on the actual valuations. They were already in decline and continued in much the same trend once Mt. Gox came back.

If you are implying that Mt. Gox would lose significant BTC I highly doubt that. They have way to much experience, skill, and money not to have a robust cold storage regime. If they lose BTC it is almost completely certain to be an inside job.

QuantPlus

sr. member

Activity: 280

Merit: 250

Quote from: virtuallylaw on April 25, 2013, 05:00:24 PM

In the meantime, it behooves anyone who wants to build or operate an exchange service to discuss these issues with a lawyer. I have a broad network of attorneys (from Top 100 law firms to solo-practitioners) that have experience with these issues and understand bitcoin. I'm happy to continue making connections for anyone in the community, just drop me a line: patrick (at) bitcoinfoundation.org.

The legal arguments don't matter...
And lawyers will be lining up to TAKE YOUR MONEY while they furrow their foreheads...
Every securities lawyer will tell you straight up you can't run unregulated money exchange.

This is all about "guiding" US banks to cut ties with all things BTC...
Banks will voluntarily comply... it's such small potatoes.

The big one is shutting down Gox...
I doubt it would take more than one phone call from the Fed...
Gox must be in violation of dozens of Japanese securities regulations...
The entire operation looks like a bad SNL skit...
Look at that Funny Fat Guy sitting on a ball = Samurai Exchanger.

http://www.youtube.com/watch?v=LLjlOw3TVc8

Gox shuts down = BTC CRASH.

Linking BTC with Fiat has always been a Big Mistake...
BTC is a commodity... and should always have been linked to gold/silver.

mindtomatter

sr. member

Activity: 434

Merit: 254

Editor-in-Chief of Let's Talk Bitcoin!

Quote from: geoburke on April 25, 2013, 03:18:54 PM

My team is currently developing a meta-exchange for crypto-currencies - Crypto Street - and we're physically located in the US but we're considering overseas incorporation.

Looking for recommendations on lawyers well-versed in foreign incorporation in Caribbean or Central/South American countries with easier money transaction and banking laws.

P.M. me. Thanks.

Want to talk about the difficulties with operating in the US and why you're looking at south america as an "easier" solution? I added you on skype and would love to get your perspective as someone building one of these systems and trying to fit within the regulatory structure.

virtuallylaw

newbie

Activity: 25

Merit: 0

Predicting FinCEN or MTB prosecutions that have a connection to bitcoin is like predicting the sun will rise in the east, you're bound to be right eventually. I've been hearing these rumors for 2+ years now. It's never been a matter of if, but when. Maybe it's soon, maybe not. I know for certain that there is action bubbling up from the States and it's not all bitcoin related.

Part of the Foundation's mission is to protect bitcoin, and that's why we have taken FinCEN's guidance very seriously from the beginning. It's why I spend time interfacing with bank and financial crimes associations to educate them about bitcoin. We are ready, willing and able to work toward educating FinCEN, or if necessary to challenge FinCEN in court.

As I pointed out here: https://bitcoinfoundation.org/blog/?p=152 the guidelines are clear as mud and if FinCEN tried to rely on the guidelines for a prosecution they would very likely face an APA challenge, possibly from me.

In the meantime, it behooves anyone who wants to build or operate an exchange service to discuss these issues with a lawyer. I have a broad network of attorneys (from Top 100 law firms to solo-practitioners) that have experience with these issues and understand bitcoin. I'm happy to continue making connections for anyone in the community, just drop me a line: patrick (at) bitcoinfoundation.org.

Gabi

legendary

Activity: 1148

Merit: 1008

If you want to walk on water, get out of the boat

Satoshi created bitcoin, not miners! Miners only get paid to secure the network. They don't create anything. The mined transaction is a transaction just like every other. So miners are not "money transmitter"

bam91

member

Activity: 81

Merit: 10

The last line may apply to you as you are recieving the currency and transmitting it to the exchange. Again we need more and clear clarification more Fincen

xcsler

full member

Activity: 227

Merit: 100

Quote from: bam91 on April 24, 2013, 10:25:53 AM

Original statement from fincen:

http://fincen.gov/statutes_regs/guidance/html/FIN-2013-G001.html

Excerpt:

"A person that creates units of this convertible virtual currency and uses it to purchase real or virtual goods and services is a user of the convertible virtual currency and not subject to regulation as a money transmitter.(Self explanatory). By contrast, a person that creates units of convertible virtual currency and sells those units to another person for real currency or its equivalent is engaged in transmission to another location and is a money transmitter( This is what makes it illegal in the United States to sell bitcoin whether for cash or at the exchanges. In addition, a person is an exchanger and a money transmitter if the person accepts such de-centralized convertible virtual currency from one person and transmits it to another person as part of the acceptance and transfer of currency, funds, or other value that substitutes for currency(Applies to exchanges and may apply to individuals who offer escrow service)."

So to summarize the FinCen categories we have:

1)Users
2)Transmitters
3)Exchangers

FinCen uses the term "create" which I am translating as miners because they are the only ones that actually create bitcoins. So...

Users- Miners and I assume non-miners that use bitcoins to buy stuff.

Transmitters- Miners that sell bitcoins for real currency or its equivalent

Exchangers- People who accept bitcoins and then sell bitcoins for currency, funds, or other value that substitutes for currency

My understanding is that the FinCen rules do not apply to Users. If as a user I buy bitcoins on an exchange and sell them for cash I am not violating any laws so long as I pay the appropriate taxes.

glendall

legendary

Activity: 2156

Merit: 1018

Buzz App - Spin wheel, farm rewards

I really don't see how FinCen would be able to effectively track bitcoin purchases and sells in any way sufficient to prosecute someone if said person was doing only a minimal amount of things to make it difficult to do so.

Also don't see how they could prosecute folks who did stuff prior to any official ruling on the subject.

Could change in the future with some new laws, but currently would not see how they could charge bitcoin users, unless they had a great deal of resources into monitoring someone and tracking their BTC actions, and additionally linking these to some blackmarket venture.

geoburke

newbie

Activity: 34

Merit: 0

My team is currently developing a meta-exchange for crypto-currencies - Crypto Street - and we're physically located in the US but we're considering overseas incorporation.

Looking for recommendations on lawyers well-versed in foreign incorporation in Caribbean or Central/South American countries with easier money transaction and banking laws.

P.M. me. Thanks.

mindtomatter

sr. member

Activity: 434

Merit: 254

Editor-in-Chief of Let's Talk Bitcoin!

Quote from: abbyd on April 25, 2013, 12:00:07 PM

These guys know what they're talking about - they are not just random wingnuts.

FinCEN will be going after people to try to scare everybody. The irony is that they
may accidentally drive the bitcoin economy by unbalancing trading. If people can't safely cash
out into USD, there is more incentive to buy and sell with bitcoin - and STAY in bitcoin.

Also they will fail when trying to regulate international transactions. My guess is that
smart Americans will quickly move their cryptocoin->fiat transactions out of that country...

Yup.

The trick about predicting the future is to look at the broad motives and means of the interested parties, look at the situation through their eyes and think about what the next few logical steps are to achieve those goals with those means.

FinCEN is a big player because the US is a big player, might not be so if Congress stepped up once in a while but I don't think that's likely given the last few years - My expectation is a Bitcoin-Only economy will pop up for individuals who want to avoid the tax implications - They'll be paid in bitcoin, they'll fund their lives in bitcoin - Thanks to FinCEN Wink

I wonder if they'll pay taxes

abbyd

full member

Activity: 159

Merit: 100

These guys know what they're talking about - they are not just random wingnuts.

FinCEN will be going after people to try to scare everybody. The irony is that they
may accidentally drive the bitcoin economy by unbalancing trading. If people can't safely cash
out into USD, there is more incentive to buy and sell with bitcoin - and STAY in bitcoin.

Also they will fail when trying to regulate international transactions. My guess is that
smart Americans will quickly move their cryptocoin->fiat transactions out of that country...

Zedster

full member

Activity: 182

Merit: 100

Quote from: ?? on ??

Quote from: kjj on April 24, 2013, 09:42:44 AM

Correct thread title:

Some random guy says that he's heard from "anonymous sources" (aka other random guys), that the government is preparing to prosecute some bitcoin users

It was not some random guy, it was part of a fairly reasonable discussion about FinCEN as a whole and he compared what is happening currently to prior FinCEN actions. I think what he said has a fairly reasonable chance of happening to a small player who cannot fight. Something sparked those rule clarifications and, as he pointed out in the interview, the rules are unclear and may exceed their statutory authority.

The first time I tried to buy Bitcoin the first site I found was Bruce Wagner who had a web site that said I could go to one of the banks he used, make, what he claimed was an "anonymous cash deposit" into his account, and have Bitcoins sent me. I searched on him and decided against it. I can see FinCEN prosecuting something like this as he was using large banks (including my bank).

+1 If you go to freebanking.org and read just a little you will see this guy is not some idiot off the street. I truly don't think what he is saying hear should be taken with a grain of salt. His agenda appears to pro-BTC as he is offering to be that needed liaison between BTC and FINcen.

I definitely believe that if someone that knows what they are talking about doesn't sit down with them soon from the BTC community then they will do whatever they please. No matter what the discussion, ignoring FINcen and letting them just regulate as they think is right will not be good for BTC in anyway. It is way to easy for them now to say, it's main use is for laundering terrorist money. (They have way too much power under The Patriot Act) That is pretty much game over in the USA.

tvbcof

legendary

Activity: 4760

Merit: 1283

Quote from: mindtomatter on April 25, 2013, 08:31:24 AM

Quote from: Bitcoinpro on April 25, 2013, 06:25:39 AM

FinCen has no authority or jurisdiction over Crypto Currencies, any moves they make will be met in an International Court by the CCCB in defense of the integrity of Crypto Currencies. Contact will be made with FinCen on reguards to there future actions, anything else is just pure speculation!

Because everybody knows the US government has no reach or influence outside the borders of the US.

After roundly defeating the US in it's struggle for independence during WW-II, Japan has enjoyed an unprecedented degree of autonomy.

axus

full member

Activity: 129

Merit: 100

I really need to move my coins off of Mt.Gox! If I didn't sell at +$200, I never will Tongue

mindtomatter

sr. member

Activity: 434

Merit: 254

Editor-in-Chief of Let's Talk Bitcoin!

Quote from: Bitcoinpro on April 25, 2013, 06:25:39 AM

FinCen has no authority or jurisdiction over Crypto Currencies, any moves they make will be met in an International Court by the CCCB in defense of the integrity of Crypto Currencies. Contact will be made with FinCen on reguards to there future actions, anything else is just pure speculation!

Because everybody knows the US government has no reach or influence outside the borders of the US.

Bitcoinpro

legendary

Activity: 1358

Merit: 1000

FinCen has no authority or jurisdiction over Crypto Currencies, any moves they make will be met in an International Court by the CCCB in defense of the integrity of Crypto Currencies. Contact will be made with FinCen on reguards to there future actions, anything else is just pure speculation!

Luckybit

hero member

Activity: 714

Merit: 510

Quote from: Its About Sharing on April 24, 2013, 06:45:37 AM

FinCen - Financial Crimes Enforcement Network

Bradley Jansen of freebanking.org http://www.freebanking.org/author/jansen/ mentioned this on "Let's Talk Bitcoin"'s podcast from today. His words, not mine. A MUST LISTEN! Starting at around the 9 minute mark and roughly half the show.
Show Notes - http://feedproxy.google.com/~r/TheDailyBitcoinShow/~3/LKTs7vLbpLI/lets-talk-bitcoin-episode-001
MP3 - http://feedproxy.google.com/~r/TheDailyBitcoinShow/~5/v1uhZzA06to/89228962-mindtomatter-lets-talk-bitcoin-episode-001.mp3

I imagine the first prosecutions will clearly be for things related to drug purchases, laundering money, etc. Regardless, when this happens it will affect the largest network of bitcoin users.
He said FinCen has been the single biggest factor in stomping out currency competitors. e.g. - EGold
The Patriot Act has made them all the more powerful.

He said he heard it through the grapevine - that FinCen has prosectutions in the works for Bitcoin broadly speaking. He said FinCen put out the guidance in order to prosecute. And their guidelines were ambiguous as we all noticed. And he reiterated he knew the prosecutions were in the works BEFORE the FinCen guidance. This is something we have to prepare for as a community. I am planning on donating to Freebanking.org as a sort of insurance (and big Thankyou). Any other ideas on defending this en mass? It is better we prepare for this as FinCen is doing. I'm sure some of us have already started. We need a strong group of people, doesn't need to be large, just look at how the gun lobby just won out.

Things like "regulations" (quotes intended) can be a very very big hurdle. Luckily VC's are starting to bring money into bitcoin as well as people all over the world. But, the USA is turning into a bit of a, let's just say, strict State and we need to prepare for the worst. WE are going to have to defend ourselves.

Let's continue our Anti-Fragile nature,
IAS

You just said it. A type of insurance fund to fight prosecutions.

benjamindees

legendary

Activity: 1330

Merit: 1000

Quote from: DigitalDoom on April 25, 2013, 03:42:37 AM

Operation: Bitcoin Down" is already underway....probably has been for a while.

At least since summer of '11, but yes probably longer.

Quote

Bitcoin (and other cryptos) will ultimately lose as long as we all play their game. Not only did they write the freaking book on how to play, but they write new rules at their discretion.

+1

Quote

Working on a defense only is certain death for Bitcoin. We all need to start brainstorming offensive moves. Obviously I don't mean violence of any kind....but, the media will be their battlefield...How could we beat them to it?

Hah, I've been trying to point out the next move for a year now. The media is their battlefield. We need to remain in our own. "Fight the enemy where they aren't" -Lao Tzu

Topic: FinCen preparing to prosectute some Bitcoin users - page 3. (Read 13161 times)