It seems the latest regs apply to pool servers, online wallet servers, tipping bots, and more...
In view of recent changes in the virtual currency regulations in the United States, the final release of the Bit License requirements in New York, and clarifications of the law from the Ripple case, I believe it is necessary to re-assess the responsibilities of all altcoins under US law.
I believe regulation is good for the digital currency ecosystem, including bitcoin and altcoins, and will bring much needed legitimization of the industry. I also believe that for any digital currency to achieve longterm success, meeting these regulatory requirements is a necessity.
In recent discussions with two separate legal experts in the field, I have become aware that some of the services provided to users, by many altcoins, may bring regulatory requirements under current US law.
Under FinCEN (mirrored in the NY laws), the applicable clause requiring registration is this (see section bolded and underlined below):
"
c. De-Centralized Virtual Currencies A final type of convertible virtual currency activity involves a de-centralized convertible virtual currency (1) that has no central repository and no single administrator, and (2) that persons may obtain by their own computing or manufacturing effort.
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. 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.
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.See:
Link to complete FinCEN regulationThis section of the law, speaks to any case where a person or entity has custody (for any time period) of another person's digital currency, and seems to include:
Pool servers
Online wallet servers
Tipping bot servers
And any other service provided to users that entails the user transmitting some of his digital currency to a server owned and managed by the altcoin entity.
I am the founder of AppleByte (and am not a lawyer), but on the advice of council, we have chosen to take a proactive approach to understanding and applying any US regulatory responsibilities, deemed applicable. You can follow the steps we are taking on our
Announce Thread PostI invite all devs, investors and altcoin fans to share their opinions, and for devs to discuss what action they are or are not taking regarding these US regulations. If another dev want to speak with me personally, feel free to contact me at jmc
applebyte.me
I personally think these regulations are overreaching and hope they are revised. In the meantime we are stuck with them.