Well, the reports are one of the criteria requiring registration, but only if what you're doing actually meets the definition of a 'financial institution' and 'money transmitting business'.
Theoretically, if the regulations required a report for $2000, then you'd have to register for that. Are suspicious activity reports under section 5313?
Topic: Selling bitcoins for euro/dollar = currency exchange? (Read 2054 times)
FinCEN regulations do not apply to money transfers under $10,000, correct? So unless you have a big enough operation going on, you don't have to report to FinCEN.
This is what I understand from reading about FinCEN.
NegativeThis is what I understand from reading about FinCEN.
MSB/money transmitter are required to register with fincen.
All transfers over 10k have to be reported to fincen.
SAR reports can be filed for amounts as low as 2k
FinCEN regulations do not apply to money transfers under $10,000, correct? So unless you have a big enough operation going on, you don't have to report to FinCEN.
This is what I understand from reading about FinCEN.
This is what I understand from reading about FinCEN.
My apologies, you are right!
I will need to correct my original post - buying or selling good for Bitcoins is trading, which activity is not regulated.
Anything that involves a currency (either real or virtual) is regulated by the local authorities controlling those currencies.
It is important to note that there is a huge difference between the regulatory frameworks imposed by different governments to their citizens, so it will be wrong to assume that FinCen rules apply to all - it only applies to US citizens and other people who operate within the borders of US controlled territories and/or with US controlled currency.
I will need to correct my original post - buying or selling good for Bitcoins is trading, which activity is not regulated.
Anything that involves a currency (either real or virtual) is regulated by the local authorities controlling those currencies.
It is important to note that there is a huge difference between the regulatory frameworks imposed by different governments to their citizens, so it will be wrong to assume that FinCen rules apply to all - it only applies to US citizens and other people who operate within the borders of US controlled territories and/or with US controlled currency.
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.
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.
It talks about a decentralized virtual currency being covered. IE bitcoin, alt coins
This is directly related to mtgox/coinlab trying to get fincen registered as a prepaid provider. Now they are going to have to be money transmitter and money service business.
But its only if you are going between bitcoins and another currency.
normal goods and bitcoins is not covered because they said that is users.
Ive already talked with a lawyer that specialized in fincen/msb to confirm it.
This is directly related to mtgox/coinlab trying to get fincen registered as a prepaid provider. Now they are going to have to be money transmitter and money service business.
But its only if you are going between bitcoins and another currency.
normal goods and bitcoins is not covered because they said that is users.
Ive already talked with a lawyer that specialized in fincen/msb to confirm it.
Selling Bitcoins for cash is not and hopefully will never be regulated.
Selling Goods for Bitcoins or Buying Goods for Bitcoins = Normal User
Cash for Bitcoins or Bitcoins to Cash = Currency Exchange (Regulated)
As of March 18 2013 Trading of Bitcoins for USD is Money transmitting and Money Service Business According to FinCen.
Money Transmitting and Money Service Businesses are regulated in 48 of 50 States in the USA.
if your doing small amounts you don't have to worry
I'm in the process of getting my company "Legal" with this new guidance ruling from FinCen.
I think you've misinterpreted FinCen's latest note. I've read it and my interpretation is quite opposite - money transmitting applies to payments made with currency or e-currency. As Bitcoin is neither, it looks like this ruling does not apply to it.
But then again, instead of debating here, the best would be to get clarification from FinCen - what do they see Bitcoin as - e-currency or not.
Then we would not need to go in circles ad nauseum.
ok, so as it stands at present it seems the US see bitcoin sales as currency exchange and for the rest of the world it's just selling goods.
Looks like that makes the US the least interesting place to start my company.
Thanks for the replies. Probably best to choose a tax haven then?
Looks like that makes the US the least interesting place to start my company.
Thanks for the replies. Probably best to choose a tax haven then?
Selling Bitcoins for cash is not and hopefully will never be regulated.
Selling Goods for Bitcoins or Buying Goods for Bitcoins = Normal User
Cash for Bitcoins or Bitcoins to Cash = Currency Exchange (Regulated)
As of March 18 2013 Trading of Bitcoins for USD is Money transmitting and Money Service Business According to FinCen.
Money Transmitting and Money Service Businesses are regulated in 48 of 50 States in the USA.
if your doing small amounts you don't have to worry
I'm in the process of getting my company "Legal" with this new guidance ruling from FinCen.
Selling Bitcoins for cash is not and hopefully will never be regulated.
That's called trading goods.
The problem comes when you (personally, or your web-site, or your company) take people's deposits, hold them, provide assurances that if you go bust their money is going to be safe, allow trading among third parties as well as let them exchange the Bitcoins for currency.
Then you will be deemed to be providing financial services.
And that is always regulated.
Having said that, I don't mean to discourage you from starting an underground, the "Spirit of the Rebellion" exchange.
That's called trading goods.
The problem comes when you (personally, or your web-site, or your company) take people's deposits, hold them, provide assurances that if you go bust their money is going to be safe, allow trading among third parties as well as let them exchange the Bitcoins for currency.
Then you will be deemed to be providing financial services.
And that is always regulated.
Having said that, I don't mean to discourage you from starting an underground, the "Spirit of the Rebellion" exchange.
How about in any other jurisdictions? I don't think incorporating in the states is in my best interest?
Is there a jurisdiction where selling bitcoin is consider selling goods and not currency exchange? I'm probably better off selling bitcoins under such law, no? Or does no such country/jurisdiction exist?
Or is there a country where selling currency doesn't require a license?
Any info would be great. I'm having a very hard time figuring this out by searching google. :/
Is there a jurisdiction where selling bitcoin is consider selling goods and not currency exchange? I'm probably better off selling bitcoins under such law, no? Or does no such country/jurisdiction exist?
Or is there a country where selling currency doesn't require a license?
Any info would be great. I'm having a very hard time figuring this out by searching google. :/
In the USA you have to get licensed on a state level 98% of the time
Also on the federal level with FinCen.
Also on the federal level with FinCen.
I'm thinking of starting a company to sell bitcoins. What I noticed is that in alot of countries I'd be needing a license for 'currency exchange', is this correct? Or is selling bitcoins for a certain price just regular selling of goods like an online shop? I haven't figured out yet what country is easiest & cheapest to do bitcoin selling legaly(Will I be needing a license?). Someone any idea of this?
thanks
thanks
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