Topic: US Government Mistakes Digital Currency for Pacific Island! - page 3. (Read 2972 times)

hmmm, any node that relays tx to another node or includes tx into block becomes a money transmitter as it does this on behalf of someone else. Am I correct?

How do you come up with that?  That is not part of providing services unless it is some kind of scheme to transfer money under the guise of salaries or something.  The ruling is in the context of http://www.law.cornell.edu/cfr/text/31/1010.100 (31 CFR 1010.100) like it says in the footnotes.

Also see the ruling I got last year about mining.
http://cointext.com/fincen-issues-bitcoin-friendly-ruling-for-miners/

This might be relevant too.

https://www.cryptocoinsnews.com/sec-sends-inquiry-letters-hundreds-bitcoin-companies-unregistered-securities/

If Poloniex is involved with the BlockNET IPO somebody might want to contact the owner.  Might help save him some headache

The rulings from today will actually affect merchants in new and much broader ways. For example, in many cases, a company will no longer be allowed to pay wages in Bitcoin without registering as a money transmitter.

Where can we find the definition.  Of digital or crypto currency trading platform?

   Does this include p2p transactions if available to public? Any coin with an exchange feature considered trading platform?

  In which case vaguely would identities including known aliases be attached to this licensing?  Decentralized mamarketplaces would be by definition perhaps trading platform reasonably by vague law if it's written so..

    Please post if this legislation in detail has a link.

It is not that important.  All they did was apply their existing rules.  This was discussed in some of the early let's Talk Bitcoin episodes back in early 2013 when they interviewed the Monet Transfer Association a couple times. 

So? Information in OP has already been known since..Bitcoin was first made(2009) and has been around for decades. It's just being collectively "enforced". Lol

Nothing new.

Fallout is tough to calculate on this.  

One one hand we may need some more regulation but does this goes too far?

edit some exchanges already comply?

Basically this makes it so exchanges will not be based in the USA?  If that is the case, nice job pushing away businesses yet again.

According to these new rulings, there is the possibility that a business paying its employees in cryptocurrency (under certain circumstances) would be subject to the money transmitter requirements.

I suspect it will take a few days for the gravity of this new development to be fully appreciated and understood.

The Financial Crimes Enforcement Network (FinCEN) today issued two administrative rulings regarding digital currency. And the government has apparently decided to go with the nuclear option.

The first ruling published today relates to the application of FinCEN regulations to a virtual currency trading platform, while the second ruling discusses the application of FinCEN regulations to a virtual currency payment system.

In ruling FIN-2014-R011, FinCEN states that any and all cryptocurrency exchanges must become licensed as a money transmitter including crypto-only exchanges:

"As explained in the Guidance, a person is an exchanger and a money transmitter if the person accepts 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."

In ruling FIN-2014-R012, the agency confirms that any and all payment processors are obliged to register as money transmitters, significantly increasing the cost of entry in becoming a digital payments provider.

"As described above, the Company is an exchanger under the Guidance because it engages as a business in accepting and converting the customer’s real currency into virtual currency for transmission to the merchant. The fact that the Company uses its cache of Bitcoin to pay the merchant is not relevant to whether it fits within the definition of money transmitter."

Once labeled a money transmitter, a business wishing to continue operating must pay hundreds of thousands of dollars to become licensed in each of the 50 states. And that’s only the beginning of the regulatory costs and legal hoop jumping.

In addition, companies are required to register with FinCEN, conduct a comprehensive risk assessment of its exposure to money laundering, implement an Anti-Money Laundering Program based on such risk assessment, and comply with various record keeping, reporting and transaction monitoring obligations, in addition to meeting several other requirements.

It is interesting to note that the government classifies Bitcoin as a digital “property” for taxation purposes, but as a digital “money” for regulatory and licensing purposes.

Full Story: http://altcoinpress.com/2014/10/fincen-ruling-us-government-ramps-up-war-on-cryptocurrency/