Those who are intermediaries in the transfer of virtual currencies from one person to another person, or to another location, are money transmitters that must register with FinCEN as MSBs, unless an exception applies.
Pretty depressing really.
Liberty Reserve operated as an online money transmitter deliberately designed to avoid regulatory scrutiny and tailored its services to illicit actors looking to launder their ill gotten gains.
According to the allegations contained in a related criminal action brought by the U.S. Department of Justice, those illicit actors included criminal organizations engaged in credit card fraud, identity theft, investment fraud, computer hacking, narcotics trafficking, and most relevant for today’s purposes, child pornography.
The action taken by FinCEN was designed to protect the financial system from the risk posed by Liberty Reserve an online, virtual currency, money transfer system that was conceived and operated specifically to allow and encourage illicit use because of the anonymity it offers.
They could replace "Liberty Reserve" with "Bitcoin" and it would still be just as accurate, more so actually.
I recently heard a banker say that there is a reason that financial institutions have to obtain licenses. It is a great bestowal of trust that enables banks to be part of the U.S. financial system, to be part of the global financial system.
Yeah... "A great bestowal of trust". It has nothing to do with preventing competition. no no.
The saddest thing about this entire document is that they never mentioned that foreign companies / individuals are exempt as long as they do not deal with US.
Guess nobody is really exempt from the almighty world police of
USSA.
I would like to close with a challenge to our great innovators: extend your focus to devising creative solutions for preventing the abuse of virtual currencies by criminals, such as those who would exploit children
The "think of the children" card, honestly, it's getting kind of old.
We all stand to benefit from such innovation, and the related transparency and integrity to our financial system
Oh, the sweet sweet irony.
