Is US Regulation the Single Biggest Threat to Bitcoin?

  • March 4, 2013 · 7:00 PM
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If you are a Bitcoin ecosystem participant (user, entrepreneur), you may be aware that there is a myriad of rules and regulations, at the federal, state and even international level, that may apply to you.  Why?  Because Bitcoin is technically a “value transfer” system, and such systems are heavily regulated to protect consumer rights and deter financial crime, including the financing of terrorism.  Join us for a lively discussion of potential obstacles to the growth of the Bitcoin ecosystem.

Juan Llanos gives us his perspective on regulation and the technical nuances of Bitcoin.

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  • Juan Llanos

    I may want to read...

    PART ONE: http://contrariancompliance.com...­

    PART TWO: http://contrariancompliance.com...­

    June 24, 2013

  • Juan Llanos

    It's happening, guys! http://contrariancompliance.com...­

    June 2, 2013

  • Juan Llanos

    May 12, 2013

  • Juan Llanos

    This is all I've been trying to say all along: There IS a big precedent that could hurt Bitcoiners and innovation: http://contrariancompliance.com...­ I did my homework for this one...

    May 12, 2013

  • Juan Llanos

    Crystal Clarity on Foreign Money Transmitters (and Bitcoiners) in the Republic of Texas: http://contrariancompliance.com...­

    May 9, 2013

  • Juan Llanos

    Yet another threat...

    "Here's what I know for sure: we could regulate it if we wanted. That is very clear," Chilton [Commodity Futures Trading Commission] told Reuters in an interview on Monday. The Financial Times was first to report on Chilton's plans.

    http://www.reuters.com/article/...­

    May 7, 2013

  • Juan Llanos

    Interesting sound bite with the Bitcoin Foundation's (BF) general counsel, whose paid job is being Coinlab's general counsel. In a nutshell: (a) the BF seems to have been trying to lobby against the FinCEN March guidance; (b) the BF is clearly disappointed that FinCEN chose to label exchangers and administrators as "money transmitters" (heavier compliance burden), instead of "prepaid access" (lighter compliance burden).

    http://www.acfcs.org/wp-content...­ (duration: 20 minutes)

    May 1, 2013

  • Juan Llanos

    Hi, Paul. The only states in the US that currently do not require licensing are New Mexico, Montana and South Carolina.

    Please mind that, of the states requiring licensing, some use the "physical presence" test, and others the "customer residency test." In the first one, you must apply for a license if you as a company are physically located on the state. In the second one (applied by New York and Texas, for example), you must be licensed in the state when your consumer is from that state, regardless of your physical presence (domestic or international). Hope this helps.

    April 22, 2013

  • Juan Llanos

    More Bitcoin dealers' accounts getting "defensively" closed. This time in Canada: http://www.ctvnews.ca/business/...­

    April 29, 2013

    • pat xcubicle

      seems like a risky move for businesses that take bitcoin as payment if they are going to close out your bank account. that might be their next move to scare the public.

      April 29, 2013

  • Paul Sproge

    Does anyone know where I can get Juan's PowerPoint from this meetup? I'm looking for some information he went over that I forgot to write down...

    Dealing with the few states that don't require licensing or have regulation... Georgia (or was it SC?), Montana, etc..

    Thank you! It was a great presentation!

    April 22, 2013

  • Bailey Reutzel

    Have a looksy poo all... About the Bitfloor closing-http://www.paymentssource.com/n...­

    4 · April 19, 2013

  • Juan Llanos

    Yet another wrinkle: http://www.nextgov.com/emerging...­

    April 19, 2013

  • Juan Llanos

    By the way, what happened to Bitfloor today has been happening to us Money Services Businesses (some, rather) for the past 20 years: Banks close our accounts out of fear that their reputation might be damaged if something goes wrong, thus forcing some of us out of business (MSBs DO need bank accounts!). The reason is generally that they find their MSB clients' regulatory and AML risk management programs inadequate. But more often than not, it's just out of fear in spite of an MSB having a sound, fully-compliant program. Not sure what the reason was for Bitfloor, really, but it may have been either. Gird your loins for more. This is just the beginning.

    1 · April 18, 2013

    • Jerry CC

      Shamoon, yes banks do regularly close accounts for any reason or no reason whatsoever. They are a private business and can choose who they serve. Many legal industries have problems with banking services, pornography, medical marijuana, importers. Any business that a bank sees as bringing undue heat from the authorities will be first targeted for high fees, and then when those high fees still don't justify the business relationship, the bank will close the account. It's ironic that Bitfloor is being shut down for the exact reason why we need bitcoins, decentralized access to financial services.

      1 · April 19, 2013

    • Juan Llanos

      Of course! They do it all the time. We (Unidos) have dozens of regional bank accounts because the big banks refuse to bank us, which causes our back office ops to be extremely complex and inefficient. Read this link, especially Charles Rangel's letter, and you'll understand: http://nmta.us/site/p...­

      April 19, 2013

  • Juan Llanos

    Here's the stay-out-of-trouble checklist, in case it's not yet clear to Bitcoiners: http://contrariancompliance.com...­

    2 · April 18, 2013

  • Juan Llanos

    Does this help the Bitcoin case? Mmmm. http://www.guardian.co.uk/techn...­

    April 9, 2013

  • Javier

    Hi, many of you might know that last week was very bad in Argentina, specially in Buenos Aires and La Plata due to record floods: http://www.nytimes.com/2013/04/...­

    There is a group there which is collecting Bitcoins for the affected people. The official communication in English says: Eudemocracia (http://eudemocracia.org­) and Eudemocracia's Bitcoin community ([masked]) are collecting Bitcoin donations to help people affected by April 2013 flood in Buenos Aires. Donations are accepted at 1MJ2hZWZ4RbvfekWGyFEAczErpTXxYvCmM­. To verify account status check it at https://blockchain.info/address/...­. Check or update the donors list at http://wiki.eudemocracia.org/do...­.


    The bitcoins will be sold for Argentinian pesos among the group members and the money will be used to buy food, clothes, shoes, mattresses, blankets, etc.

    Thank you for your help!

    April 7, 2013

  • Juan Llanos

    Another quote from another post: "As Bitcoin gets closer to the U.S. regulatory umbrella, it moves closer to legitimacy. These rules and the ones that will follow will increase the overhead costs of all players in the space, but that is a small price to pay for legitimacy." http://techcrunch.com/2013/04/0...­

    April 7, 2013

  • Juan Llanos

    From the post below: "The FBI is on the record as saying that “it is a violation of federal law for individuals… to create private coin or currency systems to compete with the official coinage and currency of the United States”. And laws against operating an unlicensed money-transmitting business have been used against electronic currencies in the past, and would seem to apply equally to bitcoin."

    April 4, 2013

  • Juan Llanos

    A lot of food for thought in this great post: https://medium.com/money-banking...­

    April 4, 2013

  • Juan Llanos

    BREAKING NEWS! Fresh out of the federal oven, clarification as to who is and who is not an MSB (money services business)!

    FinCEN Issues Guidance on Virtual Currencies and Regulatory Responsibilities

    To provide clarity and regulatory certainty for businesses and individuals engaged in an expanding field of financial activity, the Financial Crimes Enforcement Network (FinCEN) today issued the following guidance: Application of FinCEN’s Regulations to Persons Administering, Exchanging, or Using Virtual Currencies. Guidance: http://www.fincen.gov/statutes_...­

    1 · March 18, 2013

    • Bailey Reutzel

      Here you are everyone! Enjoy... I welcome feedback. :) http://bit.ly/16Ho3qU­

      1 · March 19, 2013

    • Juan Llanos

      And now the Wall Shttp://online.wsj.com...­ Journal...

      March 23, 2013

  • Malcolm Arnold

    Is anyone going to tape this? it is looking like I won't be able to attend. I will adjust my RSVP tomorrow by noon if that is the case. Thanks in advance to anyone taping/posting it and to the organizers/presenter.

    March 3, 2013

    • Malcolm Arnold

      Hello Pat, were you or anyone else able to tape it? thx

      March 6, 2013

    • pat xcubicle

      yea its just gonna take some time to upload it.. its 3GB worth of video... will post it when its up and when juan screens it first.

      March 6, 2013

  • A former member
    A former member

    I really appreciated the talk, although it was bit hard to follow in some parts. I think most of that had to do with my physical discomfort sitting in the high chair.

    March 6, 2013

  • Juan Llanos

    Thanks, everyone, for their feedback. And, above all, for your patience and respect last night. I agree with Marc that it's a very smart group. Happy to be part of it, and appreciative of the opportunity to share my perspective with all!

    1 · March 5, 2013

  • Carlos Sanchez

    I'm really looking forward to the next one and some networking. Hopefully it will happen sooner than later.

    1 · March 5, 2013

  • Tod Gillespie

    A bit more time for open engagement would have been great. Otherwise very interesting, even if a bit off-topic.

    1 · March 5, 2013

  • Marc Principato

    Great meetup. Great information presenter and a group of very smart people. I am happy I went and will continue to attend these.

    March 5, 2013

  • Owen Gunden

    speaker was a bit long and a fair amount of what he said was irrelevant. that said, I did learn a few things and I'm glad someone is doing bitcoin-related meetups!

    March 4, 2013

    • Carlos Sanchez

      Agreed, presenter did a great job I appreciate his time but It was a bit long. I dig get some ideas but i was hoping for more networking time.

      March 5, 2013

  • Jerry CC

    Thanks to Juan for sharing his perspective and experience on the US regulatory environment as it pertains to financial businesses.

    March 4, 2013

  • Zephyr R

    Hope you just make a video of Juan Llanos's take and host int on youtube or vimeo.

    March 3, 2013

  • Marc H

    Looking forward to it. Bitcoin has come a long way since first meetup last summer

    February 28, 2013

  • Bailey Reutzel

    I'm going to be bringing my boyfriend to this next event... He's a newb but would love to listen.

    February 25, 2013

  • pat xcubicle

    is anyone interested in holding a newbie meetup session aswell? i might hold one on the following day if anyone is interested. its for those that are still new to bitcoin and want to understand how it works as i am still learning myself.

    1 · February 25, 2013

  • Javier

    Newbie

    February 23, 2013

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