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Comment by woodruffw | Hacker News Reader

As a meta-note: given the volatility of the regulatory environment here, how can any company claim to be "regulation complaint" in a meaningful sense?

This seems to be blockchain stuff under the hood; is there a specific reason to believe that whatever (if any) differences present here are relevant to regulators?

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Money transmitter and payment service provider licenses have practically zero regulatory volatility. The last major regulation was PSD2 and that one essentially just mandated something that has been standard for years. There is not much potential for regulatory change for a license that grants you nothing but to be able to temporarily hold customer funds during payment processing.

The only regulations that are volatile are the ones relating to banking because for some stupid reason, regulators think it is a good idea to grant banks a kitchen sink license that lets them get away with anything, which in turn means that the regulators have started a cat and mouse game but that one is their own fault. If the kitchen sink licenses were separated so that non banking institutions could perform some of these tasks there wouldn't be so much trouble. A lot of the problems stem from the fact that banks aren't earning enough from their payment processing business and therefore to earn money off of providing basic accounts they need to go for investments with high risks to subsidize that part of the business which then jeopardize deposits and makes them vulnerable to being taken hostage and getting bailed out.

> A lot of the problems stem from the fact that banks aren't earning enough from their payment processing business

I don't buy this reasoning. If banks are making investments that are too risky, it's because they're mismanaged, and possibly under regulated, not because their hands were tied by a lack of ways to profit.

I'm particularly dubious that their scheme [1] could possibly be considered compliant in a jurisdiction which regulated or banned online gambling. The ruse of "we aren't gambling for money, we're just betting these worthless poker chips" is hardly new to the law, and I can't see how this is any different.

[1]: https://www.tilia.io/how-tilia-works

OT, but I always found it interesting that this ruse is legal IRL in Japan: https://en.wikipedia.org/wiki/Pachinko

This is by the same company that runs Second Life, which has heavily regulated in-game gambling, even citing the "Reasoned Legal Opinion" of the "Attorney General of Alaska" for why the things they allow are legal in 38 states (and D.C.)[1]

So we know for certain that it is not legal for most forms of gambling, only for games that are at least 51% skill-based.

[1] https://wiki.secondlife.com/wiki/Linden_Lab_Official:Second_...

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