A Bitcoin service suspended by state of Virginia
bitcointalk.org
bitcointalk.org
The government of Virgina is not terrified of Bitcoin. As a state, Virginia does not have the power to issue monetary currency. What Virginia cares about is that money transmitters--of any currency--which send money into or take money out of the state are subject to regulations to protect the citizens and residents of that state.
A legal suspension is a very different thing from a voluntary shutdown. One is the state's use of legal force--the other is the business choosing not to challenge a form letter before any legal proceedings have even begun. A form letter, legally speaking, is like a boxer saying he's going to destroy his opponent--before the match has even been arranged.
This company is transmitting money, Virginia requires companies that transmit money to be licensed, this company is not licensed, seems pretty straightforward to me.
One can argue about the merits of the regulation in question, but since regulations like this long predate Bitcoin, it's clearly not any sort of reaction to Bitcoin or any other virtual currency.
OTOH, if Bitcoin is not a currency, then it would not be subject to these laws--but in such case it would be unlikely for Bitcoin to ever become more than an extremely niche means of exchange.
The main reason many Bitcoin-related business are potentially covered by money transmitter (and related) rules is because of how they handle traditional currencies like US dollars in connection with their Bitcoin-related business.
Per the FinCEN guidance on virtual currencies [1], " An administrator or exchanger that [...] buys or sells convertible virtual currency for any reason is a money transmitter under FinCEN's regulations, unless a limitation to or exemption from the definition applies to the person."
So, no, the situation isn't the same in the eyes of the federal regulator, and its not really surprising that state regulators whose scope of authority is set by the federal rules view things the same way as the federal regulators.
[1] http://fincen.gov/statutes_regs/guidance/html/FIN-2013-G001....
Bitcoin advocates can't seem to make up their mind as to whether Bitcoin actually qualifies as "money". It's money right up to the point where the law starts talking about "money", then magically it's just some arbitrary good that's not actually a currency at all.
1. Hard liquor not for consumption on site: illegal to sell in Virginia, only the state can.
2. Firearms: highly regulated.
3. Food: must meet health department regulations.
4. Computer parts: fairly open, must still meet basic business licensing requirements, collect sales tax, etc.
You can talk about how things ought to be all you want, but all that matters here is how things are, and how things are appears to be that this Bitcoin operation falls under a certain category of law with which they are not compliant. The law is not written with Bitcoin in mind at all, so conspiracy theories about governments specifically targeting Bitcoin do not appear to have any basis.
What I don't agree is when people use made up definitions with straight face within a rational argument. It's not that you are wrong, it's that arguments like yours implicitly justify certain things as objective (e.g. differences between money and not-money).
In other words, Bitcoin services are being regulated not because Bitcoin is (or not) money, but because there are people with guns who want to control certain things in certain ways and use made-up definitions to justify their actions. When you use their definitions you just add up to global confusion and hide their lies.
And I'm not saying how things ought to be, I'm not suggesting what's good or bad. I'm saying that without honest clear terms we cannot easily decide for ourselves what's good or bad. Maybe it's good for someone to be controlled by people with guns. I just want to point out that there are guns and many people are afraid of them.
Things with easily accessible, live-updated exchange rates have value. We're not talking about baseball cards here.
You're right, we are literally talking about the buying and selling of random numbers. However, once again, Bitcoins have zero inherent value. There is no person or organization that has any obligation to buy or otherwise exchange them. They only have value to the extent that others will buy them.
For example: instead of "I exchange 3 bananas for 3 apples" to "I exchange 3 bananas for 3 btc which I can exchange for 3 apples".
I was just wandering if BTC could take the role that the shells used as money by our ancestors.
To add on top of that, for bartering there is no sales tax, etc.
Note that barter isn't actually exempt from taxes at all. Transactions are taxed at the market value of the barter. People generally ignore this, but they only get away with it because the transactions are tiny. If e.g. Exxon started selling oil by barter, the IRS would take its share.
Might want to ask Elizabeth Warren about that one.
"Instead of risking jail time (...)"
I see some contradiction in here. If you feel a threat of violence upon you, isn't it very definition of "being forced"?
You don't discuss with the state. You can have your input, but you are totally dependent on existing powers that allow you some freedom and some voice. That's why you have no problem arguing with private companies and having them listen to you, but everyone avoids state courts as much as possible (in majority of cases courts are used as a threat, not as a real dispute resolution mechanism).
They were told they "must" close by the state. I'm not sure how anyone can construe that as voluntary.
Do you think you pay taxes "voluntarily" also?
It's a poor argument that can be derailed by what you think another might say.
Thank you for this comment, I thought I was the only one on HN with that opinion.
Newspaper headlines have evolved own special grammar rules, designed to save space. According to Wikipedia [1], "Articles are usually omitted."
Also, it's a little ironic that this comment, nitpicking the headline's choice of articles, itself uses articles incorrectly (it should say "there should be _an_ article in there.")
Note that they're basically acting as the middle-man, not storing anything - I'm not really sure how the terms work in this situation. They seem to think it doesn't apply, maybe they're right.
It sounds like they did this voluntarily, and they go on to explain there have been no freezes, and all transactions have been completed. Probably a good choice (IANAL of course) while they mount a defense, which it sounds like they plan to do.
No, they were forced by the state.
It would be "voluntarily" if their customers did not like their affairs and they risked losing customers. And customers are never going to put a gun to your head. They just go away.
| They feel the risk of their property being
| seized and owners brought to court.
Something is voluntary only if there's no threat of force behind it.
Voluntary: acting or done without compulsion or obligation.
Unlike other recent headlines (around i.e. Mt. Gox, etc.), it seems like the question here is whether or not bitcoin constitutes "stored value" under VA law[1]. If so, this would render anyone who buys and sells bitcoin a Money Transmitter Business.
That said, I doubt FinCEN would consider Bitcoin "stored value" based on their definition [2] and recent "guidelines".
Stored value laws were created for things like prepaid cards (I believe...[3]), which were cracked down on because of their role in money laundering.
[1] http://leg1.state.va.us/cgi-bin/legp504.exe?000+cod+6.2-1900 [2] http://www.fincen.gov/financial_institutions/msb/definitions... [3] http://www.gpo.gov/fdsys/pkg/FR-2011-07-29/pdf/2011-19116.pd...
If you accept bitcoins for your dog-walking service, there doesn't seem to be any new regulation.
An eBay auction exclusively for btc? Where service wets beak with $$ only, or also/with btc micro payments? A problem?
"You don't get into positions of power of life and death over proles by being ignorant, only acting as if you are, which is genius-level sociopathy. If you REALLY try it sometime, you may just become the President of the United States, and have the power to slaughter babies in the Rose Garden in front of the world's press, and not suffer any real punishment whatsoever."
One thread: Bitcoin is the future of money
Other thread: Bitcoin is not money, so why apply money rules?
It either is or isn't.