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A Bitcoin service suspended by state of Virginia

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Re: A Bitcoin service suspended by state of Virginia

#51

Post by smkiv »

Assuming that OP was simply buying bitcoin (and nothing else...i.e. not automatically selling on an exchange on the backend or something...), then this could be a big shot to Bitcoin.

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...

Re: A Bitcoin service suspended by state of Virginia

#52

Post by TylerE »

downandout wrote: post #49
TylerE wrote: post #46

Earlier quoted context omitted.

Bullshit. Things with easily accessible, live-updated exchange rates have value. We're not talking about baseball cards here.

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.

I'm just going to invoke No True Scotsman at this point.

Re: A Bitcoin service suspended by state of Virginia

#53

Post by fianchetto »

mpyne wrote: post #37
fianchetto wrote: post #32

Earlier quoted context omitted.

Not to be harsh, but your argument is all over the place.

Well in fairness, that's the exact way the argument is usually seen deployed by those opposing state regulation of anything who eventually end up hyperventilating about jackbooted thugs forcing you to register your car at the DMV.

> who eventually end up hyperventilating about jackbooted thugs forcing you to register your car at the DMV.

It's a poor argument that can be derailed by what you think another might say.

Re: A Bitcoin service suspended by state of Virginia

#54

Post by oleganza »

mikeash wrote: post #31
downandout wrote: post #28

Earlier quoted context omitted.

Wrong. This company does not sell Bitcoins - they buy them (the state's "initial investigation" - which likely consisted of reading a complaint filed anonymously by a competitor - had this entirely wrong). They are only "transmitting money" in the same way that people who buy things from Amazon or eBay are when they buy products. By your definition, I guess I need to become a licensed MSB next time I buy a replacemen…

If I buy Euros, am I not transmitting money? There's a difference between Bitcoin and power supplies, namely that the former is money and the latter is not. The law applies to currency. 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 n…

Law may say what it wants. The reality is people trade things for things. Some other people define certain things as special and force you to comply based on their definitions. No one outside the legislative structures gives a rat's ass about those definitions. When you and me trade something for something, we don't care about someone's definitions, we only care about the value that we get in result. And your friends also don't care. Only people who have power to force you to comply use that power to play with words and mess with your mind.

Re: A Bitcoin service suspended by state of Virginia

#55

Post by mikeash »

oleganza wrote: post #54
mikeash wrote: post #31

Earlier quoted context omitted.

If I buy Euros, am I not transmitting money? There's a difference between Bitcoin and power supplies, namely that the former is money and the latter is not. The law applies to currency. 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 n…

Law may say what it wants. The reality is people trade things for things. Some other people define certain things as special and force you to comply based on their definitions. No one outside the legislative structures gives a rat's ass about those definitions. When you and me trade something for something, we don't care about someone's definitions, we only care about the value that we get in result. And your friends…

That's a fantasy. Here in reality, if you're operating a commercial enterprise, the way you operate depends greatly on what kind of item you sell. For example:

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.

Re: A Bitcoin service suspended by state of Virginia

#56

Post by mikeash »

cocojumbo123 wrote: post #44
mikeash wrote: post #27

Earlier quoted context omitted.

Alternative interpretation: governments couldn't give a rat's ass about Bitcoin, but care deeply about financial institutions (at least, those too small to purchase legislators) actually following the rules. 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 regulati…

Good point. Assuming ad absurdum that all exchanges (fiat/BTC) will be forbidden, does bartering via a 3'rd party - in this case BTC subjects to the same regulations ? 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'm not quite sure I grasp the idea of bartering via a 3rd party, but it sounds a lot like a credit card processor or similar, which are certainly regulated.

Re: A Bitcoin service suspended by state of Virginia

#57

Post by cocojumbo123 »

mikeash wrote: post #56
cocojumbo123 wrote: post #44

Earlier quoted context omitted.

Good point. Assuming ad absurdum that all exchanges (fiat/BTC) will be forbidden, does bartering via a 3'rd party - in this case BTC subjects to the same regulations ? 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'm not quite sure I grasp the idea of bartering via a 3rd party, but it sounds a lot like a credit card processor or similar, which are certainly regulated.

Our existing established currencies (USD, EUR, etc) were born out as an easier way of bartering (i.e. don't have to carry the the weight) or in form of exchangeable IOUs (I'll pay you back when I'll harvest).

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.

Re: A Bitcoin service suspended by state of Virginia

#58

Post by csense »

slg wrote: post #6

This is a pretty bad headline. First off, there should be a article in there, like "A Bitcoin service". Secondly, the service appears to have been shutdown to protect the owners/operators of the site from further legal action. They are not being forced to close. The state thinks they need a license and they think they don't. Instead of risking jail time on the possibility they don't need a license, they are taking th…

> there should be a article in there, like "A Bitcoin service"

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.")

[1] http://en.wikipedia.org/wiki/Headlinese

Re: A Bitcoin service suspended by state of Virginia

#59

Post by oleganza »

mikeash wrote: post #55
oleganza wrote: post #54

Earlier quoted context omitted.

Law may say what it wants. The reality is people trade things for things. Some other people define certain things as special and force you to comply based on their definitions. No one outside the legislative structures gives a rat's ass about those definitions. When you and me trade something for something, we don't care about someone's definitions, we only care about the value that we get in result. And your friends…

That's a fantasy. Here in reality, if you're operating a commercial enterprise, the way you operate depends greatly on what kind of item you sell. For example: 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,…

I agree there's no conspiracy against Bitcoin. I agree that in the view of particular people Bitcoin is money and they want it to be regulated according to their agenda.

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.

Re: A Bitcoin service suspended by state of Virginia

#60

Post by mikeash »

oleganza wrote: post #59
mikeash wrote: post #55

Earlier quoted context omitted.

That's a fantasy. Here in reality, if you're operating a commercial enterprise, the way you operate depends greatly on what kind of item you sell. For example: 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,…

I agree there's no conspiracy against Bitcoin. I agree that in the view of particular people Bitcoin is money and they want it to be regulated according to their agenda. 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 no…

Bitcoin is clearly money. The people who made it consider it to be, the people who use it consider it to be, and the people who want to regulate it consider it to be. This is no more made up than any other human terminology.
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