The Currency That's Up 200,000 Percent

I'd wait for FINCEN's to issue a positional statement.
Otherwise you may fall into the e-gold trap.

My understanding:

Bitcoin is NOT an MSB (Money Service Business)
Bitcoin does not qualify as a legal Money Transmitter (Criteria for MSB)
Bitcoin IS a "Stored Value"
BitcoinUSA was acting legally under Know Your Customer and (some?) US Treasury Laws

While the FinCen seems to be the major governmental bureau on determining these things, it is worth mentioning some Constitutional and Federal Law:

a) 18 USC 1956, 1957
(1) (1)Whoever, knowing that the property involved in a financial transaction represents the proceeds of some form of unlawful activity, conducts or attempts to conduct such a financial transaction which in fact involves the proceeds of specified unlawful activity—
(2) (A)
(3) (i) With the intent to promote the carrying on of specified unlawful activity; or
(4) (ii) With intent to engage in conduct constituting a violation of section 7201 or 7206 of the Internal Revenue Code of 1986; or
(5) (B) Knowing that the transaction is designed in whole or in part—
(6) (i) To conceal or disguise the nature, the location, the source, the ownership, or the control of the proceeds of specified unlawful activity; or
(7) (ii) To avoid a transaction reporting requirement under State or Federal law,
8 Shall be sentenced to a fine of not more than $500,000 or twice the value of the property involved in the transaction, whichever is greater, or imprisonment for not more than twenty years, or both.
(9) For purposes of this paragraph, a financial transaction shall be considered to be one involving the proceeds of specified unlawful activity if it is part of a set of parallel or dependent transactions, any one of which involves the proceeds of specified unlawful activity, and all of which are part of a single plan or arrangement.


2. Under 18 USC 1957
(a) The Government is not required to prove the defendant knew that the financial transaction involved unlawful activity


And we all know that Liberty Gold was a great example, although very very different, of the government getting really aggressive. The US Attorney commented on the fact that it was viewed as a domestic terrorist act because it attacked the "economic stability" of the country.

Didn't FinCen close down BitcoinUSA?
 
Quote from PocketChange:

I'd wait for FINCEN's to issue a positional statement.
Otherwise you may fall into the e-gold trap.

My understanding:

Bitcoin is NOT an MSB (Money Service Business)
Bitcoin does not qualify as a legal Money Transmitter (Criteria for MSB)
Bitcoin IS a "Stored Value"
BitcoinUSA was acting legally under Know Your Customer and (some?) US Treasury Laws

While the FinCen seems to be the major governmental bureau on determining these things, it is worth mentioning some Constitutional and Federal Law:

a) 18 USC 1956, 1957
(1) (1)Whoever, knowing that the property involved in a financial transaction represents the proceeds of some form of unlawful activity, conducts or attempts to conduct such a financial transaction which in fact involves the proceeds of specified unlawful activity—
(2) (A)
(3) (i) With the intent to promote the carrying on of specified unlawful activity; or
(4) (ii) With intent to engage in conduct constituting a violation of section 7201 or 7206 of the Internal Revenue Code of 1986; or
(5) (B) Knowing that the transaction is designed in whole or in part—
(6) (i) To conceal or disguise the nature, the location, the source, the ownership, or the control of the proceeds of specified unlawful activity; or
(7) (ii) To avoid a transaction reporting requirement under State or Federal law,
8 Shall be sentenced to a fine of not more than $500,000 or twice the value of the property involved in the transaction, whichever is greater, or imprisonment for not more than twenty years, or both.
(9) For purposes of this paragraph, a financial transaction shall be considered to be one involving the proceeds of specified unlawful activity if it is part of a set of parallel or dependent transactions, any one of which involves the proceeds of specified unlawful activity, and all of which are part of a single plan or arrangement.


2. Under 18 USC 1957
(a) The Government is not required to prove the defendant knew that the financial transaction involved unlawful activity


And we all know that Liberty Gold was a great example, although very very different, of the government getting really aggressive. The US Attorney commented on the fact that it was viewed as a domestic terrorist act because it attacked the "economic stability" of the country.

Didn't FinCen close down BitcoinUSA?
More...

Reading this, the US government sounds kind of, um....

oppressive.

could i be put in jail for 20 years or fined $500,000 for transacting paper USD with a criminal without knowing they were a criminal? everyone reading this has probably participated in such a transaction.
 
Quote from Avid_Consumer:

Reading this, the US government sounds kind of, um....

oppressive.

could i be put in jail for 20 years or fined $500,000 for transacting paper USD with a criminal without knowing they were a criminal? everyone reading this has probably participated in such a transaction.
More...

It's illegal to start a currency that competes with the USD...
For obvious reasons...
And so it is in every developed country.

These types of laws above generally apply to "Financial Institutions"...
Or businesses that are Shadow Economy Financial Institutions...
Which means every web site trying to make money off BTC.

The NSA and CIA are observing BTC closely...
As is the Justice Department...
Gavin Anderson, lead designer, was forced to do a CIA presentation...
These guys think they're immune because BTC is "cool"...
Watch the price of BTC when the top guys are raided and they're PCs are seized.

Just such a rumor caused a 50% drop last weekend...
This thing is a stock operators dream...
Real, hardcore manipulators have moved in already...
And are pushing BTC up/down/up/down...
You can find the same action in the Pink Sheets.
 
There only chance is the stored value route and get some type of declaratory ruling from FINCEN's. Even this is tricky because certain states have escheatment laws requiring unclaimed balances to be forwarded to the state treasury as unclaimed property.
 
Quote from Avid_Consumer:

Reading this, the US government sounds kind of, um....

oppressive.

could i be put in jail for 20 years or fined $500,000 for transacting paper USD with a criminal without knowing they were a criminal? everyone reading this has probably participated in such a transaction.
More...
I undertand these apply a "reasonable person" principle. I.e. the transaction participant may not have known for sure the money or goods were preceeds of crime but a "reasonable person" in the circumstances would have suspected they were.

Following this rule, a shopkeeper who sells a snack and accepts stolen money doesn't commit a crime because the person who wants a snack looks like just any other person. (It is different if the shopkeeper sees the customer mugging someone outside the shop just before the purchase.) However, a buyer of stolen good is probably committing a crime because a "reasonable purson" would have serious suspicion the goods were obtained illegally in the circumstances.

In practice, "proceeds of crime" laws are aimed indeed at financial institutions that may accept money that result from illegal drug trade etc. Because banks are at constant risk of dealing with proceeds of crime, there are procedure for dealing with such suspicions. Here the banker acted lawfully if he/she complied with the procedure (which may involve reporting the transaction to an internal officer or refusing the transaction).
 
at the end of the day, i'm still planning to buy bitcoins. i hope they bottom out on terrible news.

it's a smart, timely idea, cleverly implemented. i believe it was founded in principle, not as an ingenious scam. could be wrong, but i don't think the founding holders did this to cash in.

i don't use or buy drugs, and bitcoin wasn't started for that purpose. i'm just a spec with a pedestrian nose for creativity, and USD has more than reaped its share of clever competition.

namecoin is just as interesting... essentially monetization of decentralized DNS.
 
I hope a bigger player like Amazon does it right.

AmazonCoins.

The guy who got $500,000 in BitCoins stolen, was computer-literate, had his BitCoins (BC) encrypted, and took other precautions. The BC's were still stolen. The layman getting involved here is entering a lion's den with pork chops strapped to his butt.

Most people will also need a Dwolla account to put money in the BitCoin account.

It took me a couple of hours to get MtGox username, passwords, unique ID's, Dwolla passwords (case sensitive!!), usernames, PIN numbers, more account names, and required messages, etc., etc. Half a sheet of notebook paper is filled with this crap.
 
You must log in or register to reply here.
Back
Top