Quote from: SBC on March 25, 2013, 04:16:12 PM

Thanks! - We applied for FSA oversight (book of documentation detailing processes, extortionate legal advice which was pretty worthless frankly etc etc) - and as I mentioned above, they (the FSA) wouldn't give it to us only because Bitcoins don't yet fall within the scope of their definition of money - ergo not regulated by them. The registration fee and three months waiting did buy us an official response indicating that no oversight was currently required however, so it wasn't a complete waste of time.

Regarding the second set of regulations; we do fall under the MLR's and that number from HMRC is still pending (bureaucracy at its finest). Our entire business is compliant to the level of a 'Small Payment Institution' - that's why we ask a lot more information than some of our competitors. Again, it's not that we wanted to do - why would any business want to put potential customers through that? - but we we're not likely to be around very long if we don't.

It remains to be seen how the recent recognition of 'Virtual Currencies' in the US plays out over here - the UK (and Europe) tend to tow the 'special relationship' line, so my guess (and it is a guess) is that within the next few months 'guidance' will be issued by Brussels and consequently the FSA/other European Union countries financial regulatory authorities requiring all businesses in this sphere to become compliant. In many ways, this isn't unreasonable - I guess existing companies that currently deal in the money business but not specifically BTC look on and think "Why do I have to be regulated if they don't?" - it kind of levels the playing field a bit.

Thats a solid position the FSA are clearly stating there, which is at least something. Also concur with future compliancy. The market cap of BTC is fast approaching 1$B i think, so i guess there is a level where authorities have to implement processes that officially recognize the market. Moreover, when that day comes, is the day Bitcoin grows up.

Re: MLR. Ive seen the level of deposit on your site, and at those levels, an exchange is obviously not viable. I dont however see a problem with asking for ID etc. other than the over-head of doing so. Like i said, it works for spread betting companies, but i guess they have the correct resources. Are you able to indicate the stated max level of transaction/s, that a Small Payment Institution allows you?

Thanks again for you insight. Maybe, just maybe, it might help someone significant see a way forward.