Quote from: eldentyrell on November 09, 2013, 11:43:50 PM

Quote from: Dargo on November 09, 2013, 07:44:37 PM

Quote from: eldentyrell on November 09, 2013, 04:34:56 PM

Quote from: Dargo on November 08, 2013, 07:34:51 PM

Quote from: eldentyrell on November 08, 2013, 02:04:23 PM

Are you seriously saying that none of your employees have accounts on your own system?

Correct

Does not inspire confidence.

I'm not sure what you are worried about,

Mainly the eat-your-own-dogfood rule.

But if it's illegal for you to eat your own dog food, and it could harm your ability to provide such food for others, then the right thing to do is not eat your own dog food.

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But also the fact that I think it's a big gamble for you to claim that your physical presence in the US isn't a liability simply because you turn away US resident customers.

We think it's a bigger gamble to operate outside the US and serve US customers illegally, as every exchange outside the US that's serving US customers is doing right now. Are regulators really going to go after an exchange in the US that's operating with complete legal compliance, rather than an exchange abroad that's operating illegally? That's not clear at all.

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Look, the regulatory situation sucks, and everybody knows this. But if the feds want to bring the hammer on you guys, and you're operating out of the USA, I don't think it's going to matter whether you turn away US resident customers or not. Intrade tried this approach and it didn't work; they're still being harrassed by US regulators and they don't even have a physical presence here!

We're not turning away US customers simply because we think our exchange is safer if we don't serve US customers at all. Rather, we're not serving US customers in certain states until we can do so legally. We do serve US customers right now where we can do so legally, and we'll be bringing more areas of the US online soon, once we've completed the necessary regulatory compliance measures. But we do think our exchange is safe because we are being super careful not to operate anywhere illegally.

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On some level I feel your pain. I've long wanted to start a bitcoin-cleared version of Intrade (no, bitbets/betsofbitcoin/etc are not even close to being the same thing) and an exchange-settled market for hashrate futures. But as a US citizen and resident it's illegal for me to do these things for at least a dozen different reasons.

On a more meta level, this seems like an attempt for the US to have it both ways -- have vague and insurmountable regulatory obstacles yet not lose out on the growing bitcoin economy. One of the few things that pressures governments to fix situations like this is when they start getting shut out of growing markets. Kinda like how the ITAR encryption laws in the late 90's began hurting the tech industry and handing a huge advantage to other countries -- it was only then that the crazy ITAR nonsense got repealed. If your approach works (I don't think it will) then it will remove the only meaningful lever pushing the US government to clarify the situation and stop the harassment. But this paragraph is really more of a philosophical exercise I don't think it will turn out this way.

Quote from: nameface on November 09, 2013, 05:31:58 PM

I'm sure a lot of old school Bitcoiners imagine the best exchanges will probably have to be based in Nigeria, or Panama, or Timbuktu.

I think peoples' fiat balances are safer at exchanges with no physical US presence, at least until the US government gets explicit about exactly what sort of compliance procedures will make them happy. The Swiss banks could tell the IRS to go hang -- until UBS started to acquire assets in the US.

The US regulations could be clearer, but we're interpreting them *very* conservatively, and we're confident that later clarifications will not pose an issue for us. We've done a huge amount of legal research on this. Not only do we have an in-house legal counsel, but we also have an outside team of lawyers who have put a huge amount of work into this. No offense, but I trust them over you.

Also, let's not overlook the point that the US has at least issued regulatory guidance for digital currencies, and this is a green light of sorts. It's saying these currencies are perfectly legal, but they fall under regulatory control. It isn't a forgone conclusion for countries which haven't had much to say about digital currencies that they will issue friendlier regulations once they get around to it. Some might go the way of Thailand.

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I think pretending that it's safe to operate out of the US because you have no US customers you are aware of is silly and dangerous.

Don't be surprised if some DOJ unit gets a confidential informant to send you fraudulent residency documents.

As I already pointed out, our strategy is to be legally compliant everywhere we operate. It's not based on the silly notion that we'll be "OK" if we just refuse US customers. We have lots of US customers who are trading right now, and we've collected the required kinds of information from them to verify that they live in areas we can legally service. All the law requires is that we perform adequate diligence in this regard. The system doesn't have to be 100% foolproof. No AML/KYC program could be, and regulators understand this.