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Bitcoin USA exchange – Failure to launch Today the one-month old…

Bitcoin USA exchange – Failure to launch

Today the one-month old exchange Bitcoin USA announced that due to lack of interest in their service the exchange was closing.

Our goal was to comply with [anticipated Anti Money Laundering / Know Your Customer] regulations in an attempt to make our bank more comfortable with our business model.

The regulations the exchange was expecting would apply are still being established.  The exchange stated that it had requested a ruling from the U.S. Department of the Treasury and that the information received in response leads them to believe that bitcoin is classified as a “stored value” instrument.  A separate ruling from FinCen was referenced in which the agency ruled that the service provider in that instance was acting as neither a money transmitter nor acting, using the more broad classification, as a money service business (MSB).

Bitcoin USA was the only bitcoin exchange other than Mt. Gox to directly accommodate Automated Clearing House (ACH) funding transactions, and Mt. Gox’s method requires the ACH to be initiated by the account holder — something rarely offered by consumer banking services in the U.S.

In the absence of alternatives, one method seeing wider use is to add funds to an ACH hub service such as Dwolla or PopMoney — both of which are methods accepted for payment by several traders on the Bitcoin OTC (over the counter) marketplace.

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