Liberty Reserve Shutdown

Julia Dixon on May 27, 2013

liberty-reserve-logoThursday last week Liberty Reserve went offline. On Friday Arthur Budovsky Belanchuk, the owner, was arrested in Spain after a joint money laundering investigation by US and Costa Rican authorities. The allegations are that Liberty Reserve was financed using money from child pornography websites and drug trafficking.

The Tico Times, an English newspaper in Costa Rica, is reporting that Budovsky has been under investigation since 2011 after a request from a prosecutor’s office in New York.  Liberty Reserve is a Costa Rican business and Budovsky is a Costa Rican citizen of Ukrainian origin.

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FinCEN Issues “Guidance on Virtual Currencies”

Julia Dixon on March 19, 2013

fincen.header-editThis guidance was issued to “provide clarity and regulatory certainty for businesses and individuals engaged in an expanding field of financial activity.” Or put another way, FinCEN explains who exactly they intend to regulate.

FinCEN covers their bases here discussing “users, administrators, and exchangers… persons creating, obtaining, distributing, exchanging, accepting or transmitting” virtual currencies, both centralized and de-centralized, e-currencies and e-precious metals.

  • FinCEN sees those dealing in virtual currencies as their regulatory responsibility
  • Users, and Bitcoin miners seem to be exempt from regulation for the moment
  • Buying or selling virtual currencies for “any reason” can make you a money transmitter and subject to FinCEN regulation
  • Virtual currency dealers are NOT necessarily foreign exchange dealers
  • FinCEN rules can also apply to those dealing in e-precious metals
  • However, Prepaid Access rules do NOT apply to virtual currencies

Summary below.

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The new Ripple, a decentralized exchange, a payment system, and a currency all its own

Julia Dixon on February 5, 2013

RippleOut very soon, the new version of Ripple has has undergone a dramatic renovation.

Ripple was created by Ryan Fugger in 2006 as a trust network where people can grant each other credit, and anyone can ‘be their own bank’. The project has since been acquired by a team of developers including Mt. Gox creator Jed McCaleb. Ryan’s trust network is still there, but it is now one feature of a much expanded system.

The new features of the soon to be open source software include the possibility for a decentralized currency exchange, a p2p transaction network, “Gateways” for bringing other currencies into the system, and Ripples (XRP), a new digital currency.

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“Powered by Monetas”

Julia Dixon on December 10, 2012

Monetas is building software for a decentralized financial and legal system that is less dependent on traditional bankers and lawyers.

The business’ founders, Chris Odom (Fellow Traveler) and Johann Gevers aim to make this ‘financial system 2.0’ possible by developing commercial versions of the Open Transactions digital finance library. This software will allow digital finance entrepreneurs to startup micropayment services, financial markets, community currencies, escrow services, and many others all without depending on the traditional banking or legal system.

Johann, Monetas’ CEO, recently shared with me his thoughts on finance, his belief in decentralized systems and his plans for Monetas.

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Voucher-Safe, a Next Generation Digital Currency – Part I

Julia Dixon on November 20, 2012

Digital Gold Currency is a fantastic idea. Gold enjoys thousands of years of history as an excellent currency and store of value. It is a form of money that is constantly chosen by the market and that needs no legislation to support its value. Gold is stable, solid and cannot be pulled out of thin air. With modern technology gold can be used as a currency online without any more effort than it takes to check your email. Brilliant!

But as DGC’s were starting to take off and be recognized for their many benefits, the rug was pulled out from under the industry with the prosecution of e-gold. The old DGC business model is centralized and vulnerable to seizure, censorship and prohibitive regulation.

The Voucher-Safe system allows for a more decentralized, Anti-Money Laundering compliant way to anonymously exchange value. It’s DGC 2.0, a more flexible and resilient system where anything can be money. “The idea behind voucher-safe is that it isn’t about making just one thing money. Money  can be gold, it can be existing national fiat currencies, it can be bitcoins, it can be silver, it can be anything of value that people want to exchange.”

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