I've had my account for 2 years with no problems; however, that doesn't ease me the fear that my account may be suspended and require government ID when I hit some limit.
I barely use Dwolla now. Coinbase (YC S12) has replaced it for me.
Do you not have government ID or is it because of not wanting to be attached to purchases you make / services you order or render? Not meaning any accusatory tone, just to note. I understand privacy.
Overzealous patrol of fraud activities is how payment providers survive, but it also decrease utility, which allows cryptocurrency like bitcoin a niche in all sort of areas.
I'm curious what people on HN believe the future holds for Bitcoins.
I expect the US government will step in in the not to far future and severely restrict the ability to legitimately exchange Bitcoins for dollars. I'm not passing any judgement on Bitcoins themselves, it just seems unlikely to me that people in places of power will be ok with an independent currency.
As with many groups, there are factions within the US.gov some that like BTC and some that hate it.
The FBI, law enforcement groups, and the Intelligence Community like it; BTC leaves trails and localizes evidence of guilt in some significant ways that make their job easier. They probably don't like BTC mixing services all that much, but that just means that they are at a slightly higher priority for monitoring and takedown.
The IRS on the other hand won't like a deniable currency which can't be cleanly audited if they can't correlate transaction id's to wallet holders cleanly and universally. Note that for any individual case it doesn't bother them, but the existence of a statistically significant population using a means of exchange that doesn't automatically report everything to the .gov (like your us based bank account does, read the fine print on your account docs ) is a vector for normalized tax fraud and off the books transactions, which they don't like, but not as much as they don't like cash in denominations larger than $20 bills.
Other major players in the US .gov who might have an opinion; the State Dept. worries about it's use for terrorism and hawala style money exchange, and the Treasury and Federal Reserve may regard it as a potential wildcard in their efforts to manage the economy.
Do expect some regulation of BTC, for instance efforts to require reporting of currency in and currency out; efforts to require linking BTC addresses to PII ( o hai coinbase.com ); and so forth.
Certain services are riskier than others. For instance I wouldn't recommend running a BTC mixer/anonymizer unless you are the wealthy and well-connected nephew of the president of a country with a UN seat; or live and operate somewhere past the horizon of US jurisdiction. At a minimum you would be labeled as providing material support for terrorism, at the utmost, you would be a prime target for subversion ( pro-tip, if your favorite mixer has an unexplained three-day outage and the CEO is not seen on video explaining in detail which storm took out which datacenter... your anonymity is no longer assured and you shouldn't use it for naughty things... )
Unfortunately, anonymous remixing is one of the few ways that BTC-only bank can hope to earn a return, so that will be one of the major tensions of the BTC economy for a few years.
Sorry, I sometimes make assumptions that many if not most of the people here have had at least some exposure to the language used in data security policies.
sorry, i probably shouldn't have replied. difficult to know whether the context is "quickly help me understand what this means" or "give me a precise answer", but for the web, with a technical audience, i should lean more towards the latter...
As long as you can exchange bitcoins for drugs delivered to your front door in first-class packages, it will be fairly trivial to exchange bitcoins for cash if you really need to. Legalization of all narcotics would hurt bitcoin far more than anything else the government could manage.
As far as I see it, it is not really a currency but rather a tool. A tool that remains operational so long as it has any "value" at all.
"As long as you can exchange bitcoins for drugs delivered to your front door in first-class packages, it will be fairly trivial to exchange bitcoins for cash if you really need to."
Sure, but having it declared illegal would definitely restrict the growth potential of the currency. At the moment its proponents envision/fantasize about it becoming huge and general-purpose, with a presence in the physical world (see bitpay etc). If a large nation like the US were to declare it illegal would certainly put a dent in that.
I disagree with a lot about BTC, in terms of the economic choices made in its model rather than the technical ones, but I find it continually fascinating to watch it as a phenomenon.
Why foolish? Risky, but not necessarily foolish. The bitcoin exchange rate has been going up all the time. Even with simple strategies such as dollar-cost averaging you would probably have done pretty well within the last couple of years.
I think its foolish because your investment is based on something that you have no control over, nor any ability to rationally judge risk. The US government could collapse the value of bitcoin in an instant by declaring it illegal. It's probably only a matter of time until they do this actually. Unless you have a good reason to think this won't be for another X years, investing is a bad bet.
It probably depends on whom you ask and what the currency is. Something like Bitcoin could be seen as very subversive. Money is an asset/liability relationship, there is no intrinsic value in a fiat currency.
I also think a government could make it illegal and if it's a key government or even more than one it will impact the bitcoin market tremendously.
It's not unheard of for a government to do something like this, my understanding is that it was done with gold at some point.
The will use an excuse such as terrorism, money laundering (because it competes with HSBC and similarly too big to fail banks), drugs, or whatnot.
How can they enforce it ? block the protocol ? ban tor too ?
I think it is more likely they'll use any mean available to stop bitcoin from becoming mainstream.
In particular, all the payment processors are a bit iffy with bitcoin, instead of embracing them.
Seems like Paypal, Visa, Mastercard, AMEX, diners and the various banks are to bitcoin what mpaa, riaa, GEMA and what not are to copyright, some sort of MAFIAA imposing their dead business model.
Do you know how many governments have acknowledged bitcoins ?
Is it legally a currency or just some collector's trading of post stamps and things like that?
The current way of exchanging Bitcoins is not decentralized at all. I guess the first thing governments will do, if they ever consider Bitcoin a real threat, is to try to shutdown the major exchanges.
If they succeed, which still will be hard, I'm not entirely sure Bitcoin will continue to be that usable in spite of other decentralized ways of exchange like http://bitcoin-otc.com/ or http://localbitcoins.com
Lots of Bitcoin businesses are online services. If US businesses are banned from offering Bitcoin services, this will just bring more customers to services operated in other countries.
Probably harder than it sounds now. Last time I checked, miners run custom made ASIC rigs. It's no longer kids with cheap GPUs and ROIs north of 100%. The network is 20 Thash/s and growing. Getting up to 51% would take a major budget and sophisticated acquisitions and ops. While the USG could do it, it would likely cost way more than the cost of letting the bitcoin network live.
All these years we've been reading on HN how Dwolla was supposed to be different than PayPal. As a passive observer I've taken their marketing message/value proposal to be specifically that they were not the type of company who would ever execute these PayPal style seemingly thoughtless account suspensions.
At this point unless the facts turn out to be different than presented here, I will never be a Dwolla customer.
Describing this as "for bitcoiners" is misleading.
The suspicious activity that this user's account was suspended for was a payment (in USD) from one individual to another, that Dwolla suspected was an "unlicensed BTC exchange" (not necessarily on a commercial scale.)
Using a network like bitcoin-otc is a solution only if the USD side is paid in cash.
Dwolla was shitty to Bitcoin users earlier on. That's why I still have a bad taste in my mouth when hearing about them. Fortunate for them, I still hate Paypal more.
Further, the reason people used Dwolla in the first place was because of their "no chargebacks" policy, which doesn't even exist anymore.
Actually, even when they had their "no chargebacks" policy, they started secretly processing chargebacks, and not even telling the people they were taking money from.
Google for the story about how Dwolla bankrupted the TradeHill exchange by stealing money from them, not showing any affadavits for the money they took from them, and then blocked them from even withdrawing their own funds.
I barely use Dwolla now. Coinbase (YC S12) has replaced it for me.