Bitcoin Foundation is not a Money Transmitting Business

As Jon Matonis disclosed on Forbes, The California Department of Financial Institutions has issued a “Cease and Desist Letter” to the Bitcoin Foundation. They don’t seem to understand that the Foundation is not a Money Transmitting Business.

The Bitcoin Foundation as such is not transmitting money. They are developing software which enables other people to transmit money.

Even if they stopped doing so immediately, people would still be able to use the version of the software released right now and continue transmitting money, without any third party money transmitting business involved.

The interesting thing is, Bitcoin actually gets rid of “money transmitting businesses”. Everyone everywhere on the planet can transmit money to everyone else, without needing any third party to do so. In a world where everyone has switched from the inferior traditional currencies to Bitcoin, money transmitting businesses will disappear.

So the Bitcoin Foundation is not a money transmitting business. They are a money transmitter eliminating business.

 

Published by kflenz

Professor at Aoyama Gakuin University, Tokyo. Author of Lenz Blog (since 2003, lenzblog.com).

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