New York Duels California to Write Bitcoin Rules

cali-newyork27 Jan 2014 / Bloomberg – California and New York, home to Silicon Valley and Wall Street, are preparing to write rules of the road for entrepreneurs driving a surge of interest in Bitcoin and other virtual currencies.

The outcome could determine how big a threat Bitcoin poses to established payment companies including JPMorgan Chase & Co. and Visa Inc. as well as where venture capital and talent converge to form a geographic hub for U.S. startups.

“If a state becomes Bitcoin-friendly, it will see a huge increase in companies,” said Adam Ettinger, an attorney with San Francisco-based Strategic Counsel Corp., which advises technology investors. “That will mean the brightest minds working on some of the most innovative payment technology we’ve seen in awhile.”

Related: Bitcoin Seen as Safe Haven in Brazil Boosts Online Trade

Bitcoin, a five-year-old protocol for issuing and moving money across the Internet, has gained traction with merchants selling everything from Sacramento Kings basketball tickets to kitchen mixers on Venture capitalists see promise in it as an alternative to the global payment system currently dominated by companies including Visa, Western Union Co. (WU) and large banks.

Bitcoin’s legal status has been uncertain. In March, the U.S. Treasury Department’s Financial Crimes Enforcement Network, which polices money laundering, said virtual-currency firms may be regulated as money transmitters. The move set off the race among states, which license such firms, to determine if and how their laws apply….. Read more

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