Dwolla shuts doors to bitcoin companies and virtual currency exchanges
Dwolla has announced it can no longer work with virtual currency exchanges and other bitcoin-related services. The online payment system provider emailed its customers who operate companies related to bitcoin and other virtual currencies to inform them it is withdrawing its services as of 28th October at 16:00 CT. Dwolla's reasons for doing so aren't exactly clear, with the email stating: "Recent interest involving virtual currency and its exchanges has created uncertainty and confusion around virtual currency, and Dwolla's relationship with a small number of its exchanges. This has forced....
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Users of the online payment network Dwolla began reporting Tuesday afternoon that an order from the US Department of Homeland Security (DHS) was preventing them from transferring funds to and from Japan-based Mt. Gox, the world's largest bitcoin exchange. Based in Des Moines, Iowa, Dwolla lets users send and receive money to and from their bank accounts without incurring costly transaction fees. Most Dwolla transactions are completed for a $0.25 fee, and many bitcoin buyers and traders use the service to send payments to Mt. Gox. As of press time, Dwolla had not responded to an email....
The idea that the US government cannot regulate businesses which only operate on the internet will come as news to the online poker and gambling companies shut down by the US in recent years. Or indeed Kim Dotcom recently arrested in New Zealand because his Megaupload site upset the US. So it should come as no surprise to see US authorities taking action against US-based Dwolla. Nor that the action sends ripples through the market - Mt. Gox politely declined to talk to CoinDesk today citing advice from its lawyers. Exchanges are likely to be the first front line in this war - Bitcoin can....
The world's largest Bitcoin exchange, MtGox, had its account with Dwolla closed down by the order of the Department of Homeland Security. The fact was first discovered on Monday when OKCupid cofounder Chris Coyne posted a screenshot of an email from Dwolla saying that his deposit to MtGox could not be processed because of "recent court orders by the Department of Homeland Security and US District Court for the District of Maryland seizing the account of Mutum Sigillum LLC (Mt. Gox)" The next day, DHS officials provided the warrant used to shut down the account, exposing the reason why the....
After a series of mishaps working with bitcoin startups – including the infamous, now-defunct bitcoin exchange Mt Gox, Dwolla is once again hoping to work as the connector between the emerging technology and traditional financial worlds. The alternative payment network has been quiet about its foray in the blockchain space, but Ben Milne, Dwolla's founder and CEO, says the company is working closely with startups building solutions for tracking assets on the blockchain. As assets are sent from one blockchain to another or from one business to another, there will have to be a real-world....
So exactly what is in that court order that the US Department of Homeland Security used this week to clamp down on Dwolla-Mt. Gox transactions? It appears the feds have decided there's reason to believe Mt. Gox and a subsidiary are operating as unlicensed money transmitting businesses in violation of US law. Ars Technica obtained a copy of the seizure warrant issued in US District Court in Maryland and signed by US Magistrate Judge Susan K. Gauvey. The seven-page warrant cites an affidavit made by a special agent with Homeland Security Investigations (HSI) stating there is probable cause....