Posts Tagged ‘Bitcoin’

Popular Online Poker Currency Bitcoin watched by US Govt.

Sunday, March 24th, 2013

Bitcoin (a.k.a. bitcoins) has become a very popular currency in the online poker world. Bitcoin isn’t backed by a central bank or country, and it can be sent across the internet anonymously through “wallets.” This allows poker players to easily make deposits and withdrawals from poker rooms without worrying about huge delays and hassles.

Unfortunately, it looks like the ease of use aspect could be gone because the US government has been focusing on bitcoins. Furthermore, the American government has applied money laundering laws to virtual currency in a move designed to target Bitcoin.

The Wall Street Journal discussed the money laundering laws by writing, “online cash will now be regulated in a similar manner as traditional money-order providers such as Western Union. They would have new bookkeeping requirements and mandatory reporting for transactions of more than $10,000.”

At first, this may seem like another selfish move by the US government to hurt the online poker industry since they’re not drawing tax revenue from it. However, applying money laundering laws to Bitcoin and other virtual currencies is more about eliminating drug-based crimes. The WSJ discussed both the legal and illegal side of bitcoins with the following:

Bitcoins can be used in a host of legitimate transactions—for example, website Reddit allows users to upgrade services using bitcoins and blog service WordPress.com’s store accepts them as a form of payment. Pizzaforcoins.com also lets bitcoin savers pay for deliveries through Domino’s and other pizzerias.

On the other hand, at least one online service takes bitcoins as payment for illegal drugs, according to a Federal Bureau of Investigation report last year. Bitcoin’s backers point out that criminals will use any currency for money laundering or illegal purchases.

After the new stipulations placed on virtual currencies, the value of bitcoins has already fallen from $60 a unit to $49. Of course, this doesn’t mean that the currency will suddenly become obsolete. However, its use among US online poker players may drop significantly. Seeing as how many US-friendly poker sites are relegated to paper checks, which can take weeks to process/send, this definitely isn’t good for the game.