Bitcoin infrastructure evolving to enable greater use for payments by Solomon Teague:
If the challenge was difficult at the beginning of the year, it’s even more difficult now. Many bitcoin-related businesses prefer to stay away from the US, fearing the attentions of its legal and regulatory enforcement agencies, and the recent court ruling defining bitcoin as a legitimate currency further complicates matters. An escrow doing business with a US counterparty, or facilitating a trade with a dollar component, might run into compliance issues with US regulators. “As bitcoin transactions go beyond boundaries, I might have to block my site from US residents until the legal area is clearer,” says Colbert Low, a bitcoin trader who runs BTC-Asia, a bitcoin escrow service. Luczywo does not believe banks are best placed to evolve in the bitcoin space. “They are too big to be efficient, there is too much clutter around what they do and too many compliance issues.” he says. “Bitcoin is a free-market vehicle while contemporary banks don’t operate in the free market.” A number of bitcoin escrow services already exist, including Low’s BTC-Asia in Malaysia, Australia-based BTCrow and ABEscrow in Hong Kong. BTC-Asia does five to 10 deals a week, typically involving trades of between one and 50 bitcoins. It offers dispute-resolution services where necessary, although to date this service has not been called upon, says Low. Deals are conducted on behalf of fellow traders, principally for local traders in Malaysia or Singapore, principally in cross-cryptocurrency transactions, where traders are exchanging bitcoins for litecoins, for example.