I currently run a (reasonably) successful startup with my brother, we have a lot of cash parked in a savings account with them. My current startup will also be providing the initial funding so I have adequate cash flow to start accepting orders.

I also informed the bank beforehand that:

- I'll be selling Bitcoins
- I'll possibly be handling lots of small value bank transfers

They told me that they don't have an issue with Bitcoin selling, and that there should be no issues with volume/size of transactions.

I did a bit of research into casual fraud relating to bank transfers (a reason someone helpfully PMd me as a reason another similar startup failed in the UK). The bank told me that once a transfer is in your account, it can't be reversed. Did a bit more research and it turns out that it can be reversed as long as it's on the same working day. To mitigate against this risk the order process is:

- Receive payment
- Payment clearance (24 hours)
- Order fullfilment

I'm also going to have a maximum transfer limit which will initially be fairly low (~£300-£500) and slowly increase this as my cashflow improves and I become more confident that fraudulent payments are not possible. This should reduce any potential loss if a fraudster suceeds somehow.

There is of course a possibility they shut my account down. It all seems likely to me though that it should be OK.

I've also spoken to a technical officer at HMRC (UK tax collectors) who explicitly told me there is no regulations around Bitcoins, they are treated as a commodity. For this reason I don't need to sign up for money laundering regulations, but the situation may change in the future. Looking at UK MLR it all looks cheap, fairly easy to sign up for and comply with anyway.

tldr; just going to try it and see what happens!

Gullanian

you should definitely post on www.bitcointalk.org forums, they will give you much better advice and they are your target audience

Hi Gullanian,

To become a licensed money transmitter I was quoted 250k. It seems like it's not required at this point which is nice but you may want to prepare for it being a requirement in the future.

Skip to the UK section on this page and there is a bit of information on it.

Good luck with your venture.

Wow.. dude really?

If you have a dedicated 'Tor', (happy now?), set up, that you don't use for any other 'non anonymous' browsing you are *probably* fine.

The 'non savy' peeps I was referencing were those that 'alt-tab' between Tor and normal browsing and who think the invisibility cloak is working.. it ain't.

How so?

Hey Gullanian,

The site looks great! Nice work. Did you do the design/CSS work yourself?

I have a ton of technical questions that I don't want to clog this thread up with. If you ever have a few minutes and feel like answering them, shoot me a PM.

Thanks! Did it all myself yes except the logo which I got done on 99 designs.

Feel free to PM me!

Just a thought for the longterm outlook of bitcoin. With 3-d printing on the brink... obviously there will be some sort of laws created trying to stop people from downloading the data to build things for free like they did with music.

Bitcoin may be the preferred payment method for underground pirating of this data. That will be a huge market.

Why do you think they will be able to stop people from sharing and downloading data? There is no huge market for pirating copyrighted songs. Everything is free.

True. I guess it comes down to how hard you want to look for stuff. A company that makes it super easy to find any pirated items you want fast and safe will charge for it and people will pay.

LOL @ Econ 101 being the argument here.

Yes, you eventually need an economy based on it. Speculation is a way to provide coins when they are more useful from a time when they are not as valuable (now). ECON 101!!!

noob alert -

Outside of drugs and bitcoin miners, are BTCs actually used for anything?

Baklava and alpaca socks

On a wide scale, not really, but yes at the same time. But they have been used for a wide range of items and internet services.

Poker.

Seemed to be used quite a bit for online gambling too.

Gullanian,

I don't get the hefty overpayment charge? Seems kind of ryanair-ish.

The extra 2.5% if the wrong currency is received ... does this just mean you'll give the rate for the currency that actually was sent and add 2.5% fees? Or will your bank have already converted the currency to match the recipient account?

Also, if you're not providing and sticking to a quote ( like xe.com would for example ), then it kind of feels like you should be offering the ability to cancel the transaction if the customer doesn't like the current rate when the cash arrives.

Anyway, I like the site. Although I'm not too sure about the lowercase ts in that colaborate font!

Thanks for taking a look!

The extra charge for over payment is because I really really don't want people sending more than was quoted. I want to make sure that I can fulfill as many orders as I can and provide a reliable service. If my cashflow dries up, I may be branded as unreliable.

If someone does overpay, doing a partial/full refund is going to take up a fair amount of time (especially considering it would be difficult to even contact the payer due to the way it works). I do have a backup plan for if I do get sent lots of overpayments/too many orders and my cashflow dries up. I have a fairly large pool of BTC I can borrow from, however borrowing Bitcoins is effectively shorting them, so the 15% extra fee should mitigate a lot of risk (it might take 10 days to get cashflow again).

Eventually I hope to eliminate such fees if it takes off, but the whole strategy is to start slow and slowly ramp it up as I learn more about it. Taking large payments at this stage doesn't fit in with that.

Wrong currency fee is there for along the same lines (wanting to be able to have good control over what comes in) although the way I plan to fulfill orders on the back is probably going to be slightly different than I originally planned so I think I can eliminate this shortly after getting up and running.

Regarding sticking quotes, it might be possible in the future once I've learnt a lot more about how it's going to work. I am planning on adding in a protection option though (ie, don't trade if the price falls more than x% when it's time to execute the order) but am still thinking of the best way to implement it.

so if i want to purchase bitcoins, what do i have to do, and where is the best place to do so?

Here is what I use it for:

1) Converting into other forms of money. Bitcoin is the most convertible currency in the world for most Americans and Europeans in amounts under 10k. So by holding bitcoins, on average I can convert into the most other forms cheaper and faster than any other form of money (paypal, USD in bank, cash in hand, GBP in UK bank, gold, poker money, Amazon credit, gyft credit, prepaid debit credit etc). There is a learning curve for some of the conversions though.

2) Charitable donations. A survey of the bitcoin community revealed that more people had donated to charity than had bought drugs. Bitcoin100.org will donate 1k to most charities if they add a bitcoin payment option on the donation page.

3) Settling debts with poker players or people who don't have the same bank as me

4) Paying for VPN service anonymously

5) A safety net. While traveling in any urban area, if I get robbed of my ID, cash, and bank cards, as long as I can get a few minutes of internet access, I can access some bitcoins and trade them to a stranger on localbitcoins for cash to get me by.

6) Betting sports at close to zero vig on btcsportsmatch.com

7) premiumize.me gives me access to most file hosters, TV shows, pandora, etc with proxies.

People use it for tons of other stuff that I don't even know about. 3rd world people who lack credit cards or a paypal account have been buying bitcoin from me to make online purchases shipped from the US.
https://en.bitcoin.it/wiki/Trade

Although they are vastly outnumbered by internet stores, here are some maps that show real world shops you can walk into and spend bitcoins.:
coinmap.org
bitcoin.travel

I disagree that poker is significant in the bitcoin economy. Seals has a max of 500 or so players online. I think it could be if seals started a US advertising campaign on how to instantly convert 5k in a US bank account to money on a poker site for 1% vig, but the owner won't do that.

mtgox.com is the biggest exchange to buy and sell bitcoins, but I have some if you want. All you need is a bitcoin wallet then for me to send to. You can google it and download one.

Damn I had this exact idea. Is it good?

Okay, to be honest I was thinking about it wrong.

You only need a "valid" bitcoin address to get a quote, so I assume you're expected a tonne of orders to not be paid for. Even if people are always genuine (clearly they aren't) then they'll still get to the quote page but just never send the cash. You even suggest that you just ignore quotes and reorder if you made a mistake, with no ability to cancel original one. That's pretty easy from the customer's perspective but it means using quotes to gauge your bitcoin requirements is going to be tricky. I not under any illusion you haven't already thought about all this.

Regarding sticking with quotes, xe.com (for example) book you a rate but then expect you to pay. They know who you are and will come down with legal threats if the cash never shows up. I know somebody who did this, xe agreed to take 50 to drop it, but he stiffed them on that too. He's even used them since without issue (and they didn't carve out the 50 from the next lot of funds).

Is that even legal? Why is the customer paying for your fees if you're choosing not to provide the service?

Perhaps a darker styling on the currency dropdown and make it a bit wider?

If you're in the US, use Coinbase.

If they send an international payment, to return the funds to them can cost ~£25 from my end. I want to be able to deduct this from the refund otherwise refunds can cost me money.

Order refusal isn't going to be a regular occurance, it's in my interest to fulfill as many as I can. But I need the ability to refuse orders on unforseen circumstances.