Licensed - yes, but "legally treated as a bank" - bullshit.

A licence for a currency exchange office is MUCH MUCH simpler than a bank licence. Lots of those currency exchange places are really small, running as a sole proprietor tiny business by one or two people. The "licencing" is pretty much just registering, and if you meet basic requirements (like not being a convicted criminal for financial crimes, and finishing some course of handling money), you just get it.

Starting a bank is about a million times more larger complication then stating a currency exchange business. Currency exchange company is nowhere near being "legally treated as a bank", as they can not borrow to someone else money which was deposited to them - that is what distinguishes a bank from not-a-bank - being able to lend money which people deposited with your. There are literally thousands, if not millions of small businesses in Europe legally doing all kinds of money-handling business, from currency exchange to money transfer, heck even a credit card processing company is not a bank, and they are lots of these popping-up.

think of the money you could make from starting a cash-to-btc street office chain...


http://img16.imageshack.us/img16/8422/hazthebitcoin.jpg

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I know several companies providing financial services, NOT being regulated, and successfully getting around that by: instead of customers making deposits, customers are "buy" "points" (for example at an exchange rate 1 cent = 1 point) and those points sit in customers account, and when the customer wants to withdraw, he is "selling" those points. These are quite large companies in Poland operating this way, providing online auction services, social lending, etc. All of them use the legal trick with "points", instead of simply deposits in currency. And it works, authorities are not touching them.

I sincerely believe this idea to be worthy of consideration.

If some B- (I'm being generous here) sci-fi writer can start a worldwide religion, so can we.

P.S.:
Re the whole "is it money" issue - bitcoin is "money" to the same extent that China is a giant, living organism

Whatever we think of it is legally irrelevant. Perhaps it will define a new asset class. But if the European Union accepts bitcoin as money, to settle all debts public and private...

Bitcoin is certainly not Fiat Money. However, Bitcoin can serve as a medium of exchange; a unit of account; and a store of value. But Bitcoin does not fit neatly into any of the categories for types of money. See
http://en.wikipedia.org/wiki/Money#Types_of_money
Bitcoin has some characteristics of commodities, some of money and some new characteristics. Bitcoin is really a new category because it does not fit into any of the previous categories.

Do you agree?
It looks that there are three issues on stake.

a) The definition of WHAT THE HECK IS BITCOIN. Let me give a dummy aproach.
It's clear now to me that Bitcoins itself are no "Money", just exchangeable "virtual assets" assigned not to people but to particular "digital certificates". Assets that are generated with not a single $ put on it (other than the tools+labor "energy" used to harvest it - such as hands+human energy or computer+electricity to mine virtual assets), and can be exchanged for any other king of asset such as money, gold, goods, etc. This is simillar as to creating an ashtray from mud and sell it in my front door to people (when I was a little kid), its price would be based in the effort to do some newone my self, getting an other similar to it, or the uniquity of my creation. I believe this makes Bitcoin similar to a regular "asset" aproach. Perhaps we should all replace the definition of "virtual currency" for "virtual asset".

b) Is it legal to trade Bitcoins for regular money? An if so, should it have taxes or regulations?
I believe that any "other" asset is absolutelly legally to trade, this shouldn't be an exception (unless... read "c"). If we love bitcoins because they can exchanged from Person 2 Person (the original idea), no one should forbid such (P2P is usually used for piracy, but this has nothing to do with it), as regular money isn't forbidded to exchange hands freely. But if this exchange has to be done over an exchange or formal platform it should pay taxes as any other asset.

c) What might come next?
a- If governments believe that BTC cand o will be used as a way of avoiding taxes, crossborder regulations, money laundering, etc, it cares not if there are actual laws or new laws... they will just regulate it. If the first one is good for Bitcoins or not, who knows, I think that even though we shoukd tell who we are, pay taxes, etc, BTC will have fewer transaction fees, fewer asset holding fees (vs money in banks), quicker payment recieving, unfakeable and controled emission, etc, all things that will still make the BTC interesting as an asset.
b- IF governmets think that the Bitcoin protocol, network, blockchain, etc is unsecure, they might try to shut it as for avoiding people to invest regular assets in this unsecure asset, but thought it looks secure enough this shouldn't be the case. But if so, trolls, noobs, regulars we be glad.

So I believe this should come fine for MtGox as a trader unless his LCC has no legallity to trade assets, but if we keep on the trace of mainstreaming it we should expect some general regulations.

+1 well said, modrobert.

Good to see that MtGox has already debunked two of the most bitcoin myths. Bitcoin is not anonymous. Bitcoin is not "tax free".