9 ms·

I used it to transfer money between countries with an exchange rate better than any other available. Surely this is not illegal?

by dreen 9y ago

eloff 9y ago
It is in China now. Russia too IIRC. Probably several other countries that impose capital controls. In the west this is legal, but the bank may still ask you where the money came from under their enforcement of laws like knowing your customer and money laundering controls. Tax agencies may also get involved if there is automatic reporting.
- the_mitsuhiko 9y ago
  How is it illegal in Russia?
  - eloff 9y ago
    https://www.bloomberg.com/news/articles/2016-04-28/russian-law-would-send-bitcoin-users-to-jail-as-cybercriminals https://www.bloomberg.com/news/articles/2016-04-28/russian-l...
    - flatfilefan 9y ago
      this has never become a law afaik
      - eloff 9y ago
        Not yet anyway, laws take time. I hope it doesn't become law (and I suspect it's too extreme for that, even for Russia.) But it gives you an idea of the way things are trending there.
sboselli 9y ago
Yes, unfortunately, that is indeed illegal. That's exactly what capital flight is (one of its forms), and what most thrid-world countries try to avoid by these banning practices. They (we) have shitty unstable currencies and broken banking systems that the people have no trust in, so they use their savings to buy USD (hard to do in these countries) or Bitcoin to maintain value. Note that money doesn't even need to leave the country for it to be a form of capital flight; just the fact alone that you're buying foreign currency or Bitcoin in a black market.
occamrazor 9y ago
Forex commissions are lower than 1%. Which exchanges offer better rates on a fiat/bitcoin/fiat transfer?
- sushid 9y ago
  Kraken is ~.26% for a taker and ~.16% for a maker. And in some places, you have to jump through a lot of hoops to send money.
  - yourapostasy 9y ago
    Unfortunately, many companies still insist upon remitting in paper checks, especially for cross-border transactions. If I could route a paper check remittance to a BTC/ETH exchange like Kraken, buy into BTC/ETH in that paper check's denomination, then immediately sell and withdraw as USD, then I and many other vendors could solve that use case. If anyone knows of a BTC/ETH exchange with turnarounds even faster than forex brokers, and can process paper checks, then please post who you use. For a world economy that is supposed to be a global integrated entity, the amount of rentier hurdles sitting on the borders never ceases to amaze me. For the few customers that agree to a wire transfer, I'm trying out a cryptocurrency exchange in 2018 to convert them to USD.
- yourapostasy 9y ago
  Where are you getting below 1%, and how much are you exchanging? I'm working with 5-figure USD amounts, drafted on paper checks, and I'm averaging right around 1-1.2% after all costs are accounted for, but not below that.
  - tonfa 9y ago
    Stock broker with FX, market spread and low fee, total result can easily be less than 0.1% (and even a lot less most likely closer to 0.01%).
    - yourapostasy 9y ago
      How do I get in touch with a "Stock broker with FX"? That's not a term I'm familiar with unfortunately, and searching that string turns up either FX brokers, or FX trading platforms. I've spoken with my US equities/funds brokerage firm, and they have an FX desk, but they're still more expensive than the dedicated FX broker I found and currently work with. Before that, I was regularly raked by my US bank for 4-6% off the mid-market. I haven't seen mid-market spread + 0.01% anywhere, and only seen + 0.1% thrown around for 6-figure and up USD transaction sizes, wire transfer (ACH or SWIFT), at least several of those per month volume. TransferWise works at mid-market + 1%; but they don't work with paper checks. What you're getting is even better than cryptocurrency exchange-facilitated conversions, so I'm very interested in finding out more if you can post a pointer in the right direction. Thanks.
throwaway613834 9y ago
This is a great example of something that just boggles my mind. With all the regulation out there (on financial stuff in this case), how do people naturally come to the conclusion that such a scheme bypassing them is not illegal? (genuine question; not disparaging you)
- gph 9y ago
  Well that is sort of a common law view of things. But most countries practice case law, which means if somethings not explicitly illegal then it must be legal. So I don't think circumventing the law is seen the same way as it would over in the anglosphere, where we'd condemn someone for intentionally not following the 'spirit of the law' and a judge/jury might convict them anyways. Disclaimer: IANAL and perhaps a bad judge of how people around the world view the law.
  - throwaway613834 9y ago
    > Well that is sort of a common law view of things. But most countries practice case law Aren't these the same thing? [1] Do you mean something else (civil law)? But that's a great point; maybe the problem is my lack of living in a purely civil law country. The thing is though, it seems more like common sense to me than a legal issue. Like for example, if (say) murder with a knife and a gun had been illegal, but there was no law against using baseball bats, then suddenly everyone in a civil law system would naturally assume using baseball bats to kill would be okay? It just doesn't make sense to me that "whatever is not expressly illegal must be legal", whatever the legal system... but maybe you're saying that would actually stand up in a civil-law court, and people would actually be okay with it? It's also quite counter-intuitive to me since the US (with its common law) seems to be quite prominent in its tendency to let its people and companies stick to the letter of the law but not its intent. e.g. so many corporations find legal loopholes to take advantage of all sorts of people (from consumers to politicians) by means which are not technically expressly illegal but which almost surely are out of line with the spirits of many existing laws. [1] https://en.wikipedia.org/wiki/Common_law https://en.wikipedia.org/wiki/Common_law
    - 9y ago

I used it to transfer money between countries with an exchange rate better than any other available. Surely this is not illegal?

by dreen 9y ago

I used it to transfer money between countries with an exchange rate better than any other available. Surely this is not illegal?

eloff 9y ago

It is in China now. Russia too IIRC. Probably several other countries that impose capital controls. In the west this is legal, but the bank may still ask you where the money came from under their enforcement of laws like knowing your customer and money laundering controls. Tax agencies may also get involved if there is automatic reporting.

the_mitsuhiko 9y ago
How is it illegal in Russia?
- eloff 9y ago
  https://www.bloomberg.com/news/articles/2016-04-28/russian-law-would-send-bitcoin-users-to-jail-as-cybercriminals https://www.bloomberg.com/news/articles/2016-04-28/russian-l...
  - flatfilefan 9y ago
    this has never become a law afaik
    - eloff 9y ago
      Not yet anyway, laws take time. I hope it doesn't become law (and I suspect it's too extreme for that, even for Russia.) But it gives you an idea of the way things are trending there.

sboselli 9y ago

Yes, unfortunately, that is indeed illegal. That's exactly what capital flight is (one of its forms), and what most thrid-world countries try to avoid by these banning practices. They (we) have shitty unstable currencies and broken banking systems that the people have no trust in, so they use their savings to buy USD (hard to do in these countries) or Bitcoin to maintain value. Note that money doesn't even need to leave the country for it to be a form of capital flight; just the fact alone that you're buying foreign currency or Bitcoin in a black market.

occamrazor 9y ago

Forex commissions are lower than 1%. Which exchanges offer better rates on a fiat/bitcoin/fiat transfer?

sushid 9y ago
Kraken is ~.26% for a taker and ~.16% for a maker. And in some places, you have to jump through a lot of hoops to send money.
- yourapostasy 9y ago
  Unfortunately, many companies still insist upon remitting in paper checks, especially for cross-border transactions. If I could route a paper check remittance to a BTC/ETH exchange like Kraken, buy into BTC/ETH in that paper check's denomination, then immediately sell and withdraw as USD, then I and many other vendors could solve that use case. If anyone knows of a BTC/ETH exchange with turnarounds even faster than forex brokers, and can process paper checks, then please post who you use. For a world economy that is supposed to be a global integrated entity, the amount of rentier hurdles sitting on the borders never ceases to amaze me. For the few customers that agree to a wire transfer, I'm trying out a cryptocurrency exchange in 2018 to convert them to USD.
yourapostasy 9y ago
Where are you getting below 1%, and how much are you exchanging? I'm working with 5-figure USD amounts, drafted on paper checks, and I'm averaging right around 1-1.2% after all costs are accounted for, but not below that.
- tonfa 9y ago
  Stock broker with FX, market spread and low fee, total result can easily be less than 0.1% (and even a lot less most likely closer to 0.01%).
  - yourapostasy 9y ago
    How do I get in touch with a "Stock broker with FX"? That's not a term I'm familiar with unfortunately, and searching that string turns up either FX brokers, or FX trading platforms. I've spoken with my US equities/funds brokerage firm, and they have an FX desk, but they're still more expensive than the dedicated FX broker I found and currently work with. Before that, I was regularly raked by my US bank for 4-6% off the mid-market. I haven't seen mid-market spread + 0.01% anywhere, and only seen + 0.1% thrown around for 6-figure and up USD transaction sizes, wire transfer (ACH or SWIFT), at least several of those per month volume. TransferWise works at mid-market + 1%; but they don't work with paper checks. What you're getting is even better than cryptocurrency exchange-facilitated conversions, so I'm very interested in finding out more if you can post a pointer in the right direction. Thanks.

throwaway613834 9y ago

This is a great example of something that just boggles my mind. With all the regulation out there (on financial stuff in this case), how do people naturally come to the conclusion that such a scheme bypassing them is not illegal? (genuine question; not disparaging you)

gph 9y ago
Well that is sort of a common law view of things. But most countries practice case law, which means if somethings not explicitly illegal then it must be legal. So I don't think circumventing the law is seen the same way as it would over in the anglosphere, where we'd condemn someone for intentionally not following the 'spirit of the law' and a judge/jury might convict them anyways. Disclaimer: IANAL and perhaps a bad judge of how people around the world view the law.
- throwaway613834 9y ago
  > Well that is sort of a common law view of things. But most countries practice case law Aren't these the same thing? [1] Do you mean something else (civil law)? But that's a great point; maybe the problem is my lack of living in a purely civil law country. The thing is though, it seems more like common sense to me than a legal issue. Like for example, if (say) murder with a knife and a gun had been illegal, but there was no law against using baseball bats, then suddenly everyone in a civil law system would naturally assume using baseball bats to kill would be okay? It just doesn't make sense to me that "whatever is not expressly illegal must be legal", whatever the legal system... but maybe you're saying that would actually stand up in a civil-law court, and people would actually be okay with it? It's also quite counter-intuitive to me since the US (with its common law) seems to be quite prominent in its tendency to let its people and companies stick to the letter of the law but not its intent. e.g. so many corporations find legal loopholes to take advantage of all sorts of people (from consumers to politicians) by means which are not technically expressly illegal but which almost surely are out of line with the spirits of many existing laws. [1] https://en.wikipedia.org/wiki/Common_law https://en.wikipedia.org/wiki/Common_law
  - 9y ago