In the United States this would impose obligations on the owner of the bot to log info and request KYC info from users to comply with the Bank Secrecy Act I believe. I'm not sure where tippero lives, but I imagine there are similar regulations in other countries. Does anyone have any insight into what levels of money would make a bot or other service fall into this category in any jurisdiction?

  • Does tippero charge a fee? If not, is it a business? – BitShrink Oct 8 '16 at 16:32
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    It does charge withdrawal fees and has house odds on dice. – jwinterm Oct 8 '16 at 17:39

It depends if the tipbot is operating as a business. The term “business” has been defined as that which occupies the time, attention, and labor of men for the purpose of livelihood or profit. The activity (hosting and maintaining the tipbot) must be continuous and there must be an intent to profit, see Commissioner v. Groetzinger.

If the withdrawal fees and house odds are motivating factors for running the service, then yes, the tipbot might be considered a money service business in light of the FinCEN’s guidance on the Regulations to Certain Business Models Involving Convertible Virtual Currencies given that the tipbot operates as a hosted wallet service. Hosted wallet providers receive, store, and transmit cryptocurrency on behalf of accountholders. Accountholders do not have exclusive possession and control over their respective wallets’ mnemonic seed and interact directly with the tipbot instead of the cryptocurrency core software (see FinCEN Guidance, pp. 15-16). As such, a tipbot operator must have an anti-money laundering program and follow the procedures for identifying, verifying, and monitoring both the user’s identity and risk profile. In addition, the Funds Travel Rule would apply if transfer amounts are equal to or greater than 3,000 USD. Although, I'm not sure how this rule could be practically followed in the context of Monero.

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Gov'ts seem to like making rules and seem to think that numbers (aka Mathematics, aka. crypto currencies) must be regulated by them.

Check your gov't, but assume the answer is yes.

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I would imagine the amounts would be too small for any regulator to care. Its not like people are going to be tipping 5000 bucks or something (maybe you'd have to put a cap on amount one can tip).

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