* Coinbase: A startup that holds millions of dollars worth of bitcoin for mostly consumers
* The reddit tip bot: a non-profit community tool that explicitly discourages holding more than a dollar or two
* Blockchain: A startup that holds no money for anyone, but writes and serves software that helps people hold their own money online.
Do you think all three of these groups should go through this process?
The Money Transmission Framework is a combination of two types of rules:
1. Capital Requirements, licensing and Bonding for people who hold money for consumers who are not banks. These rules are consumer protection laws and make sense for businesses that offer custodial accounts denominated in bitcoin or dollars. These rules could have been applied to Instawallet, Coinbase, Mt. Gox, etc.
2. AML + KYC rules. These require people who help move money into and out of the banking system to find out who their customers are and report them to law enforcement when they do the unexpected. These rules could be applied normally to people doing exchange services, like Expresscoin, BitInstant (RIP), CoInvoice, etc.
I've spent years and hundreds of thousands of investor dollars examining the issues here, like you have. Stay tuned for a policy piece describing when these rules make sense and when they don't. Hint: If you are just posting software to github, these rules do not make sense to apply to you.
Banks actually do have to ask for permission for "new lines of business", aka new products. The theory going around is that he asked for a best case scenario for the regulator and the goal of the comment period is to see what the industry cares enough about to push back hard. His goal is to have a regulation come out of the comment period that all of the "Big Bitcoin" startups and VC's like enough to apply instead of sue. He'll probably get what he wants.