Around the world, half a dozen cybercurrency sites were shut down last week. The URL addresses of the sites have been changed. All attempts to get into them by investors have been blocked. The site addresses have been re-routed.
The new site address owner is refusing to say what is going on. It is obvious what is going on. The United States government has shut them all down. People who used these services cannot access their money.
The head of one of the largest operations, Liberty Reserve, was arrested in Spain. He is a Ukrainian and a citizen of Costa Rica.
One of the companies involved in digital currency transfers is Perfect Money. Here is a description from its site.
Perfect Money is a leading financial service allowing the users to make instant payments and to make money transfers securely throughout the Internet opening unique opportunities to Internet users and owners of the Internet businesses. Perfect Money targets to bring the transactions on the Internet to the ideal level!
It just got a lot less perfect. This announcement was posted last week.
Dear Perfect Money Customers,
We bring to your attention that due to changes in our policy we forbid new registrations from individuals or companies based in the United States of America. This includes US citizens residing overseas. If you fall under the above mentioned category or a US resident, please do not register an account with us.
We apologize for inconvenience caused.
The screws are tightening on digital money sites.
Bottom line: the U.S. government reserves the right to shut down any website on earth, at any time — no appeal.
Meaning: you can put your legal digital money into these sites. Then, without warning, these sites are defined by the U.S. government as money-laundering sites. They mysteriously go offline. Think of them as roach motels: your money goes in. It does not come out.
This statement appears on the website of the U.S. Department of Justice.
Federal officials have acknowledged the need to close the regulatory loophole that exists in relation to digital currencies. Despite industry assertions that digital currencies are not subject to regulation, as well as the formation of several trade associations and consortiums attempting to demonstrate industry self-regulation, U.S. Government entities are exploring the application of consistent federal regulation over the digital currency industry–which promotes itself as unregulated and anonymous. Additionally, because the value of digital currency accounts changes with the market performance of the backing commodity, any profits earned (capital gains) during the withdrawal of digital currency accounts may not get reported to the IRS unless the digital currency account holder decides to declare the amount voluntarily.
The war for privacy goes on.