According to the U.S. Department of Treasury FinCen: Money Service Business Definition. The term "money services business" includes;
any person doing business, whether or not on a regular basis or as an organized business concern, in one or more of the following capacities:
- Currency dealer or exchanger.
- Check casher.
- Issuer of traveler's checks, money orders or stored value.
- Seller or redeemer of traveler's checks, money orders or stored value.
- Money transmitter.
- U.S. Postal Service.
According to the IRS's Virtual Currency Guidance, and in more detail,
For federal tax purposes, virtual currency is treated as property. General tax principles applicable to property transactions apply to transactions using virtual currency.
The way I understand this is, You don't fall under any capacities as a "Money Service Business" if;
- Cryptocurrency is to be treated as property, NOT CURRENCY OR MONEY.
- Don't allow exchanging from cryptocurrency to fiat.
- Don't allow exchanging from fiat to cryptocurrency.
- Only allow Cryptocurrency-to-Cryptocurrency exchanges.
Is this correct?
If not, please explain why using the previously mentioned guidelines/documents or any other document or statement issued in an official capacity by a U.S. agency stating why this is incorrect.
