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Comment by sekai | Hacker News Reader

Mining fees are needed for securing the network, pretty reasonable.

By providing KYC and regulation, Visa/Coinbase also secure the network.

You know better than that. He was referring to information security, not legislative compliance.

It's as much fraud control as legislative compliance. From the perspective of consumers, considering a payment network as 'secure' requires fraud control - by ability to reverse fraudulent transactions and/or making it hard or expensive for fraudulent recipients to sustain operations.

In terms of fraud protection, the bitcoin network is only responsible for ensuring a double spend will not happen. I don't think it should be the 1st layer protocol's responsibility to also handle chargebacks and fraud claims... these issues need to be settled by intermediaries who are willing and able to deal with these customer issues.

They're one and the same thing. Compliance is a way of demonstrating that you have met certain data and information security standards.

KYC has zero to do with information security, and there's a legitimate argument that much of the regulation is anti-competitive regulatory capture with the primary goal of preventing new entrants in the market, with "security" being a secondary concern.

KYC isn't some conspiracy to keep Bitcoin firms out - it's a vital protection against money laundering, terrorist financing and checking for identity theft.

There are very real consequences in the real world when these checks get skipped or overlooked.

Nobody said anything about it being a conspiracy. It's not a conspiracy that entrenched actors advocate for rules they can trivially follow that just happen to kneecap upstarts. It's an expected and recognized behavior of large entities.

That goes double when "terrorism" is brought up, which is a metasituational justification for nearly any conceivable rule.

They aren’t trivial to follow - Standard Chartered were fined $1.1bn for AML non compliance, Swedbank and Danske have lost their CEOs. KYC is vital for the integrity of the economic system precisely because ML is as prevalent as it is.

That's not true. KYC is for preventing money laundering and terrorist financing. You do NOT want the RCMP/FBI asking why you permitted terrorists to use your platform.

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