UPDATED 14:28 EDT / JULY 27 2011

NEWS

Bitcoin Expert Turned Away by U.S.Customs Over Lack of “Real” Money

What happens when you’re an expert and developer who uses a digital currency, fly into the U.S. to conference with other developers, and then U.S. customs cannot fully grasp the capabilities of your stock of virtual currency? You get sent straight back to China, of course. That’s what happened to Bitcoin developer, founder of the Global Bitcoin Stock Exchange, and self-styled cypherpunk, “Doctor Nefario” when he came to visit StartiPad.

Todd Bishop of GeekWire, picked up this story of the bitcoin guru’s experience with U.S. Customs.

Doctor Nefario—whose alias is a reference to a character from the animated film Despicable Me—says that he came into town to conference with entrepreneurs Mike Koss and Peter Vessenes from StartiPad. Koss, the StartiPad director, says that he has been contemplating Bitcoin related products and Vessenes has been working on one. So they reached out to Nefario as a guru on the subject and suggested that they powwow at the StartiPad Seattle offices.

When he tried to pass through customs with only $600 of cash on hand, however, it piqued the suspicions of customs agents who then grilled him on his purpose in visiting the United States and his expected activities.

According to his blog post on the matter, the customs agents treated him civilly, but couldn’t wrap their minds around how he was going to fund his stay with bitcoins,

I was put into a small office when the five to six hours questioning began, did I have a credit card? How come I only had $600? What the hell is bitcoin?

Although I was cash poor I had more than enough bitcoin to cover all the costs of my trip and stay, I was going to be meeting with bitoption later that morning inSeattle, he had $1500 of cash to exchange. I explained this to the agents and then the topic of the questioning turned to how bitcoin worked.

After about an hour of that, they took my iPad and brought back my phone, asked if either of them were locked, and then made copies of what was stored on both. They searched me, and my bags, I was questioned and cross examined on who I would be visiting, what I would be doing, and how I exchange bitcoin for dollars or services, how I got the bitcoins…for hours.

Presumably, Doctor Nefario was turned away because he couldn’t show that he wouldn’t be working in the United States on a visa that doesn’t permit him to. As the customs agents couldn’t understand exactly how he could turn his bitcoins into U.S. currency they would probably testify that he was denied entry because they expected he meant to come into the U.S. to work.

As he qualifies for the “visa waiver” program and he had access to bitcoins—which are currently liquid enough to turn into USD when he wanted—Doctor Nefario didn’t think he would run afoul of being suspected of coming to the U.S. to work. However, $600, no credit cards, and an intent to stay just under two months probably tipped the scales against him.

Right now, Bitcoin is still an emerging virtual currency and technology. Doctor Nefario makes this clear in his in blog post that he understands why he was turned away (although there’s the impression he’s miffed). It’s most likely because U.S. Customs agents have little training in the concept of Bitcoin currency and due to its current obscurity and inaccessibility to them they don’t accept it as a viable currency for someone to pay their way.

Some advice for those who want to travel with bitcoins in their virtual wallet

“Bring enough cash or credit cards to cover the cost of your trip upfront,” he advises, “having bitcoin that you could then exchange while in the U.S. is not something they will accept.” However, he does mention that the customs agents were particularly down on the entire concept and he adds, “Avoid any mention of bitcoin, they don’t like it at all.”

To prevail in the sense of a currency, Bitcoin must first overcome a lack of popular knowledge. With the EFF ditching bitcoins as a form of donation and a lack of retail and common acceptance of the currency by the everyday public work against it.

Doctor Nefario’s experience makes for an odd social experiment in the acceptance of cryptocurrency by foreign governments—but it’s probably going to be years yet before bitcoins are commonplace enough to not raise suspicions when it’s the only currency a traveler has on hand.

 


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