UPDATED 22:23 EDT / NOVEMBER 10 2014

Robocoin kills anonymity with KYC/AML software in its ATMs

small__10680057786Bit by bit, Bitcoin is slowly becoming more mainstream, and though is a dream come true for many enthusiasts, in reality it could quickly become a nightmare.

You see, as more businesses starts accepting Bitcoin transactions, they are obliged to follow government rules such as implementing Know Your Customer (KYC) and Anti-Money Laundering (AML) to avoid being used for money laundering or other illegal activities that would jeopardize their business. The problem is that the people who started Bitcoin wanted a way for people to purchase things and services without having to give up their identity. As businesses comply with KYC regulations, customers are obliged to reveal their identity, something that goes against the core nature of Bitcoin.

One example of this is Robocoin Technologies LLC, a company that makes and distributes Bitcoin ATMs. Recently, it announced plans to implement KYC and AML software and hardware with its ATMs as part of a new effort to comply with the Financial Crimes Enforcement Network (FinCen). Simply put, Robocoin will no longer facilitate anonymous transactions.

In a blog post, Robocoin justified its move by saying non-KYC ATMs from its competitors have been seized by the authorities, or used for shady transactions, thus the company is not willing to risk its business by continuing to offer a choice of KYC and non-KYC to its operators.

“Robocoin remains one of Bitcoin’s leaders in AML / KYC compliance and thankfully our entire network has avoided removal or seizure. Still, events like this represent legitimate warnings. Now, beyond these warning signs, our legal council is warning that FinCen is going to begin making examples out of non-compliant Bitcoin companies.”

Robocoin 2.0 will require “KYC compliance and removing outside dependencies including wallet uptime, exchange uptime, paper redemption tickets, mobile wallet unreliability, lost paper wallets, and others.”

For those that do not want to operate Robocoin ATMs with KYC/AML implemented, the company is offering to resell their machines.

A lively thread on Reddit has since emerged, discussing Robocoin’s plans. Some are in support of the change as it would allow Bitcoin to flourish, while others believe that the change goes against the core principle of Bitcoin, which is anonymity.

One Robocoin operator posted his rant on the thread and is asking for other operators to boycott using the machine as a form of rebellion, but another Redditor, altoidaddict, decided to edit the rant which may or may have made more sense, depending on who you want to believe.

DEAR ROBOCOIN OPERATOR JORDAN KELLY IS TRYING TO FUCK YOU

( Hey everyone, pay attention to me. I’m going to blow this out of proportion and use all caps to show you how important I am. )

Dear robocoin Operator. Like me you paid alot of money for Robocoin machine and it is YOURS.

( I’m going to state the obvious and make you paranoid that someone is going to take your toys away. FUD. )

Today Jordan Kelly CEO of robocoin is threatening us

( A few months ago an update to the software was announced. It was announced again. Then when it was released an open call to convert was had. After a month or so a deadline was set. When the deadline arrived a final notice went out. How dare they threaten me like that!? )

all saying he will convert our machine into a login terminal for Jordans own centralised. proprietary, closed source, web based system. This benefits him and his company as it steals YOUR CUSTOMERS and gives him more centralised power.

( All of the complaining customers did about how horrible the system was resulted in changes to improve the things that needed help. The new system works similar to the old system , you can still set your buy and sell vig. but you don’t have to wait for transactions to clear exchanges or suffer when network connections fail or exchanges go down. So you still make money, the customers get a faster and better experience, and many of the problems I complained about have been fixed. I don’t like this. )

This is not in the spirit of bitcoin’s decentralised freedom loving roots. We as robocoin operators need to unite together and install open source software on our machines and cut Jordan out and his fees out.

( I won’t mention the fees I charge, because that would tarnish my freedom loving roots. The spirit of me making money is the one true freedom I cherish and I don’t like having to comply with laws. So what if robocoin decided to give in and comply. I don’t want to so they can’t because I say so and robocoin has to do what I want them to do or I’ll hold my breath until I turn blue on reddit )

I have spoken with who run free open source software on their machines. https://github.com/Lamassu/ It is possible to buy a separate PC that you can run alongside the PC that comes in the safe. You can then just reconnect the webcam and validator to this new PC and run the machine as a giant Lamassu.

( I took the advice Jordan gave me in the email that he sent after I refused to convert to the new software. He said that if I don’t want to comply I could go talk to Lamassu, and gave me a link and an email to them. How dare he! )

This software may need tweaking to get it working with the cash acceptor that comes in the robocoin. Cash Acceptor MEI 252704022P1 Here’s the robocoin manual:https://drive.google.com/file/d/0BxGOMhsnKhZxekp6eEFKOUdTLVk/view?usp=sharing This is a call for help to the open source and bitcoin community to come together and make these bitcoin ATMs what they should be. Free and open.

( I am technically inept and can’t do any of this myself so I need someone to do it for me like I needed robocoin to do everything for me. If it doesn’t work the way I want it to, I’ll make another reddit cry and I will keep doing that until someone makes it work for me because I don’t know an IP address from a zip code. )

I will be turning off my 4 robocoin machines until either Jordan backs down on this and commits to supporting version 1 software as he said he would or we have the machines mnning on the lammgssu software.

( I was told that if I did not allow robocoin to convert my systems to the new software, they would invoke the clause in the contract I signed that states that they can terminate my service if I don’t upgrade to their new software. Then on the night of the deadline they terminated my service! Well I’m going to turn my machines off in protest! That will show them! There’s another clause that says they own the software and can update it at any time, without warning but they gave me months of notice instead! How dare they! How dare they expect me to honor a contract I signed! I want a do-over! Lots of companies decide to support their end of life software forever for free! Why can’t robocoin? )

I suggest we all turn off our machines together to show we won’t be bullied into his new system.

( I am going to try to bully them into reviving end of life software and accuse them of bullying people to make them look bad. I’m clever! I bet lots of people will turn off their machines and stop making money to support me. I can be the next Che` and get my face on a t-shirt! )

Please show your support for this project either by replying or adding your voice to the reddit post where I have posted this letter.

( Please talk about this on reddit so I can look important and cutting edge, and perhaps even fuel the fire that people with legitimate complaints had and ride on their bandwagon. I can be one of the cool kids! )

Regards @jonnybitcoin

( I am so full of shit I cry brown tears )

photo credit: btckeychain via photopin cc

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