TLDR: Old school money transmitters like Western Union lobbied to get a bill passed in CA that requires domestic money transmitters to get licensed (previously was international transmitters only). Now costs $500,000+ (just in CA, not including the 43+ other states with similar licensing requirements), full background checks, and possibility of jail under the PATRIOT Act if you violate any parts of the licensing.
It's a bank that stores gold, not cash, and issues a debit card that draws on it. But even that is apparently borderline illegal enough in the US that he won't even show the website to US citizens.
I imagine Tradehill could have done something similar, and may have had they not also had $100,000 taken from them.
They did. They worked out of Vina del Mar, where I lived for 6 months during my stint at Start-Up Chile.
The TH guys are a good group, really smart, and doing progressive things. It's unfortunate that they keep getting screwed by the payment processors, who themselves have acted shadier than TH ever did. cough Dwolla coughhttp://tradehillblog.com/2011/07/26/why-we-are-no-longer-acc...
https://bitcointalk.org/index.php?topic=63749.msg746954#msg7...
Aaron Greenspan predicted this last summer:
http://www.quora.com/Aaron-Greenspan/Posts/In-Fifty-Days-Pay...
TLDR: Old school money transmitters like Western Union lobbied to get a bill passed in CA that requires domestic money transmitters to get licensed (previously was international transmitters only). Now costs $500,000+ (just in CA, not including the 43+ other states with similar licensing requirements), full background checks, and possibility of jail under the PATRIOT Act if you violate any parts of the licensing.