money laundering with virtual currency -

[oberon Zuta]

If we read this article we can maybe understand the background of changing ToS and close TPE's as fast LL did....

 

Liberty Reserve closed (Reuters)

[Jewel Laurasia]

"The U.S. Treasury Department's anti-money laundering unit, the Financial Crimes Enforcement Network (FinCEN), issued guidance in March that labeled digital currency firms as money transmitters, thereby obliging them to put in place anti-money laundering programs and register with FinCEN."

 

Is that what LL had to do?

[Dillon Levenque]

Yes, it was. That is what drove the whole TPE flap. LL wanted to be allowed to continue doing business in the country they call home.

ETA: While it caused a great deal of frustration and aggravation for users outside the USA, a lot of that was repaired within a few days by agreements allowing several TPE's to sell Lindens. Far as I know only Lindex is currently permitted to cash out Lindens (exchange them for USD) and their slow cashout process bugs a lot of people. There is at least the suggestion that some of the TPE's might qualify and register with FinCEN so even that might improve.