Quote from: kmfkewm on April 13, 2012, 11:49 amQuote from: nugz on April 13, 2012, 08:18 amI think Wikipedia sums it up quite nicely, "Money laundering refers to the process of concealing the source of legally and illegally and grey area obtained monies. "So by this definition, nearly everything is money laundering. If I legally sell a pen, and then hide the income from that pen, I am engaging in money laundering according to the above statement.It's another one of those stupid blanket laws that can be arbitrarily applied to ANYONE who doesn't keep good books basicly.Yes. In practice money laundering is essentially anything that involves money that the government has not explicitly approved. Several E-currency exchangers and services have been busted in USA and charged with money laundering, even ones that were apparently taking some efforts to follow the law. You would really need to have solid brass balls to operate a bitcoin exchange in USA unless you get written permission from the government saying that you are allowed to do so (probably in the form of some license) + keep detailed records on each of your customers + fully comply with suspicious activity reporting laws etc etc etc.One of the many legal uses for Bitcoin is to send money abroad. I do this for someone close to me who lives in New Zealand (I am English). I use my bank account to buy Bitcoins via Intersango, then move the coins to BitNZ, sell them and withdraw them to my friend's NZ bank account. It is true that there is a layer of deniability to this transaction but it is not illegal in itself.The question of whether the exchange themselves are laundering money comes down to whether their trade constitutes offering a financial service. The IRS in the USA was able to pin this on E-Gold despite the fact the organisation didn't own a bank account. As I said the point is moot in any case as it's possible to set up and run an exchange anonymously, although such exchanges have not enjoyed much success in practice.V.