Eric Hughes says:
If the value transferred is liquid, and the payment is made upon demand, then, in fact, you are a bank, regardless of what else you might call yourself.
Well, there is ONE subtlety -- entities like mutual funds and securities broker/dealers are not considered banks qua banks under American law On the other hand, Fidelity, for example, the largest of the mutual fund providers, does not offer demand deposits, because you can't get back your money "upon demand". They don't have to give it back to you immediately, so it's not "upon demand". Check the agreement or the "checks" you get for your fund account. It seems conceivable to operate a business that took non-demand liquid deposits, but which promptly serviced most demands for withdrawal because of the competitive environment. A "banc" of this form would not survive if the liquid deposits were, practically speaking, liquid. ("Banc" is an avoidance of the regulation which puts companies with the word "bank" in them under banking regulation. It's amazing at the number of companies with names like "Bancshares" or "Banc Holding".) Since no such institution exists now, it would be currently outside the regulatory framework, but one should not expect it to remain that way. Pragmatically speaking, one's best strategy would be to get successful rapidly and then hire lobbyists. Credit card and charge card companies could do this themselves right now, were they to pay interest on positive balances. The contract between card company and customer would have to specify that the positive balance was not available "upon demand", per above. Otherwise most of the relationships could be the same. As an aside, issues of commercial paper, including promissory notes and hypothetically digital "bancnotes", whose term is nine months or less are specifically exempted from SEC regulation. There really seems to be a gap in the regulatory environment. Legal hacking is a lot of fun. Prerequisites are a humility to learn the structure of legal argument and access to legal materials. The study guides for law students are generally excellent introductions to the subject. Access to a law library is also useful for looking up statute and decisions, but not essential, although reading at least a few decisions is necessary for ensuring an understanding of the social process involved in the creation of law. And if what you want to accomplish with your computer hacking requires, for implementation, something outside the computer hardware and networks, legal hacking is almost a necessity. Eric