Here is the post, for those who don't want or can't load the page:
PayPal has ceased processing MEGA customer payments effective immediately.
MEGA is aware of a report published by NetNames (partially funded from the MPAA supported Digital Citizens Alliance) that incorrectly claims MEGA's business to not be a legitimate cloud storage service. MEGA is aware that Senator Leahy (Vermont, Chair Senate Judiciary Committee) then pressured Visa and MasterCard to cease providing payment services to the companies named in that report.
Visa and MasterCard then pressured PayPal to cease providing payment services to MEGA.
MEGA provided extensive statistics and other evidence showing that MEGA's business is legitimate and legally compliant. After discussions that appeared to satisfy PayPal’s queries, MEGA authorised PayPal to share that material with Visa and MasterCard. Eventually PayPal made a non-negotiable decision to immediately terminate services to MEGA. PayPal has apologised for this situation and confirmed that MEGA management are upstanding and acting in good faith. PayPal acknowledged that the business is legitimate, but advised that a key concern was that MEGA has a unique model with its end-to-end encryption which leads to “unknowability of what is on the platform”.
MEGA has demonstrated that it is as compliant with its legal obligations as USA cloud storage services operated by Google, Microsoft, Apple, Dropbox, Box, Spideroak etc, but PayPal has advised that MEGA's "unique encryption model" presents an insurmountable difficulty. The encryption models claimed by various USA and other entities apparently do not represent any problem to PayPal or the parties behind PayPal.
MEGA supplies cloud storage services to more than 15 million registered customers in more than 200 countries. MEGA will not compromise its end-to-end user controlled encryption model and is proud to not be part of the USA business network that discriminates against legitimate international businesses.
Until new payment systems are implemented, MEGA will temporarily not enforce its storage limits or suspend any accounts for non-payment and has extended existing subscriptions by 2 months free of charge.
For a country which calls itself, non-ironically, the "land of the free" it is quite disappointing how moneyed US politics and the US justice system is.
It is pretty apparent in this case that a cartel of US companies has some powerful people in their pockets (namely Senators) and those individuals can wield their power to shut down legitimate businesses running abroad.
In this case they will likely wind up shutting down a company, but without even going through any kind of court. Since the last time they spent millions on Megaupload going through courts, and still got nowhere (since their whole case was baseless).
It's not because of end-to-end encryption. It's in response to allegations that MEGA.nz and other "cyberlockers" exist primarily for the purpose of facilitating copyright infringement.
I doubt that this information is reliable, though I suspect it also happens to be true (if you understand my distinction). I have little doubt that mega.nz is mostly used to store pirated content, but I don't think this report is an adequate justification for a U.S. senator to pressure CC companies to block payments.
But I think it is important to emphasize that this is not really about encryption. MEGA.nz would, of course, want us all to think that it is...
> Visa and MasterCard then pressured PayPal to cease providing payment services to MEGA.
Would love to know more about this. Why did two other companies pressure another company? State assisted anti-competition? Missing out on transaction fees?
Why are two of the biggest payment companies pressuring a smaller payment company out of money they decided to step out of?
Is the free market we want to build not really a free or fair market, but one where you are free to destroy the free and fair market for other competitors? If one person pressured another person that would be intimidation yet when that person is a larger corporation it is not seen as being a mafioso bully?
and if we know PayPal, they are still letting the charges go thru, use the money for a couple days and then send the user a in-site only warning about not forwarding it.
Forcing someone to accept payments is the other side of the same coin.
I don't want my government to strongarm credit companies into refusing to process payments for politically troublesome customers. But I also don't want my government to strongarm those same companies into processing those payments.
If anything, this is just a wakeup call that the credit duopoly have more power than we realized.
Kim Dotcom is nothing if not resilient. It is morally and ethically complicated to root for him in every aspect, but I fully expect him to come up with a clever solution to bypass this duopoly in a way that the average user can accept. I don't know if there's any question for which Bitcoin is an unqualified right answer, but this may be as close as I've seen it come.
> Are there no regulatory requirements to force VISA/master card to accept payments as long as the business is not illegal?
There are no such requirements. They are allowed to refuse processing for businesses they deem a high risk for fraud, for instance.
Given Dotcom's past, any business he is running should set off all kind of alarms in the fraud prevention department of the credit card companies.
Often they deal with such a situation by charging higher processing fees, and holding back larger amounts of your money as a reserve to cover refunds and chargebacks if you do turn out to be a fraudulent business, but at the scale Dotcom is trying to operate the credit card companies might feel that this is not enough to protect them.
Are you expecting the same government which shattered original Mega to now force payment providers to serve new Mega? Even if they had the regulatory tools, why would they?
It's a shame we still don't have a cryptocurrency that can be used to route around economic damage caused in situations like this. Bitcoin was the Altair of digital currency. Where's the Apple II?
It's seems that the mega.nz is a one huge app and it's loaded all at once on the first page load. You see that navigating the site and accessing the app itself is really fast without additional load times.
Here's where coinbase could make an interesting feature.
Coinbase QuickPay
A dropdown of popular companies. Select the one you want then enter the amount you want to pay this company in USD. A confirmation screen comes up asking you "Do you really want to pay $X dollars to $COMPANY ?" You select "yes", and from there coinbase does whatever it takes to transfer that value to that company. Completely hiding any concept of bitcoin. Of course, you'd have a QuickPay transaction history screen where you could select "Technical Nerd Details" on a transaction and see all that bitcoin stuff; but initially the transaction history will look just like your bank's transaction history. Showing just the companies, dates, USD amounts. I guess there needs to be some kinda one time email-verification between the merchant, coinbase and costumer at the beginning to prove which payments are coming from who. Coinbase would have to put metadata on the transaction; like maybe a hash of the email address or something that $COMPANY could verify on their side.
Then I guess USgov gets banks to cease processing ACH from coinbase.....
Even if Visa and others would allow this approach, it would still really limit Mega's ability to get funds to the point where its not a viable business I would think.
Chrome's developer tools says "1.9 MB transferred" when loading the MEGA page with cache disabled. On the other hand, it says "7.1 MB transferred" when loading your Pastebin link.
I think bitcoin sucks for a number of important technological and philosophical reasons, but when people ask what its killer features sure: this is one of them. And it's hugely important and hugely needed.
VISA, Mastercard and SWIFT have damaged their own brands by showing themselves not be neutral but controlled politically. By not being neutral, it shows they cannot be trusted and dependable for all users.
Other entities will arise that are neutral around the world and will replace VISA, mastercard and SWIFT.
It doesn't matter that the business is legitimate.
The US Treasury has almost unlimited power to fine or imprison people who move money on the flimsiest of pretexts - and they use it. Look up "Operation Chokehold" for an example but there are many more.
PayPal is attempting to insulate itself from political pressure that can be brought to bear on them in future if they continue to serve Dotcom (and/or their banking partners). Nothing more complex than that. Rule of law does not apply in the banking world.
Interesting they call out other services the USA is okay with that also provide encryption. I believe all the other services the provider can access the data.
> PayPal continues to show how shitty they are. Stop using them!
I really wish I could...
When I created my SaaS a few years back, I went all out with payment providers.
I registered and implemented every single form of online payment I could find. PayPal, AlertPay, PayPay, MoneyBookers, LibertyReserve, Bitcoin. You name it, I made that form of payment available. I even accepted money orders via snail mail.
In the ~2 years I gave all of the "other guys" a chance, 99.9% of my payments came via PayPal.
I received 1 money order. Perhaps 3 people paid via LibertyReserve. 0 payments from all of the other providers mentioned. And over 5,000 payments via PayPal.
Unfortunately, there is no other option if you want to sell stuff online.
And this is coming from one of Bitcoins biggest proponents.
Dunno - Kim Dotcom is a convicted fraudster with a long track record of enabling illegal copying. Paypal are a private company. Why shouldn't they be able to chose not to work with unsavoury clients?
As someone was saying on Twitter, you can legally buy guns in US, but end-to-end encryption is a big no no, because end-to-end encryption is umm...dangerous? It reminds me of another stupid law meant to ban body armor.
[+] [-] aluhut|11 years ago|reply
PayPal has ceased processing MEGA customer payments effective immediately.
MEGA is aware of a report published by NetNames (partially funded from the MPAA supported Digital Citizens Alliance) that incorrectly claims MEGA's business to not be a legitimate cloud storage service. MEGA is aware that Senator Leahy (Vermont, Chair Senate Judiciary Committee) then pressured Visa and MasterCard to cease providing payment services to the companies named in that report.
Visa and MasterCard then pressured PayPal to cease providing payment services to MEGA.
MEGA provided extensive statistics and other evidence showing that MEGA's business is legitimate and legally compliant. After discussions that appeared to satisfy PayPal’s queries, MEGA authorised PayPal to share that material with Visa and MasterCard. Eventually PayPal made a non-negotiable decision to immediately terminate services to MEGA. PayPal has apologised for this situation and confirmed that MEGA management are upstanding and acting in good faith. PayPal acknowledged that the business is legitimate, but advised that a key concern was that MEGA has a unique model with its end-to-end encryption which leads to “unknowability of what is on the platform”.
MEGA has demonstrated that it is as compliant with its legal obligations as USA cloud storage services operated by Google, Microsoft, Apple, Dropbox, Box, Spideroak etc, but PayPal has advised that MEGA's "unique encryption model" presents an insurmountable difficulty. The encryption models claimed by various USA and other entities apparently do not represent any problem to PayPal or the parties behind PayPal.
MEGA supplies cloud storage services to more than 15 million registered customers in more than 200 countries. MEGA will not compromise its end-to-end user controlled encryption model and is proud to not be part of the USA business network that discriminates against legitimate international businesses.
Until new payment systems are implemented, MEGA will temporarily not enforce its storage limits or suspend any accounts for non-payment and has extended existing subscriptions by 2 months free of charge.
[+] [-] UnoriginalGuy|11 years ago|reply
It is pretty apparent in this case that a cartel of US companies has some powerful people in their pockets (namely Senators) and those individuals can wield their power to shut down legitimate businesses running abroad.
In this case they will likely wind up shutting down a company, but without even going through any kind of court. Since the last time they spent millions on Megaupload going through courts, and still got nowhere (since their whole case was baseless).
[+] [-] pdabbadabba|11 years ago|reply
MasterCard and Visa blocked payments in response to this letter from Senator Leahy: http://www.leahy.senate.gov/download/binder1
The letter cites this report, which concludes that MEGA.nz, among many other services, exists mostly to facilitate copyright infringement: http://www2.itif.org/2014-netnames-profitability.pdf
I doubt that this information is reliable, though I suspect it also happens to be true (if you understand my distinction). I have little doubt that mega.nz is mostly used to store pirated content, but I don't think this report is an adequate justification for a U.S. senator to pressure CC companies to block payments.
But I think it is important to emphasize that this is not really about encryption. MEGA.nz would, of course, want us all to think that it is...
[+] [-] drawkbox|11 years ago|reply
Would love to know more about this. Why did two other companies pressure another company? State assisted anti-competition? Missing out on transaction fees?
Why are two of the biggest payment companies pressuring a smaller payment company out of money they decided to step out of?
Is the free market we want to build not really a free or fair market, but one where you are free to destroy the free and fair market for other competitors? If one person pressured another person that would be intimidation yet when that person is a larger corporation it is not seen as being a mafioso bully?
[+] [-] gcb0|11 years ago|reply
[+] [-] sschueller|11 years ago|reply
Are there no regulatory requirements to force VISA/master card to accept payments as long as the business is not illegal?
Does anyone remember when donations to Wiki leaks got frozen?
[+] [-] nathanb|11 years ago|reply
I don't want my government to strongarm credit companies into refusing to process payments for politically troublesome customers. But I also don't want my government to strongarm those same companies into processing those payments.
If anything, this is just a wakeup call that the credit duopoly have more power than we realized.
Kim Dotcom is nothing if not resilient. It is morally and ethically complicated to root for him in every aspect, but I fully expect him to come up with a clever solution to bypass this duopoly in a way that the average user can accept. I don't know if there's any question for which Bitcoin is an unqualified right answer, but this may be as close as I've seen it come.
[+] [-] tzs|11 years ago|reply
There are no such requirements. They are allowed to refuse processing for businesses they deem a high risk for fraud, for instance.
Given Dotcom's past, any business he is running should set off all kind of alarms in the fraud prevention department of the credit card companies.
Often they deal with such a situation by charging higher processing fees, and holding back larger amounts of your money as a reserve to cover refunds and chargebacks if you do turn out to be a fraudulent business, but at the scale Dotcom is trying to operate the credit card companies might feel that this is not enough to protect them.
[+] [-] blfr|11 years ago|reply
[+] [-] CamperBob2|11 years ago|reply
[+] [-] artursapek|11 years ago|reply
[+] [-] Gracana|11 years ago|reply
Those are some pretty wild numbers.
[+] [-] Geee|11 years ago|reply
[+] [-] TillE|11 years ago|reply
[+] [-] gygygy|11 years ago|reply
[+] [-] smtddr|11 years ago|reply
Coinbase QuickPay
A dropdown of popular companies. Select the one you want then enter the amount you want to pay this company in USD. A confirmation screen comes up asking you "Do you really want to pay $X dollars to $COMPANY ?" You select "yes", and from there coinbase does whatever it takes to transfer that value to that company. Completely hiding any concept of bitcoin. Of course, you'd have a QuickPay transaction history screen where you could select "Technical Nerd Details" on a transaction and see all that bitcoin stuff; but initially the transaction history will look just like your bank's transaction history. Showing just the companies, dates, USD amounts. I guess there needs to be some kinda one time email-verification between the merchant, coinbase and costumer at the beginning to prove which payments are coming from who. Coinbase would have to put metadata on the transaction; like maybe a hash of the email address or something that $COMPANY could verify on their side.
Then I guess USgov gets banks to cease processing ACH from coinbase.....
[+] [-] nathangrant|11 years ago|reply
[+] [-] mysteriouswasp|11 years ago|reply
[+] [-] Huselp|11 years ago|reply
[+] [-] Joona|11 years ago|reply
Edit: Ask HN: Paypal alternatives for vendors outside the US? https://news.ycombinator.com/item?id=9123336
[+] [-] RexRollman|11 years ago|reply
[+] [-] mike_hearn|11 years ago|reply
https://torrentfreak.com/mastercard-and-visa-start-banning-v...
[+] [-] falcolas|11 years ago|reply
> a key concern was that MEGA has a unique model with its end-to-end encryption which leads to “unknowability of what is on the platform
It's not outside the realm of possibility.
[+] [-] owly|11 years ago|reply
[+] [-] Buge|11 years ago|reply
[+] [-] jMyles|11 years ago|reply
[+] [-] poopsmithe|11 years ago|reply
[+] [-] simonblack|11 years ago|reply
Other entities will arise that are neutral around the world and will replace VISA, mastercard and SWIFT.
[+] [-] MBCook|11 years ago|reply
Do you honestly think anyone outside HN and other very tech heavy crowds knows about this? Do you think they'd care?
If this has done anything (and I kind of doubt it) I would say it's helped them politicaly a little tiny bit.
[+] [-] mkramlich|11 years ago|reply
[+] [-] beshrkayali|11 years ago|reply
[+] [-] mike_hearn|11 years ago|reply
The US Treasury has almost unlimited power to fine or imprison people who move money on the flimsiest of pretexts - and they use it. Look up "Operation Chokehold" for an example but there are many more.
PayPal is attempting to insulate itself from political pressure that can be brought to bear on them in future if they continue to serve Dotcom (and/or their banking partners). Nothing more complex than that. Rule of law does not apply in the banking world.
[+] [-] sbarre|11 years ago|reply
[+] [-] howeyc|11 years ago|reply
Except maybe SpiderOak.
[+] [-] ryan-c|11 years ago|reply
[+] [-] driverdan|11 years ago|reply
To people who work there, why? How can you continue to work for an organization that does things like this?
[+] [-] GigabyteCoin|11 years ago|reply
I really wish I could...
When I created my SaaS a few years back, I went all out with payment providers.
I registered and implemented every single form of online payment I could find. PayPal, AlertPay, PayPay, MoneyBookers, LibertyReserve, Bitcoin. You name it, I made that form of payment available. I even accepted money orders via snail mail.
In the ~2 years I gave all of the "other guys" a chance, 99.9% of my payments came via PayPal.
I received 1 money order. Perhaps 3 people paid via LibertyReserve. 0 payments from all of the other providers mentioned. And over 5,000 payments via PayPal.
Unfortunately, there is no other option if you want to sell stuff online.
And this is coming from one of Bitcoins biggest proponents.
[+] [-] tim333|11 years ago|reply
[+] [-] fnordfnordfnord|11 years ago|reply
[+] [-] venomsnake|11 years ago|reply
[+] [-] junto|11 years ago|reply
[+] [-] xacaxulu|11 years ago|reply
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[+] [-] unknown|11 years ago|reply
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[+] [-] higherpurpose|11 years ago|reply
[+] [-] woodman|11 years ago|reply
[+] [-] unknown|11 years ago|reply
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