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Blocking
Pennsylvania Act 7 of 2025 — does distributing pool-mined rewards for a pool fee require a licence?
Question. Under section 2(a)(2) of the Money Transmission and Virtual Currency Transmission Business Licensing Law (effective 26 August 2025), does a Pennsylvania operator that receives block rewards its pool mined and distributes each miner's share to a miner-supplied address, retaining a 1% pool fee, "engage in the business of transmitting virtual currency by means of a transmittal instrument for a fee or other consideration with or on behalf of an individual"? Does the section 2(b)(2) self-hosted-wallet carve-out, with its proviso for transmission "as part of a third-party service on behalf of another individual in exchange for a fee", help or hurt?
Why it matters. The statute has no mining, mining-pool, or integral-services exemption. Licensing requires audited net worth of at least $500,000, a $1,000,000 surety bond, and an NMLS application. The Department of Banking and Securities has said it does not provide licensing determinations and there is no grace period.
Source. 7 P.S. § 6101 et seq. as amended by Act 7 of 2025 (SB 202); DoBS letter of 12 August 2025; PA Bulletin 55-32 rescinding the prior Virtual Currency Statement of Policy.
Design currently assumes. That the pool distributes rewards it earned rather than transmitting value received from one person to another; that the fee compensates mining infrastructure rather than transmission; and that a Pennsylvania attorney familiar with cryptocurrency and money-transmitter law must confirm or reject that reading before the pool opens.
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Blocking
FinCEN FIN-2019-G001 §5.4 — where is the line between a pending reward and a hosted account?
Question. Given that the guidance treats a pool's distribution of rewards as integral to the mining service but warns that hosting wallets for members creates account-based money transmission, is the proposed ledger — a fixed 1 SPMTC threshold, a daily payout run, a 30-day inactive sweep, no miner-adjustable settings — sufficiently far from a hosted account? Is there a maximum hold time counsel would set? Would any miner-configurable setting (threshold, schedule, pause) change the answer?
Why it matters. The ledger is unavoidable — shares cannot each be paid individually — but it is the only place the operator holds an allocation for a miner, even briefly. FinCEN's hosted-wallet criteria (who owns the value, where it is stored, whether the owner interacts with the network directly, whether the intermediary has independent control) all bear on it.
Source. FIN-2019-G001 §§ 4.2, 4.2.1, 5.4; 31 CFR 1010.100(ff)(5)(ii)(F); FinCEN's statement that it interprets the exemptions strictly.
Design currently assumes. A short, mechanical, non-configurable hold is consistent with the fact pattern in §5.4. Nothing miner-adjustable is built.
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Blocking
OFAC — blocking, reporting, VPNs, and Stratum
Question. If a payout address matches an SDN-listed digital-currency address, must the allocation be blocked as blocked property and reported, and within what time? What is the correct posture towards VPN and proxy traffic that defeats country-level IP screening? Is IP blocking required at the Stratum port as well as the website? What record-retention period applies to screening decisions?
Why it matters. The operator is a U.S. person and strict liability applies regardless of server location. Withholding a payout is the single case where the service deliberately retains value, so the mechanics must be right before the code path exists.
Source. OFAC Sanctions Compliance Guidance for the Virtual Currency Industry (October 2021); OFAC FAQ 559; current programme list (Cuba, Iran, North Korea, Crimea/DNR/LNR; Syria programme revoked 2025).
Design currently assumes. Country-level IP gate on web and Stratum; SDN address screening at first sight and before each run; withholding only on match or lawful order; five-year retention of decisions; no name screening because no names are collected.
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Before launch
Tax reporting on payouts to U.S. miners
Question. Does the final 1099-DA broker regulation (TD 10000) exclude a pool operator as a person solely providing validation services — to be verified on a primary IRS source, not secondary commentary? Independently of 1099-DA, does the operator have Form 1099-MISC or 1099-NEC obligations for payouts to U.S. miners above the reporting threshold, and if so, what does that imply for a service that collects no names, TINs, W-9s, or W-8s?
Why it matters. A reporting obligation that requires identity collection would change the no-KYC onboarding model and the privacy policy.
Source. TD 10000 (June 2024); IRS newsroom guidance on non-custodial brokers; 26 U.S.C. § 6041 and § 6045.
Design currently assumes. No information returns are filed and no tax identity is collected. This is an assumption, not a conclusion, and needs a CPA as well as counsel.
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Before launch
SEC staff statement scope — is PPLNS with a 1% fee "administrative or ministerial"?
Question. The Division of Corporation Finance's statement of 20 March 2025 describes mining-pool operator activity on proof-of-work networks as primarily administrative or ministerial, with the caveat that different compensation or participation arrangements could change the view. Does the proposed PPLNS methodology, the fee, the notification service, and the site's copy stay inside that description?
Why it matters. It is a staff statement, not a rule, and the caveat is explicit. Any drift towards operator-produced returns (PPS floors, bonuses, referral rewards) would leave the statement's fact pattern.
Source. SEC Division of Corporation Finance, "Statement on Certain Proof-of-Work Mining Activities", 20 March 2025.
Design currently assumes. Yes; PPS and every operator-funded reward were omitted for this reason.
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Before launch
Consumer protection — Terms formation and enforceability
Question. Are Terms accepted by use — connecting a miner to the Stratum endpoint, with no click-through — enforceable against miners in Pennsylvania and generally? Are the limitation-of-liability, disclaimer, dispute-resolution, and arbitration clauses in the draft Terms appropriate for a service with no account and no signature? Do any automatic-renewal, unfair-practice, or plain-language statutes apply?
Why it matters. The address-is-identity model removes the usual moment of acceptance. If a click-through is required, the onboarding workflow changes.
Source. Draft Terms of Service; Pennsylvania Unfair Trade Practices and Consumer Protection Law.
Design currently assumes. Terms by use, with the full text linked from the mining page and the Stratum motd, is sufficient.
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Before launch
Abandoned property and unpayable rewards
Question. Allocations below the network dust limit cannot be paid by the network's own rules. Do Pennsylvania's or any other state's unclaimed-property laws reach these amounts, and does the 30-day inactive sweep for amounts above dust satisfy or complicate that analysis?
Why it matters. Unpayable residue is small per address but accumulates across all addresses ever seen.
Source. 72 P.S. § 1301.1 et seq. (Pennsylvania Disposition of Abandoned and Unclaimed Property Act); network dust rules inherited from Bitcoin Core.
Design currently assumes. Dust residue is disclosed in the payout policy and retained by the pool as unpayable; counsel to confirm treatment.
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Before launch
Privacy — state laws, GDPR, and law-enforcement requests
Question. Does the data actually collected (IP country, payout address, optional email, share records) trigger any U.S. state privacy statute? For miners in the EU or UK, does the service process personal data such that GDPR or UK GDPR applies, and if so what is the lawful basis and who is the representative? What is the policy for responding to law-enforcement or civil requests for share records or payout history by address?
Why it matters. The privacy policy must describe what actually happens. A request policy must exist before the first request.
Source. Draft Privacy Policy; recordkeeping document.
Design currently assumes. Minimal collection keeps the service below most thresholds; every request is logged and routed to counsel.
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Advisable
Entity, insurance, and registered agent
Question. Which legal entity operates Spearmint Mining, in what form, and at what registered address? Is the network direction (Spearmint) held by the same entity as the mining service (Spearmint Mining), and should they be separated? What insurance, if any, is appropriate?
Why it matters. The legal pages carry a placeholder for the entity name. The separation between network and service that the site draws in words should exist in corporate form if counsel thinks it should.
Source. Every legal page; compliance page.
Design currently assumes. Instant Access operates both; the placeholder is filled before the Terms take effect.
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Advisable
Marketing review of the site
Question. Does any page — including the economic policy's supply schedule, the 8% disclosure, and the estimated-reward tile on the dashboard — describe SPMTC in a way that could be read as promoting purchase in expectation of appreciation or as promising a return?
Why it matters. The site deliberately avoids price, appreciation, and return language, but a reviewer other than the authors should confirm it.
Source. SEC staff statement (March 2025); general securities-marketing principles.
Design currently assumes. The site passes; the estimated-reward tile is labelled an estimate and not a promise.
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Advisable
The 8% pre-launch acquisition
Question. The team mines 8% of supply at the ordinary block reward before public launch, with the block range published and pinned in the first public release. Does that acquisition, or its disclosure, raise any securities, disclosure, or tax issue for the operator?
Why it matters. It is the only allocation that is not open to the public and it is disclosed on the homepage.
Source. FIN-2014-R001 (a person mining for its own account); economic policy.
Design currently assumes. Mining for one's own account with full disclosure is the cleanest form of pre-launch allocation available.
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Advisable
Support scope — could answering "which address" questions be advice?
Question. Support will tell a miner that the payout address must be a Spearmint address they control and must not be an exchange address. Is there any framing in which explaining how to obtain or choose an address becomes financial or custodial advice, and what script keeps it operational?
Why it matters. Support is the one human channel and the easiest place for scope to drift.
Source. Support page.
Design currently assumes. Operational explanation only; no wallet recommendations; scripted refusals for anything else.
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Advisable
FinCEN MSB registration as a precaution — a question, not a recommendation
Question. Some operators register with FinCEN as a money services business even where they believe registration is not required. What are the consequences, in counsel's view, of registering when not required (programme obligations, examination exposure, implied characterisation) versus not registering and being wrong?
Why it matters. The decision shapes the compliance programme either way and cannot be made by the operator alone.
Source. 31 CFR 1022.380; FIN-2019-G001.
Design currently assumes. Nothing. The question is put to counsel without a preferred answer.
— Status
| # | Question | Status | Counsel | Date |
|---|---|---|---|---|
| 1 | Pennsylvania Act 7 of 2025 | Open | — | — |
| 2 | FinCEN §5.4 — pending-reward hold | Open | — | — |
| 3 | OFAC mechanics | Open | — | — |
| 4 | Tax reporting | Open | — | — |
| 5 | SEC staff statement scope | Open | — | — |
| 6 | Terms formation and enforceability | Open | — | — |
| 7 | Abandoned property | Open | — | — |
| 8 | Privacy and requests | Open | — | — |
| 9 | Entity, insurance, agent | Open | — | — |
| 10 | Marketing review | Open | — | — |
| 11 | 8% acquisition | Open | — | — |
| 12 | Support scope | Open | — | — |
| 13 | MSB registration question | Open | — | — |
When an item is resolved, the outcome, counsel, and date are recorded here and the corresponding row on the matrix is updated in the same change. Resolved items stay on the page.