You are missing the point, the article is telling you exactly what currency is. It is something that circulates from hand to hand as a medium of exchange. Blacks goes farther and defines LEGAL CURRENCY as CURRENCY, hence the addition of the requirement of it being coined by the MINT or issued by the Fed and recognised by law.

I repeat, legally, all over the world, currency is a means of exchange that is accepted for payment for goods and services. This is what Bitcoin does.

I am being respectful and trying to keep a civil tone, I would very much appreciate if you did the same.


Black's? Really? You do know that Black's is simply used for basic definitions, right? It is mostly used in law school. I don't even know where my copy is! If I remember my days from law school correctly, he may even have used Bouvier's own outdated definition of currency as "The money which passes, at a fixed value, from hand to hand; money which is authorized by law."  

Nowadays currency is recognised as a generally accepted exchange of value, this arises from Friedman and Schwartz famous paper, "The Definition of Money: Net Wealth and Neutrality as Criteria Journal of Money", Credit and Banking, Vol. 1, No. 1, Feb., 1969. I would also refer you to this definition in Ellinger, Lomicka and Hooley's "Modern Banking Law", Oxford Univeristy Press, 2002, p.362.


They can be used legally as proof of intent. Bitcoin calls itself a P2P currency, it fulfils the actions of money, namely, it is value exchanged by parties other than the issuer for goods and services.


Please, could you leave the snarky ad homs? You really want to use the intangible explanation? Really? By that argument, there is no such thing as an EFTPOS because you cannot point to a thing being transferred. There are no funds transfers from bank accounts because no physical bills and coins are being exchanged.


Interest? Legally interest is nothing more than a payment on balances maintained in an account. Can you please explain how the entire system of interest works on Bitcoin? Who holds the balance? Who pays out the interest? How is it calculated?

You will have to show me that you have a legal definition of currency that is different from what Bitcoin does. It acts like a currency, it advertises itself as a currency, ergo it is a currency.

A legal definition of currency is a generally accepted medium of exchange for goods and services. Most legal definitions require that a currency must be accepted as means of payment by a party other than the issuer.

Bitcoin fits this definition. Moreover, it advertises itself as a currency.


Bitcoins may not be defined as a "currency" or a "commodity". They may reside in a legally "grey" area for many years to come. When something is "grey", nobody is right or wrong, completely.

I am lawyer   They are certainly a currency in my view, but not a commodity or a security.


This is often not true, you would be surprised of how many laws apply neatly to most Internet phenomena. In fact, there have been very few instances that I have seen something online that truly does not fit an existing legal category. Phishing was initially in a bit of a grey area in some countries, but in Common Law systems it fell under common law fraud. Non-commercial file-sharing was also briefly in a bit of a grey area in some countries (particularly in Europe), but this was later plugged.

Bitcoin in my opinion is clearly a currency, and if it is, then it is illegal.

Agreed. There are more than enough laws that declare all currencies not issued by the authorised issuer as illegal. To give an example of the law where I am:

"Only the Central Bank will have the exclusive right to issue banknotes and currencies in the country. Neither the state nor any other person or entity, may issue notes, coins or other documents or certificates that can circulate as money."

The law then imposes civil and criminal sanctions for breaking the law. The same applies to the creation of new currencies everywhere in the world.

There are laws against possession of drugs, so a court will not be interested in hearing a case to remedy a loss of them.



Not specifically against Bitcoin, but against all unofficial currencies.

In the United States they are almost certainly illegal, as only the Mint and the Fed can issue currency. The FBI stated this about the Liberty Dollar affair: “It is a violation of federal law for individuals, or organizations, to create private coin or currency systems to compete with the official coinage and currency of the United States.”

In Europe they are certainly illegal, as only Electronic Money Institutions can issue electronic currency in accordance to the EMI Directive.

In most other countries, including where I am right now, the issuing of currency is monopolised by government or central banks.

Mt.Gox is based in Japan, I am not familiar with Japanese law, but I would be very surprised if they have the same version of class action lawsuits as the U.S. system.


I've looked into this (warning, I'm no commodities lawyer). Commodities have one legal requirement, they need to have inherent value. What is the inherent value of bitcoins?

They do, sorry, but I'm a lawyer.


And these were not theft cases, they were hacking cases. Two very different things.

Not every coutry is covered by common law. On the contrary, most countries in the world fall under civil law systems, where the law is strictly codified. So first you have to determine jurisdiction. Mt.gox is in Japan (not a Common Law country). Moreover, common law is not unlimited, you have to establish either the existence of a tort (or delict, depending on jurisdiction), or the existence of common law fraud. I cannot think of any circumstance in which these would apply to this case.


Theft has a very clear definition in law. Generally, you cannot steal intangible goods. In the case of currency, there is indeed theft of legal currency, even in electronic format. However, BTCs are operating in a legal void, not only that, they may even be illegal in the eyes of the law. So you cannot steal illegal items.


What is this online trial crap? Really, you can scream and write as many angry posts as you want, that will not get the coins back.

These are mostly not considered theft, but hacking. E.g. lots of countries have signed up to the Cybercrime Convention, which criminalises unauthorised access to an account.

Theft of virtual currencies are entirely a different matter, AFAIK, only Korea has come remotely close to recognise it as theft.


Criminal law doesn't work like that, vlaue is not the only way to determine criminality. People pay for drugs all the time, they have value, but you cannot go to court to have your busted drug deal enforced. Bitcoins could be illegal, so you could not even argue this in court.


You have to distinguish between civil and criminal law. I do not see any sort of legal action against Kevin, he just placed an order. Prosecutors could pursue the original hacker though.

This Kevin person is not the hacker, he just placed an order. You are confusing two different things.

The original hacker surely could go to jail under hacking criminal offences though.

What contracts would those be? I could make a strong legal argument that there is no contract involved at all. Mtgox doesn't have a click-wrap agreement when signing up, the site has no Terms and Conditions, and you cannot contract with illegal goods or services. For example, in countries where prostitution is illegal you cannot go to the police if the prostitute did not fulfil her part of the deal


Moral liability? Sure! Legal liability? Afraid not. One drawback of operating in the libertarian utopia is that at the moment the law does not apply to Bitcoins.

There cannot be a felony unless you can prove that there was theft. As BTCs have no legal status, they are unregulated and therefore not subject to theft. The best you could get away with is to claim hacking laws (e.g. Convention on Cybercrime).

There is a good argument to be made that BTCs are illegal in several countries, so good luck trying to get law enforcement involved.

I did not say that I was afraid of Bitcoins, I said that my friend was concerned that it might prompt an audit if a lot of money came into my accounts. I thought I might be able to hide it well enough so that would not happen. The point is moot as I will not be investing any time soon, but not because of the tax implications. Mining is on the verge of not being profitable, and at the moment it is not possible to trust the exchanges.


Number 3 is a very big IF. At the moment, I cannot see how any sane merchant will get involved. Imagine you took payment on Saturday afternoon at $17 USD as a weekly average. Today you would be in a panic.

I still think that the legality of BTC is a huge issue. If it becomes more popular, the Fed and European regulators will declare it illegal. Catch 22.

He had a point if BTCs are illegal. I disagree as I could declare it as investment in securities, but as BTCs are not really securities and commodities either, this could leave me open to an audit. In fact, the legal status of BTCs is very blurry territory.


Only if you can trust the exchanges, and at the moment, you can't. On top of all of the other risks involved, I'mn sitting this one out. I'm still really interested in Bitcoin from a professional standpoint.


This is an open forum, people are free to reply to stuff, that how Internet forums work 

He was nervous that it could have negative impact with regulators for tax purposes if BTCs were declared illegal. His argument was that you don't get taxed if you profit from drugs, you go to jail I didn't buy this argument, and was still willing to invest a small amount for a laugh and to see if there was anything in Bitcoins because I'm very interested in it from a professional perspective (I'm a lawyer specialising in electronic commerce).

That is a big if. This is going to create a lot of bad press, so people will just not think it is worth it, and will not risk getting involved. You need more merchants and more non-technical people to adopt for this to work, and I cannot see anyone entering the market now. So at least for a while the hopes of a growing economy are dashed.

Sorry, a block. BTCs come in blocks when mined, each block consists of 50 BTCs. The more blocks are mined, the more difficult it is to mine new ones. At current levels, and for you going on your own with a normal setup, you will need just under 2 years to mine a new block on your own. So you will have to pool.


If you're doing this on your own, yes, that's it. In 400 days or so you will have 50 BTCs 

Do you really think people in the wider community will invest any money in this? I was sort of thinking of investing about $1000 USD for a laugh if the price dropped under $8 USD (I can afford that and more). Just yesterday I had a talk with a day trader friend of mine, and he warned me that any profits coming from BTC would look bad from a tax perspective, and really warned me to stay out of this, but I told him I would be careful.

Now I would not touch BTCs with a bargepole.

Really? I would be extremely surprised how that would go. The legal status of Bitcoins is grey to say the least. Bitcoins are at best an unregulated speculative market, at worst they are an illegal currency. You cannot sue for the theft of something that is illegal; try suing a drug dealer because they gave you flour instead of cocaine

So, imagine a person had some bitcoins that were traded without their authorisation. What can they do? First we would have to look if there is a contract between the user and mt.gox, but there is no such thing, when signing up users were not given any terms and conditions through a click-wrap agreement, and the site has no ToC either. So any user would only have one recourse, and that is to hope that a court may recognise that Mt.Gox had some obligation to you, and that they were neglectful in their fulfilment of such obligation. This will be difficult to say the least without a contract.

So, even if you want to go ahead and sue, where would you do it? You could sue in your own jurisdiction, but foreign civil lawsuits are difficult to enforce, and we have established that BTCs may even be illegal in your jurisdiction. You could try suing in Japan, but for that you would need to hire a Japanese lawyer... not cheap. And then again, BTCs may be illegal in Japan too.

So, I don't really see any lawsuits happening any time soon.