Is stealing Bitcoins illegal?

[CharlieContent]

If I somehow gain unauthorized access to your wallet.dat, I can be arrested for computer crimes.

But suppose I somehow deceive you into transferring the coins to me yourself.

In the eyes of the law, have I committed a crime?

Personally I think that in most countries, if you reported it to the police, there is nothing they could do. However I am not a lawyer so I am interested to hear what some of the more legally knowledgeable people here think.

I know of one country where I think it would be a crime. South Korea has a "virtual crime" unit, and presumably virtual crime laws. This was set up to prosecute people who steal items and in-game currency in MMORPGs and similar games and I believe that many cases have come to court, although it's not regarded as a particularly serious crime.

There are also two countries where it may be a crime. In Japan a young man was arrested for "virtual mugging" in a game called Lineage 2. A Dutch teenager was also arrested for stealing virtual furniture in a visual chat environment called Habbo Hotel. However I can't find any information as to whether either of these arrests lead to prosecution and conviction. After the Dutch arrest a spokesperson for the company which developed Habbo Hotel said "It is theft because the items were bought with real money." So perhaps in Holland it is only illegal to steal coins which have been purchased and not mined.

What do you all think?

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[bitcoinbear]

Of course stealing bitcoins is illegal.

Taking something that does not belong to you by force or by fraud is one of the things governments were put in place to stop.

[CharlieContent]

Of course stealing bitcoins is illegal.

Which jurisdiction are you referring to?  Can you reference a law, statute or decision that can back up this assertion?

You seem very sure, but I am quite sure that it is a far more complicated matter than your answer suggests.

In China, Qiu Chengwei was sentenced to life in prison after stabbing and killing fellow The Legend of Mir 3 gamer Zhu Caoyuan. In the game Qiu had lent Zhu a powerful sword (a "dragon sabre"), which Zhu then went on to sell on eBay for 7,200 Yuan (about £473 or US$870). With no Chinese laws covering the online dispute, there was nothing the police could do.

The sword is a virtual item, created out of nothingness, which trades for a significant sum on the open market. Even though the item was worth a lot of money, the theft and subsequent sale was not an illegal act.  Is a Bitcoin really substantially different in the eyes of the law?

[Puppet]

I suspect theft of bitcoins will be hard to demonstrate, although most jurisdictions do have a concept of intangible property, and unless china does not, I dont see why it wouldnt have applied to that game sword.

In most cases however, assuming you willingly sent your coins, so the "theft" isnt a result from someone hacking your PC (in which case other laws would apply), then fraud would likely be easier to prove. From wiki:

In the United States, common law recognizes nine elements constituting fraud:[8][9]

a representation of an existing fact;
its materiality;
its falsity;
the speaker's knowledge of its falsity;
the speaker's intent that it shall be acted upon by the plaintiff;
the plaintiff's ignorance of its falsity;
the plaintiff's reliance on the truth of the representation;
the plaintiff's right to rely upon it; and
consequent damages suffered by the plaintiff.

[CharlieContent]

I suspect theft of bitcoins will be hard to demonstrate, although most jurisdictions do have a concept of intangible property, and unless china does not, I dont see why it wouldnt have applied to that game sword.

In most jurisdictions, intangible property is things like copyright, patents, trademarks, brands and other intellectual property. While these are universally recognized as own-able properties, it's reasonable to say that none of these can be stolen in the same way as a Bitcoin. Intangible property is more a thing to be misused, or infringed upon. I can steal a Bitcoin and remove it from circulation, but I can't steal the Coca Cola logo and remove it from circulation.

From a semantic point of view, Bitcoins are of course intangible, but from a legal point of view I think they have little in common with what is usually defined as intangible property.

[greyhawk]

Ok, most of you don't know this, because they are either too young or have never worked a day in their lives. But in Europe before we had the Euro, we had another currency in addition to national currencies. That was the ECU, a digital, virtual currency extensively used for commercial and bank purposes across national borders within the EU. Stealing someone's ECU was of course illegal.

Bitcoin is the same thing.

[lonelyminer (Peter Šurda)]

If you convince someone to transfer Bitcoins to you while misrepresenting the nature of the transaction to the other party, this can be a violation of contract. It's not necessarily theft from a legal perspective but you can sue him for a contract violation.

If physical force is used, it's even easier. There have been several cases already where people were coerced to transfer virtual currencies (in one case they were threatened with a knife), and the court decided against the violator.

Property rights in Bitcoin are not necessary (indeed that would create contradictions just like any other IP rights). As long as there are property rights in media storing private keys and contracts are enforceable, there are no fundamental issues. The real issue seems to be how to find the perpetrator if something happens, however fiddling around with property rights definition does not fix that.

[CharlieContent]

Ok, most of you don't know this, because they are either too young or have never worked a day in their lives. But in Europe before we had the Euro, we had another currency in addition to national currencies. That was the ECU, a digital, virtual currency extensively used for commercial and bank purposes across national borders within the EU. Stealing someone's ECU was of course illegal.

Bitcoin is the same thing.

The ECU wasn't a currency. It was a measurement of the valuation of a basket of currencies, to be used as an accounting unit. As such it wasn't possible to steal "an ECU". You could steal currency to the value of an ECU or number of ECUs, but not an ECU its self.

Bitcoin is not the same thing, in countless different ways.

[bitcoinbear]

Of course stealing bitcoins is illegal.

Which jurisdiction are you referring to?  Can you reference a law, statute or decision that can back up this assertion?

You seem very sure, but I am quite sure that it is a far more complicated matter than your answer suggests.

How about this question: Is stealing bread illegal?

I would answer: Of course stealing bread is illegal.

You: "In what jurisdiction? Can you reference a law?

Me: "WFT man, everybody knows its illegal to steal stuff."

I would hope that laws would be written to cover theft of property, the law does not have to name every possible item that could possibly be stolen.

[CharlieContent]

How about this question: Is stealing bread illegal?

Yes.

I would answer: Of course stealing bread is illegal.

Yep, I'm with you.

You: "In what jurisdiction? Can you reference a law?

It wouldn't take long to dig that out. People have been prosecuted for stealing bread many times i'd imagine. However there aren't any instances of people being prosecuted for stealing Bitcoins, so you are making an unproven assertion.

Me: "WFT man, everybody knows its illegal to steal stuff."

It's not always illegal to steal stuff. Check out the post I made earlier in the thread about that sword incident in China. Legal theft in action - and it's a very similar thing to Bitcoin.

I would hope that laws would be written to cover theft of property, the law does not have to name every possible item that could possibly be stolen.

Well laws are mostly pretty old, especially ones which deal with fundamental crimes such as theft. Here in the UK the Theft Act was written in 1968, when the idea of an item existing purely in the virtual world was science fiction. There were electronic funds transfers though, but those transfers were backed by hard currency somewhere or other. Bitcoin is backed by nothing. You can't take it out of the bank, it is purely a virtual item. To expect people to legislate for something like this back in 1968 is asking too much.

No laws name every possible item or have to, but usually they name one (or both) of two main types of legally defined property: tangible property, and intangible property. Tangible property is the stuff you can hold in your hand, like bread, or money (even if you never actually see the cash money and it just goes from bank to card to another bank etc, it still technically exists, it's in a vault, and you can go and get it whenever you want.)  Intangible property is intellectual property, like the copyright to a film.

Things can be both. Like if you buy an old master painting, generally the right to reproduce prints comes with it. But things can't be neither...or they are free for the taking.

Which category does a Bitcoin come under? I would argue that it is neither a tangible asset nor intellectual property. So, legally, it may not even be property at all, and therefore criminal charges can't be brought against Bitcoin thieves.

In the law, there are very few "of courses" If there was, we wouldn't need laywers.

[markm]

If bitcoin is not property, it cannot be owned.

If it cannot be owned, obviously I do not own any.

If I do not own any, obviously I do not owe any taxes on it.

Thanks for solving the tax problem for bitcoins!

-MarkM-

[justusranvier]

I see this entire thread as missing the point.

If you don't want your bitcoins to be stolen be careful about how you store them.

If you're not sure the police will do anything to help you recover stolen bitcoins and you don't want them to be stolen be very careful about how you store them.

[CharlieContent]

If bitcoin is not property, it cannot be owned.

If it cannot be owned, obviously I do not own any.

If I do not own any, obviously I do not owe any taxes on it.

Thanks for solving the tax problem for bitcoins!

-MarkM-

Haha wouldn't that be nice.

I'm afraid tax laws are a bit more simple than property laws! Income is income, whatever the legal status of the source. They are always very clear about that one.

However if you don't sell Bitcoins then you won't have any tax liability.

I see this entire thread as missing the point.

If you don't want your bitcoins to be stolen be careful about how you store them.

If you're not sure the police will do anything to help you recover stolen bitcoins and you don't want them to be stolen be very careful about how you store them.

I think you have missed the fact that this is precisely my point!

[bitcoinbear]

If bitcoin is not property, it cannot be owned. If it cannot be owned, obviously I do not own any. If I do not own any, obviously I do not owe any taxes on it. Thanks for solving the tax problem for bitcoins!

-MarkM-

Haha wouldn't that be nice.

I'm afraid tax laws are a bit more simple than property laws! Income is income, whatever the legal status of the source. They are always very clear about that one.

However if you don't sell Bitcoins then you won't have any tax liability.

To have something count as income, you have to gain possesion of it. If bitcoins cannot be owned then they cannot be income.

It does not matter if you sell them or not. What matter is if you own them or not. If one can own bitcoins, and I claim they can, then whether you sell them or not makes no difference. Just like any barter transactions. For example, I do some work for a guy and he gives me a TV. That TV would count as income whether I sell it or not. Barter transactions may be more complicated and harder for the government to monitor, but they are still taxed like monetary transactions.

[SgtSpike]

There's no legal precedent for stealing Bitcoins = theft, but I am certain any court of law would rule it theft if it came up in a lawsuit.  They have obvious value, and people can own them.

[Gatorhex]

Hacking is a crime.

Breaking a contract for non-legal tender is not.

[casascius]

I suspect theft of bitcoins will be hard to demonstrate, although most jurisdictions do have a concept of intangible property, and unless china does not, I dont see why it wouldnt have applied to that game sword.

In most jurisdictions, intangible property is things like copyright, patents, trademarks, brands and other intellectual property. While these are universally recognized as own-able properties, it's reasonable to say that none of these can be stolen in the same way as a Bitcoin. Intangible property is more a thing to be misused, or infringed upon. I can steal a Bitcoin and remove it from circulation, but I can't steal the Coca Cola logo and remove it from circulation.

From a semantic point of view, Bitcoins are of course intangible, but from a legal point of view I think they have little in common with what is usually defined as intangible property.

If I prepay a year of tuition at a local university, what do I have?  Nothing?  Or a right to attend school there?  Is that an asset?  Do I own it?  Is it tangible?  Is it intellectual property?

There are plenty of other kinds of intangible property that aren't intellectual property.  Examples include unpaid debts, water rights, liquor licenses, stocks, futures, electronic event tickets, someone's promise to perform or deliver something at a later date', etc...

[SgtSpike]

Hacking is a crime.

Breaking a contract for non-legal tender is not.

Breaking a contract may not be a crime, but you can still certainly be sued for it.

[Gatorhex]

Breaking a contract may not be a crime, but you can still certainly be sued for it.

No you cannot. All contracts have to made in the legal tender of the land to be recognised by the court of the land. If you cannot pay your taxes in it, it's not legal tender.

[DannyHamilton]

Breaking a contract may not be a crime, but you can still certainly be sued for it.

No you cannot. All contracts have to made in the legal tender of the land to be recognised by the court of the land. If you cannot ay your taxes in it, it's not legal tender.

Not sure what land you are from, but this is definitely not true in the United States.

I can enter a contract with someone to exchange 5 televisions for their 3 microwave ovens.  If they fail to deliver the microwave ovens, the courts of the land will still recognize the contract.  Now, I will be expected to be willing to accept the legal tender of the land as restitution.  But once I have that legal tender, I can go find someone willing to exchange 3 microwave ovens for it to make my intended transaction whole once again.