U.S. Judge determines bitcoin is a currency

[DannyHamilton]

http://www.law360.com/articles/462977

Internet-traded bitcoins are a form of currency . . . a Texas federal judge ruled Tuesday

Bitcoin is a form of currency because it can be used to purchase goods or services and exchanged for more traditional forms of money, U.S. Magistrate Judge Amos L. Mazzant wrote in a decision Tuesday

It's nice to see the U.S. courts acknowledge reality once in a while.

[Gabi]

Bitcoin is a form of currency because it can be used to purchase goods or services and exchanged for more traditional forms of money

Bullshit, the same apply to gold but gold IS NOT money

http://www.forbes.com/sites/afontevecchia/2011/07/13/bernanke-fights-ron-paul-in-congress-golds-not-money/

And since bitcoin is, in my opinion, digital gold, i say that it is not money.

[elor70]

good to know...

[DannyHamilton]

Bitcoin is a form of currency because it can be used to purchase goods or services and exchanged for more traditional forms of money

Bullshit, the same apply to gold but gold IS NOT money

http://www.forbes.com/sites/afontevecchia/2011/07/13/bernanke-fights-ron-paul-in-congress-golds-not-money/

And since bitcoin is, in my opinion, digital gold, i say that it is not money.

You can say what you want, but apparently the U.S. court has decided to define bitcoin with the label of "currency" (which probably has more to do with the ineptitude of Mr. Shaver's legal team than with the judge's deep understanding of the technical issues behind defining bitcoin).

The fact that Mr. Bernanke chooses to state that gold is not "money" has very little to do with whether the U.S. courts would consider gold to be a "currency".

Can you find me a court case where gold was determined not to meet the requirements of being a currency?

As much as I'd like to see Mr. Shavers spend time in jail for his crimes, I really want him to have the best legal team possible.  This case is likely to set a lot of precedents for bitcoin, and if his legal team isn't top notch, many of those precedents are likely to be detrimental to bitcoin in the long term.

[JerimiahJohnson]

Law360, Los Angeles (August 06, 2013, 9:03 PM ET) -- Internet-traded bitcoins are a form of currency subject to federal securities laws, a Texas federal judge ruled Tuesday, refusing to dismiss the U.S. Securities and Exchange Commission's claims accusing the founder of Bitcoin Savings & Trust of running a Ponzi scheme.

Bitcoin is a form of currency because it can be used to purchase goods or services and exchanged for more traditional forms of money, U.S. Magistrate Judge Amos L. Mazzant wrote in a decision Tuesday.

Looks like pirateat40's case is being tried in Texas.

If his best defense is that "Bitcoin is not real money" he needs to hire a new lawyer

[Razick]

Bitcoin is a form of currency because it can be used to purchase goods or services and exchanged for more traditional forms of money

Bullshit, the same apply to gold but gold IS NOT money

http://www.forbes.com/sites/afontevecchia/2011/07/13/bernanke-fights-ron-paul-in-congress-golds-not-money/

And since bitcoin is, in my opinion, digital gold, i say that it is not money.

If Bernanke says gold is not money, you just take that as gospel? This is the same guy who is printing paper to "benefit" the economy.

[Gabi]

Now my question is: is gold considered "currency" for USA?

[DannyHamilton]

Now my question is: is gold considered "currency" for USA?

Create a gold based Ponzi scheme and I guess we'll find out.
 

[Gabi]

Well, i already know that stealing gold is punished, no need for that.

I am not saying that bitcoins can be stolen because they are not currencies! Of course if pirate ran that bitcoin ponzi he must be punished

[richard_dein]

I think, if I set up contracts to give 1 apple per day in exchange for a one-time payment of 10 apples, then when I run away it should still be illegal. It would be an other question whether it is a Ponzi scheme, rather than merely a breach of contract.

[DannyHamilton]

Well, i already know that stealing gold is punished, no need for that.

Sure, but can you be prosecuted by the SEC for running a Ponzi scheme that offers "securities" based in gold?

If so, then you can get a Federal judge to set a precedent (if it hasn't already been set) that gold is a "currency".

I am not saying that bitcoins can be stolen because they are not currencies! Of course if pirate ran that bitcoin ponzi he must be punished

The question isn't whether they can be stolen (well, actually I suppose that is a question as well), but rather does a Ponzi that is based in bitcoin fall under the jurisdiction of the SEC, or does some other executive branch division have to prosecute the case?

[DannyHamilton]

I think, if I set up contracts to give 1 apple per day in exchange for a one-time payment of 10 apples, then when I run away it should still be illegal. It would be an other question whether it is a Ponzi scheme, rather than merely a breach of contract.

Right, so would such an apple Ponzi fall under the jurisdiction of the SEC?

[threeip]

Law360, Los Angeles (August 06, 2013, 9:03 PM ET) -- Internet-traded bitcoins are a form of currency subject to federal securities laws, a Texas federal judge ruled Tuesday, refusing to dismiss the U.S. Securities and Exchange Commission's claims accusing the founder of Bitcoin Savings & Trust of running a Ponzi scheme.

Bitcoin is a form of currency because it can be used to purchase goods or services and exchanged for more traditional forms of money, U.S. Magistrate Judge Amos L. Mazzant wrote in a decision Tuesday.

Looks like pirateat40's case is being tried in Texas.

If his best defense is that "Bitcoin is not real money" he needs to hire a new lawyer

He is representing himself

[steelboy]

Law360, Los Angeles (August 06, 2013, 9:03 PM ET) -- Internet-traded bitcoins are a form of currency subject to federal securities laws, a Texas federal judge ruled Tuesday, refusing to dismiss the U.S. Securities and Exchange Commission's claims accusing the founder of Bitcoin Savings & Trust of running a Ponzi scheme.

Bitcoin is a form of currency because it can be used to purchase goods or services and exchanged for more traditional forms of money, U.S. Magistrate Judge Amos L. Mazzant wrote in a decision Tuesday.

Looks like pirateat40's case is being tried in Texas.

If his best defense is that "Bitcoin is not real money" he needs to hire a new lawyer

He is representing himself

Representing yourself is a really good idea 

[Coinmart]

Interesting read. Anyone have link or access to the full article?

[Serge]

http://www.forbes.com/sites/jordanmaglich/2013/08/07/court-green-lights-bitcoin-lawsuit-rules-investments-constitute-securities/

[Operatr]

Bitcoin is a form of currency because it can be used to purchase goods or services and exchanged for more traditional forms of money

Bullshit, the same apply to gold but gold IS NOT money

http://www.forbes.com/sites/afontevecchia/2011/07/13/bernanke-fights-ron-paul-in-congress-golds-not-money/

And since bitcoin is, in my opinion, digital gold, i say that it is not money.

The same does not apply to gold because gold cannot be spent as a day to day currency as it is not accepted anywhere, because raw gold is unsuitable to be a currency in this age. Bitcoin however can already be used to purchase goods and services from a growing list of vendors. So yes, Bitcoin is currency. Gold is a store of wealth and speculative tool.

Bitcoin =/= Gold, stop comparing the two this way.


As far as ponzi schemes, it is a crime weather it was conducted in fiat or Bitcoin, I don't see why the means really matters in the eyes of the law. Pirate defrauded a bunch of people, and should be punished for it.

[kjj]

Black's defines money as anything used as money, and currency as the subset of money that has been authorized by law.  The is different from conventional usage which holds the two terms to be synonyms, only weakly defined.

The judge in this case is clearly using the two words interchangeably, consistent with conversational English, and clearly also in the very broad definition that Black held for money.

It is clear that Bitcoin can be used as money.  [...]  The only limitation of Bitcoin is that it is limited to those places that accept it as currency.

If BTCST had traded in gold coins I would expect pretty much the same ruling.  For that matter, if there was a community that used sheep as money, and he had run this scam on them, I'd fully expect the judge to interpret the "investment of money" fork of the Howey test through the victim's eyes and issue the same ruling.

Lawyers have an ethical duty to try every possible defense, so this question was inevitable.  Of course, the answer was just as inevitable, as some of us have been saying for the last few years now.  Courts mostly operate on value, and most of the value that they see is not granted by the decree of some authority, but by the perceptions of the parties involved.

Let all of the scammers be on notice.  Your defense is now solely in your ability to keep your scams small enough that it isn't worth hunting you down.  Your claims that it wasn't really theft/fraud/whatever because bitcoins aren't issued by the government will fall on deaf ears, and some of you are going to end up in prison.

[QuestionAuthority]

Black's defines money as anything used as money, and currency as the subset of money that has been authorized by law.  The is different from conventional usage which holds the two terms to be synonyms, only weakly defined.

The judge in this case is clearly using the two words interchangeably, consistent with conversational English, and clearly also in the very broad definition that Black held for money.

It is clear that Bitcoin can be used as money.  [...]  The only limitation of Bitcoin is that it is limited to those places that accept it as currency.

If BTCST had traded in gold coins I would expect pretty much the same ruling.  For that matter, if there was a community that used sheep as money, and he had run this scam on them, I'd fully expect the judge to interpret the "investment of money" fork of the Howey test through the victim's eyes and issue the same ruling.

Lawyers have an ethical duty to try every possible defense, so this question was inevitable.  Of course, the answer was just as inevitable, as some of us have been saying for the last few years now.  Courts mostly operate on value, and most of the value that they see is not granted by the decree of some authority, but by the perceptions of the parties involved.

Let all of the scammers be on notice.  Your defense is now solely in your ability to keep your scams small enough that it isn't worth hunting you down.  Your claims that it wasn't really theft/fraud/whatever because bitcoins aren't issued by the government will fall on deaf ears, and some of you are going to end up in prison......

.......if you live in the United States.

[teamhugs]

2. Bitcoin being defined as "currency" by a Federal Judge is actually bad as it opens Bitcoin up to a whole host of US laws designed to prevent people from creating their own currency. Can you say "Liberty Dollar".

THIS should be the concern. Bitcoin being a currency means now the entire banking infra can enforce laws and policies on bitcoin. Welcome to fees, regulation, and loss of freedom.