Bitcoin in France: first legal decision directly related to Bitcoin?

[wareen]

...and for those worrying about laws making the rate go down, ask yourself; what happened to the price of liquor during prohibition in USA?

If bitcoins were the only way to make payments, then that comparison would have at least a tiny bit of sense...

Or if they could get you addicted... wait...

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[EhVedadoOAnonimato]

The idea of a Bitcoin religion is quite good. Seriously.

In Brazil, for example, there are some people who worship an hallucinogenic plant (Ayahuasca). It's the only hard drug allowed in the country, as far as I know, precisely due to its religion background. And, according to wikipedia, even the US Supreme Court ruled that, due to the Religious Freedom Restoration Act, this religion cannot be forbidden to take its hallucinogenic during their rituals.

[miernik]

Those still need to be licensed (and are legally treated as a bank in most countries).

Licensed - yes, but "legally treated as a bank" - bullshit.

A licence for a currency exchange office is MUCH MUCH simpler than a bank licence. Lots of those currency exchange places are really small, running as a sole proprietor tiny business by one or two people. The "licencing" is pretty much just registering, and if you meet basic requirements (like not being a convicted criminal for financial crimes, and finishing some course of handling money), you just get it.

Starting a bank is about a million times more larger complication then stating a currency exchange business. Currency exchange company is nowhere near being "legally treated as a bank", as they can not borrow to someone else money which was deposited to them - that is what distinguishes a bank from not-a-bank - being able to lend money which people deposited with your. There are literally thousands, if not millions of small businesses in Europe legally doing all kinds of money-handling business, from currency exchange to money transfer, heck even a credit card processing company is not a bank, and they are lots of these popping-up.

[lazycodre]

I have in the last census my religion as Jedi. Happy to convert to Bitcoin religion now. Agree to be a high priest.

http://img580.imageshack.us/img580/5548/bitcoinseance.jpg
By tommylarusso at 2011-09-06

[lazycodre]

think of the money you could make from starting a cash-to-btc street office chain...


http://img16.imageshack.us/img16/8422/hazthebitcoin.jpg

Uploaded with ImageShack.us

[greyhawk]

I think when people realize the value Bitcoin is *NOT* what some silly bank in France decide or their legal system dictates, or what what the mainstream media makes of it, then the exchange rate will follow upwards. The more laws Bitcoin break, the better it will be in that aspect.

The true value of Bitcoin comes (or will come eventually) from the rigid system itself, the simple fact it is free from regulations, and not affected by any laws in any country even if it were to be declared illegal.

This means Bitcoin will outlive any country laws, any exchanges, any shit you throw at it, because that is the core purpose of it.

Pray tell and where would you buy something with these bitcoins if they were declared illegal?

[miernik]

It really depends what the exchange is doing. The nature of the BTC exchanges is to received deposits and manage funds. The exchange houses you are thinking of do not do the same thing, it is just a walk in and out exchange. Taking deposits is regulated, not as a bank, but as a financial institution (same applies to all sorts of bodies that handle financial transactions).

I know several companies providing financial services, NOT being regulated, and successfully getting around that by: instead of customers making deposits, customers are "buy" "points" (for example at an exchange rate 1 cent = 1 point) and those points sit in customers account, and when the customer wants to withdraw, he is "selling" those points. These are quite large companies in Poland operating this way, providing online auction services, social lending, etc. All of them use the legal trick with "points", instead of simply deposits in currency. And it works, authorities are not touching them.

[netrin]

1) What is the issue to become an official bank for MtGox?

I discussed setting up a financial business with my lawyer in Denmark (because of certain off-shore legal properties) and found the 2009 Consolidation Act quite interesting. The first two pages list numerous previous laws (many European) that this act considers/consolidates/supersedes. It breaks businesses into a number of categories, credit, investment, insurance, etc for those located within, without, and dealing with customers within and without Europe. It looked like one million EUR just to start the process.

But I agree with Tux's defense in summary. Bitcoin is not money any more than collectors items such as baseball cards, prime numbers, or gold. Ben confirmed under oath that gold is not money, but the European Union reserves a special legal place exclusively to gold and no other commodity. If bitcoin is money, that opens up a larger can of worms for the EU.

[Lolcust]

I have in the last census my religion as Jedi. Happy to convert to Bitcoin religion now. Agree to be a high priest.

I sincerely believe this idea to be worthy of consideration.

If some B- (I'm being generous here) sci-fi writer can start a worldwide religion, so can we.

P.S.:
Re the whole "is it money" issue - bitcoin is "money" to the same extent that China is a giant, living organism

[elggawf]

If you think bitcoin is not money, are you people happy to pay VAT and GST and other sales taxes on it?

Gotta either pay taxes on it, or with it, which is worse?

[netrin]

It looks like money, it feels like money, it can replace other kinds of money, it can be used as money... Quite a can of worms if you think about it.

Whatever we think of it is legally irrelevant. Perhaps it will define a new asset class. But if the European Union accepts bitcoin as money, to settle all debts public and private...

[Big Time Coin]

My reasoning: It looks like money, it feels like money, it can replace other kinds of money, it can be used as money. Interesting, maybe it is money, after all. Even if some "depositary institution" does not want to play by the rules of "depositary institutions", bitcoin is still money.

Folding paper printed with govt. figures and coins stamped with heads of state looks like money.  Bitcoin doesn't look like money.
You can't feel it in your hand at all, it is purely virtual, microscopic bits.  Bitcoin doesn't feel like money
not until there are insured deposits in safely regulated banks that pay their operating costs from loans, thus increasing the money supply
YES IT CAN

It's just semantics when you are talking about is bitcoin money?  is bitcoin currency?  It is what it is, and these words help to define it so people can understand what it is.  The word MONEY doesn't change what bitcoin is.

We all hope that it IS NOT defined as a virtual currency by the french court, right?  In fact, the arguments should be that bitcoin IS NOT money, IS NOT currency, IS NOT any previously defined legal category of thing.  That way, it IS NOT subject to already existing regulations that will make it harder for it to succeed.  Just because you think of it that way, doesn't mean it helps the community to portray it as such to the public.

[EuSouBitcoin]

Bitcoin is certainly not Fiat Money. However, Bitcoin can serve as a medium of exchange; a unit of account; and a store of value. But Bitcoin does not fit neatly into any of the categories for types of money. See
http://en.wikipedia.org/wiki/Money#Types_of_money
Bitcoin has some characteristics of commodities, some of money and some new characteristics. Bitcoin is really a new category because it does not fit into any of the previous categories.

[TraderTimm]

Bitcoin is a medium. A secure medium, but a conduit to transfer perceived value. Like air facilitates speech, bitcoin facilitates transactions. Lawmakers and legislators typically have zero ability to adapt to virtual concepts, even though skimming billions off a tax-base is second nature. Oh, the irony.

[Narydu]

Do you agree?
It looks that there are three issues on stake.

a) The definition of WHAT THE HECK IS BITCOIN. Let me give a dummy aproach.
It's clear now to me that Bitcoins itself are no "Money", just exchangeable "virtual assets" assigned not to people but to particular "digital certificates". Assets that are generated with not a single $ put on it (other than the tools+labor "energy" used to harvest it - such as hands+human energy or computer+electricity to mine virtual assets), and can be exchanged for any other king of asset such as money, gold, goods, etc. This is simillar as to creating an ashtray from mud and sell it in my front door to people (when I was a little kid), its price would be based in the effort to do some newone my self, getting an other similar to it, or the uniquity of my creation. I believe this makes Bitcoin similar to a regular "asset" aproach. Perhaps we should all replace the definition of "virtual currency" for "virtual asset".

b) Is it legal to trade Bitcoins for regular money? An if so, should it have taxes or regulations?
I believe that any "other" asset is absolutelly legally to trade, this shouldn't be an exception (unless... read "c"). If we love bitcoins because they can exchanged from Person 2 Person (the original idea), no one should forbid such (P2P is usually used for piracy, but this has nothing to do with it), as regular money isn't forbidded to exchange hands freely. But if this exchange has to be done over an exchange or formal platform it should pay taxes as any other asset.

c) What might come next?
a- If governments believe that BTC cand o will be used as a way of avoiding taxes, crossborder regulations, money laundering, etc, it cares not if there are actual laws or new laws... they will just regulate it. If the first one is good for Bitcoins or not, who knows, I think that even though we shoukd tell who we are, pay taxes, etc, BTC will have fewer transaction fees, fewer asset holding fees (vs money in banks), quicker payment recieving, unfakeable and controled emission, etc, all things that will still make the BTC interesting as an asset.
b- IF governmets think that the Bitcoin protocol, network, blockchain, etc is unsecure, they might try to shut it as for avoiding people to invest regular assets in this unsecure asset, but thought it looks secure enough this shouldn't be the case. But if so, trolls, noobs, regulars we be glad.

So I believe this should come fine for MtGox as a trader unless his LCC has no legallity to trade assets, but if we keep on the trace of mainstreaming it we should expect some general regulations.

[modrobert]

If true freedom (not the limited USA version) was a commodity, I think we can all agree the global demand is bigger than the supply. This is the reason Bitcoin will succeed where others fail.

[molecular]

If true freedom (not the limited USA version) was a commodity, I think we can all agree the global demand is bigger than the supply. This is the reason Bitcoin will succeed where others fail.

+1 well said, modrobert.

[MagicalTux]

If you think bitcoin is not money, are you people happy to pay VAT and GST and other sales taxes on it?

Gotta either pay taxes on it, or with it, which is worse?

As a business we are already paying taxes on bitcoin, as acquisition of valued non-expirable goods.

[The_Duke]

If you think bitcoin is not money, are you people happy to pay VAT and GST and other sales taxes on it?

Gotta either pay taxes on it, or with it, which is worse?

As a business we are already paying taxes on bitcoin, as acquisition of valued non-expirable goods.

Good to see that MtGox has already debunked two of the most bitcoin myths. Bitcoin is not anonymous. Bitcoin is not "tax free".

[netrin]

Good to see that MtGox has already debunked two of the most bitcoin myths. Bitcoin is not anonymous. Bitcoin is not "tax free".

..and that it's deflationary.