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Judge Shoots Down "Bitcoin Isn't Money" Argument In Silk Road Trial
An anonymous reader writes in with the latest in the case against the alleged creator of the Silk Road, Ross Ulbricht. The government and legal community may still be arguing over whether bitcoin can be defined as "money." But the judge presiding over the landmark Silk Road drug case has declared that it's at least close enough to get you locked up for money laundering. In a ruling released Wednesday, Judge Katherine Forrest denied a motion by Ross Ulbricht, the 30-year-old alleged creator of the Silk Road billion-dollar online drug bazaar, to dismiss all criminal charges against him. Those charges include narcotics trafficking conspiracy, money laundering, and hacking conspiracy charges, as well as a "continuing criminal enterprise" charge that's better known as the "kingpin" statute used to prosecute criminal gang and cartel leaders.
Really. One would have to be extremely dense, or have lived in a cave for the last 30 years to not make the connection that Bitcoin is still a financial tool. Bitcoin's primary purpose is to traffic/launder money and goods. But it's not just bitcoin, it's also all those various game time cards you can buy at 7-11.
a "continuing criminal enterprise" charge that's better known as the "kingpin" statute used to prosecute criminal gang and cartel leaders.
Given the billion's of $US that various banks have been fined recently, for things like evading US taxes and money laundering for Syria, Iraq, and Somalia, isn't it about time that the legal system give the same treatment to bankers committing these crimes?
Why do they get to pay fines that don't have any real effect? Just look how their stock always go up after they announce a deal. If any individual ever gets fired it's always the low level person who takes the hit, and they all end up going to work for someone else and never face any real problems.
Oh, I just remembered: bribes/campaign contributions along with the revolving door and juicy high paying jobs for former regulators. To bad drug dealers can't have a revolving door with law enforcement.
Why is Snark Required?
So Russians money is not money? No other country has money because congress is the only people that can make money? Of course the contitution does NOT say that only congress has that ability, just that they are able to coin money.
Article 1, section 8 ....
To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures; ....
Now if you can tell me where in that line it says that ONLY congress is able to make money I will bow down to your constitutional knowledge.
When you cant win, ad hominem.
Bitcoin's primary purpose is to traffic/launder money and goods.
I was going to say something about people who are financial tools themselves...
However, I guess you're right. I want to be responsible for my money, and I want to be able to use it freely, without government snooping. If that makes me a money launderer, so be it. It's like those politically organized pirates that simply want to use a free Internet, rather than rape and pillage.
Bitcoin isn't even particularly anonymous. If you want to launder your coins, you need to trust a third party, which kind of ruins the point of a decentralized/free currency. There are much better cryptocurrencies out there for anonymous purposes.
Escher was the first MC and Giger invented the HR department.
It's called the Dormant Minting Clause. But you probably haven't heard of it...
The judge dismisses the 'bitcoin is not money' portion based of a ruling that the IRS and Fed Reserve do not have the authority to define what 'money' is. (both having defined bitcoin as 'property' and not 'money') Which is all fine and good, but the US Marshal has already ruled bitcoin as property since they disposed of the seized bitcoin through a property sale. There are very particular and different rules governing the disposal of money and property. One would think the US Marshals office actions would be the statute defining action.
do you really think the US government wont have it both ways? i'm reminded of this story: "US government declares hacking an act of war, then hacks allies"
if I've learned anything in my life, it's that laws, logic and common sense dont really matter to the government or big business... unless it's convenient.
Anons need not reply. Questions end with a question mark.
Since we are supposed to report the value of barter transactions to the IRS at tax time, I don't think one (in the US, anyway) can ever argue in court that something used as a proxy for value cannot be treated as "money".
Method of processing duck feet
The Constitution does not say this. It states that the Federal Goverment can issue and regulate money but not that it has a moneopoly. In fact, for the majority of US history private money was very common. i.e. Bank notes issued by private banks. It was not until the Civil War that goverment money was common and IIRC not until the early 1900 when private bank notes becaome uncommon.
What makes someone a money launderer is how they employ tricks to eliminate any trace between the money exchanged in an illegal transaction and how it is being officially accounted for.
In very much the same way as a specific brand of laundry detergent is used as a currency in illegal transactions.
In the case of encryption key schemes such as bitcoin, the thing that gave it traction was how the silk road functioned through a wink and a nod, with peers agreeing that to conduct their illegal business they first exchanged their money for crypto keys, conducted the business by giving the crypto keys in exchange for illegal goods and services, and then exchanged the crypto keys for real money. The only purpose behind this scheme was to eliminate the paper trail between the money and the illegal transaction.
That's what makes it a money laundering scheme. Because its primary use is to launder money.
Seriously is it that hard to keep the utter bullshit out of the summary. The ruling made no such suggestion that bitcoin was money or close enough. She ruled you can convert bitcoin to money, the same way you can convert a bag of cow shit. In other words she ruled that bartering goods doesn't get around money laundering rules as the goods have value.
Money is anything that can be used to store or trade value. Anything *can* be money, but that doesn't mean it is.
If people are buying bitcoin, then trading it for goods, services, or other forms of money, then, de-facto, it's money.
My Other Computer Is A Data General Nova III.
But he's not charged with money laundering. He's charged with conspiracy to launder money. If dirty money comes in and clean money comes out then money laundering has occurred, whether or not some of the intermediate steps involved the exchange of non-monetary assets. So "I was only involved in transactions involving the exchange of non-monetary assets" is irrelevant: what matters is a) whether they were part of a larger chain of transactions to launder money; b) whether he was aware of that larger chain.
That is not how money laundering looks like. Here is what Money Laundering Looks like
Illegal gained money is given to a Legitmate enterprise (Gambling) and is returned as "profit" or whatever from the enterprise. In a very simple case, mob money is put into a slot machine, and 98% of it is returned when the jackpot is hit. The gains, now washed (legitimate) are taxed and are clean for use elsewhere (deposit into a bank). Where if you just stuck the gains in the bank would trigger all sorts of investigations. This is part of the reason why deposits of $10,000 or more in banks are automatically reported to treasury, for an audit of the money trail.
The trick in money laundering is to hide the input (initial gains being laundered) well enough that it doesn't trigger the reporting requirement of transactions of 10K or more. A series of 5000 "high risk" transactions where you lose most of the time, but win big occasionally, is typically how money is laundered. The inputs are not traceable, and the earnings become legitimate.
The goal is always to hide the initial input, obfuscate the long trail of transactions and end up with legitimate money on the back end. The transaction you describe is used to obfuscate the buyer and seller from each other, and the authorities, not the transaction. Money laundering still has to occur with the seller, as the bitcoin to currency exchange still has dirty money written all over it.
Agent K: A *person* is smart. People are dumb, stupid, panicky animals, and you know it.