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Federal Judge Rules Bitcoin Is Money In Case Tied To JPMorgan Hack (reuters.com)
Roughly two months ago, a Miami-Dade judge ruled that bitcoin does not actually qualify as money. Now, it appears that bitcoin does indeed qualify as money, according to U.S. District Judge Alison Nathan in Manhattan. "Bitcoins are funds within the plain meaning of that term," Nathan wrote. "Bitcoins can be accepted as a payment for goods and services or bought directly from an exchange with a bank account. They therefore function as pecuniary resources and are used as a medium of exchange and a means of payment." Reuters provides some backstory in its report: Bitcoin qualifies as money, a federal judge ruled on Monday, in a decision linked to a criminal case over hacking attacks against JPMorgan Chase and Co and other companies. U.S. District Judge Alison Nathan in Manhattan rejected a bid by Anthony Murgio to dismiss two charges related to his alleged operation of Coin.mx, which prosecutors have called an unlicensed bitcoin exchange. Murgio had argued that bitcoin did not qualify as "funds" under the federal law prohibiting the operation of unlicensed money transmitting businesses. But the judge, like her colleague Jed Rakoff in an unrelated 2014 case, said the virtual currency met that definition. Authorities have said Coin.mx was owned by Gery Shalon, an Israeli man who, along with two others, was charged with running a sprawling computer hacking and fraud scheme targeting a dozen companies, including JPMorgan, and exposing personal data of more than 100 million people. That alleged scheme generated hundreds of millions of dollars of profit through pumping up stock prices, online casinos, money laundering and other illegal activity, prosecutors have said.
When it serve their interest Bitcoins are money, when it goes against their interest Bitcoins are not money. How convenient!
I think the issue that the Courts may be struggling with is whether or not Bitcoins are fiat currency in the United States.
... We'd need to look, but perhaps if Bitcoin is ruled a "fiat currency", then anyone offering financial services such as deposit or exchange would have to have a proper, Federal-Reserve-Issued "Banking Licence". Existing Banks might like that...
See Wikipedia: https://en.wikipedia.org/wiki/...
In other words, somewhere, in a piece of legislation enacted within U.S. Law, there will be something to the effect that "The United States Dollar, issued and enacted by the Federal Reserve Bank of the United States, is the acceptable currency of the nation". That statement will make the Dollar the "fiat currency" of the United States. But it also implicitly means that any *other* currency is *not*...
( We could envisage a scenario in which, absent such a decree/requirement, you and I could agree some complex scheme to defraud the Federal Government of tax revenue. I could sell you a car for "ten bananas" and when asked for taxes by the government, could give them a couple of pieces of fruit to cover the tax. )
However, it does sound as though the two rulings might be very subtly different. If one question was, "Does bitcoin perform a function equivalent to money?" then the answer would be "Yes". If the other question was, "Is Bitcoin a fiat currency within the United States?" then the answer would be "No". We'd need a lawyer to interpret the potential differences between the two rulings, however, because context will be everything...
Footnote: crypto-currencies create a huge headache for the big (multinational) banks, because they allow private individuals to exchange funds between currencies without paying currency exchange fees. Given that this is one of the most lucrative forms of income for banks [think about the amount of international trade that needs to be converted between currencies - and you will see that even a small "spread" will generate vast profits] and it is clear why they are so keen to see these definitions go "their way"
Boy, for someone with that tag line you seem conveniently ignorant of the U.S. Constitution. See Article I, Section 8, Clause 5. It isn't illegal to have foreign money, but it is illegal to create or coin money. And yes, our government is completely hypocritical about that when it ignores credit cards, debit cards and "gift cards".
I'm an American. I love this country and the freedoms that we used to have.
Actually written laws in the US normally include a "Definitions" section. Different laws in different states can and do use different definitions. In these case, neither actually used the term "money", so it's two completely different words being defined, of course the definitions are different.
The summary refers to a case in which a judge ruled that Bitcoin did not meet the requirements of one specific Florida law. The Florida law refers to "monetary instruments" and defines it as follows:
âoeMonetary instrumentsâ means coin or currency of the United States or of any other country, travelersâ(TM) checks, personal checks, bank checks, money orders, investment securities in bearer form or otherwise in such form that title thereto passes upon delivery, and negotiable instruments in bearer form or otherwise in such form that title thereto passes upon delivery.
Bitcoin is not "coin or currency of the United States or of any other country", it's not a money order, etc.
The federal law in the new case says:
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provides check cashing, currency exchange, or money transmitting or remittance services, or issues or redeems money orders, travelersâ(TM) checks, and other similar instruments or any other person who engages as a business in the transmission of funds
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Note all of the ORs- only ONE need be true. If it's "money transmitting", it qualifies, OR if it's "other similar instruments". That's a difference between the federal law and the Florida law, the Florida law doesn't say "other similar instruments". Bitcoin may well be a "other similar instrument".
* The Florida law does mention "negotiable instruments", but those are elsewhere defined as documents ordering the payment of a *specific sum of money*. Bitcoins don't order the payment of a specific sum of money, unless perhaps you first define Bitcoin as money, but that's circular.
> So the question stands, how is possessing this illegal?
It's not.
> Has bitcoin been declared the first illegal virtual substance?
No.
The ruling is that operating a business of providing money transfer services using Bitcoin to do it qualifies as one of these:
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provides check cashing, currency exchange, or money transmitting or remittance services, or issues or redeems money orders, travelers' checks, and *other similar instruments* or any other person who engages as a business in the *transmission of funds*
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In other words, the ruling is that Bitcoin is one of the following three things:
A: "other similar instruments" (similar to money orders or travelers' checks)
B: A way to accomplish "transmission of funds"
C: Can be in the same category as the listed examples - it can be used for a money transfer service.
Running a money transfer business, in some situations, requires registration. The ruling is that the defendant ran a money transfer business, using Bitcoins to do it.
No, it doesn't "just" grant Congress the power. It grants Congress the exclusive power. Study your history. It was put in there to avoid the problem of States and even private banks issuing their own currency, which was a problem at the time.
I'm an American. I love this country and the freedoms that we used to have.
Money is by it's very nature little more than a sophisticated IOU system for real wealth (food, property, etc). The paper itself is practically worthless outside that context.
--- Most topics have many sides worth arguing, allow me to take one opposite you.
With PLEX an exchange rate to real-world currency has been established. So will this pave the way for game criminals to face real world criminal charges?
Chewbacon
The Bible is like Wikipedia: written by a bunch of people and verifiable by questionable sources.