Legal Definition of Bitcoin – Introduction

Starting from Comments by Edmund Moy on Coin Telegraph (rivisited)

“What the judge [Judge Amos Mazzant] is saying is that judges determine whether a law was violated. In the case of Bitcoin, there is no federal law that specifically mentions bitcoin, let alone defines it. Lacking a Bitcoin federal law, regulatory agencies can then regulate the aspect of Bitcoin that is consistent with the federal law that created that regulatory agency.  Therefore, the IRS sees Bitcoin as a taxable event, the CFTC as a commodity, the FEC as a campaign donation, the SEC as an investment, [FINCen as money] etc.

So the SEC regulates investments/securities, and therefore has the authority to prosecute ponzi schemes. Ponzi schemes are funded by money, and because this one was funded by Bitcoin, Bitcoin functions like money and therefore they can prosecute the owners of the Ponzi scheme.

And while the IRS has said that Bitcoin meets their definition of property, it hasn’t opined on whether it meets the IRS definition of money. That doesn’t mean Bitcoin is not money, it just means the IRS is currently silent on the issue.”

This comment gives more light and is similar to my interpretation that considers bitcoin anything and nothing at the same time, and so every regulatory system should regulate the characteristics of bitcoin more consistent with the system.

This interpretation resolves in an objective manner the problems arisen by bitcoin, considering  the legal nature of bitcoin. Resolving in subjective manner (on the behavior of the “actor”) is fuzzy and could lead to inequality because focuses on the effects and not on the cause (definition of bitcoin).

Bitcoin is:

1. Money, because they meet the classic definitions.
2. Foreign currency, as it has no legal tender in any country.
3. Commodity, as fungible produced by human activity and is recognized as valuable in a community.
4. Financial Instrument (Securities), as its value depends on offer and demand and it is traded in a market.
5. Intangible Assets, as it does not physically exist.
6. Barter Rights, as they can be exchanged for goods and services expressed in that unit of account.

But, at the same time bitcoin is not any of the above points and/or has more properties.

So let the lawyers do the job!

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