Home » Analytics » Bitcoin-related legal precedents set in 2016

Bitcoin-related legal precedents set in 2016

bitcoin legal decisions


In 2016 were agreed a number of very important legal decisions that further could impact on the entire cryptocurrency industry. In this article, were described the most interesting, though precedents have been much more.

Bitcoin: money or goods?

The eternal point of the legal status of Bitcoin is still relevant, the answers are rather contradictory. The digital coin is differently set not only in various countries but even within one country - for example, in the US.

New York

During a trial over hacker attacks against J.P. Judge Morgan in New York, a judge determined the digital coin as cash. Alison Nathan, District Judge in New York, denied Anthony Murgio's effort to stop 2 cases upon his activities on Coin.mx.

Despite Murgio's statement that in obedience to US laws, Bitcoins did not set as "cash", the court did not accept his arguments.

"Bitcoin - a monetary unit", - wrote Judge Nathan - "The digital coin can be taken as a paying for products and services, and you could easy sell them, and receive funds directly to your bank account. So, they can be called as cash, as they circulate in the same way as money, and are means of paying".


A Miami court judge was quite opposite, rejected in July this year charges of cash laundering by website creator Michell Espinoza. Espinoza was accused of unlawful transferring 1,500 Bitcoins to acting agents who asked him to sell stolen credit card numbers.

Teresa Mary Pooler, Judge Miami-Dade County, determined Bitcoin - neither official currency, no material value and "it could not be kept under a bed as cash or gold" (actually, nothing prevents to "hide under a bed "a printout private key, previously removed from all electronic resource).

At the conclusion, she summed up: "The court is not a specialist in the field of economy; even without possessing sufficient competence in this sector, before Bitcoin will become adequation of cash, it has to go a long way".

She stressed the law of Florida was too vague upon the applying of the digital coin:

"The court does not intend to penalize a man for realization his possessions to another person, if his actions are subject to the law, drawn up so vague, so even justice specialists can not reach a consensus".

North Carolina

On July 6, Pat McCrory North Carolina Governor underwrote a law that supplemented the North Carolina Money Transmitters Act related to Bitcoin and other digital coins.

The bill was first represented in 2015; it has been criticized despite the changes made with respect to the participants in the digital sector.

As explained by the representative of accused Jason Seibert," the best way to characterize the digital coin - a merchandise that can be utilized as cash - just like any other merchandise".

Conviction of the first cryptocurrency perpetrator

In July 2016, "the first cryptocurrency offender" was sentenced to 18 months' imprisonment. Trendon Shavers, known under nickname - pirateat40, was convicted in a matter related to his activities on the organization of financial pyramid Bitcoin Savings & Trust in 2012. Under the current rate of Bitcoin, the fraud would have been comparable to MtGox's collapse.

Also, Shaver was sentenced to restriction of freedom for a term of three years, to pay a special tax collection, compensation, damages.

The US tax office and the claim to Coinbase

The Internal Revenue Service (IRS) has registered a lawsuit in the US District Court of California with claims to provide an admission to data of Coinbase's customer, from 2013 to 2015.

IRS has found 3 incidents where US citizens allegedly tried to avoid taxes using digital coins. In 2 incidents they were utilizers of Coinbase. The company, in turn, filed an appeal with the intention to refute the IRS's interpellation.

Ripple has received BitLicense in the State of New York

On June 13, the Financial Regulator of New York issued the first license BitLicense to RippleLabs. Per the report the Ministry of Finance, Ripple meets standards for combating cash laundering, utilizer protection, information security.

European regulated product

This summer, the first adjustable cryptocurrency product appeared on the European market. Gibraltar Stock Exchange has set a project - BitcoinETI, which is a secured by assets exchange tool.

BitcoinETI was endorsed for applying in regulated brokerage transactions in Europe thus the moderation of the digital coin and fintech in Europe is "more mobile" than in the United States.

Bitstamp Regulation in Europe

In late April, Bitstamp announced it had gotten a permission to act in Europe. The license issued by the Ministry of Finance of Luxembourg.

Per Bitstamp's Dan Morehead, now Bitstamp may carry out activities in 28 EU states. Bitstamp spent 2 years to receive this license.

Hearings on Silk Road

Hearings on Silk Road’s case held in 2016. The defense claimed the indictment to Ross Ulbricht for his work on Silk Road was put on a trial, during which there were violations of procedural norms.

The matter is still pending before the Court of Appeal, however, but there a lot of data indicating to the corruption of law enforcement officials.

Bitcoin in Russia

On October 3, 2016, Alexey Overchuk, deputy head of the Federal Tax Service published a letter, the main conclusion - in the legislation of Russia has no direct prohibition to use cryptocurrencies by Russian citizens. In this case, the Federal Tax Service of the Russian Federation classified the transactions on purchase and sale of cryptocurrencies as foreign exchange transactions. The legislation of the Russian Federation did not define such concepts as "quasi-money", "cryptocurrency" or "virtual currency".

It is the first case in Russia when the federal body of executive power was on the side cryptocurrencies. Thus, this letter can promote the legalization of cryptocurrencies and the formation of a regulatory framework that will ensure their turnover in the territory of the Russian Federation.

Discuss on the forum