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WinMX World :: Forum  |  Discussion  |  WinMx World News  |  US federal judge: Yes, Bitcoin IS MONEY
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Author Topic: US federal judge: Yes, Bitcoin IS MONEY  (Read 334 times)

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US federal judge: Yes, Bitcoin IS MONEY
« on: August 07, 2013, 11:44:03 pm »
http://www.theregister.co.uk/2013/08/07/bitcoin_is_money/

Quote
The US Securities and Exchange Commission has charged Texas resident Trendon Shavers with operating a Ponzi scheme under the name Bitcoin Savings and Trust (BTCST), in which he allegedly sold fraudulent investment securities in exchange for more than 700,000 Bitcoin during 2011 and 2012.

During that period, Shavers allegedly offered investors as much as 1 per cent interest per day "until either you withdraw the funds or my local dealings dry up and I can no longer be profitable."

In reality, the SEC alleges, the only interest payments Shavers' clients received came from funds deposited by new investors, and Shavers diverted what limited proceeds he received from his Bitcoin trading activities to his own accounts.

In his defense, Shavers argued that what he sold his clients cannot be considered securities because no actual money changed hands. Shavers dealt exclusively in Bitcoin, and neither accepted nor paid US funds to his would-be investors.

On Tuesday, US magistrate judge Amos Mazzant ruled that Shavers' argument before the court didn't hold water, because as far as money is concerned, Bitcoin passes the "duck test":

    It is clear that Bitcoin can be used as money. It can be used to purchase goods and services, and as Shavers stated, used to pay for individual living expenses. The only limitation of Bitcoin is that it is limited to those places that accept it as currency. However, it can also be exchanged for conventional currencies, such as the U.S. dollar, Euro, Yen, and Yuan. Therefore, Bitcoin is a currency or form of money, and investors willing to invest in BTCST provided an investment of money.

Mazzant went on to rule that Shavers and his investors were engaged in a "common enterprise," where the investors relied upon Shavers' own expertise in Bitcoin markets and were expecting a substantial return on their investments from Shavers' Bitcoin trading activities.

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