[cryptography] Is Bitcoin legal?

John Levine johnl at iecc.com
Thu Jun 16 00:34:39 EDT 2011


Bitcoins aren't securities, because they don't act like securities.
There's no promise to pay, no nominal value, and you don't have a
claim on some part of something else.

Earlier I said that bitcoins are digital tulip bulbs, but now that I
think about it, they're really digital pet rocks.  They have no
inherent utility or value, only novelty value.  Like pet rocks,
they're worth what some other collector is willing to pay for them.
Just because someone is willing to swap you a beer in exchange for two
pet rocks doesn't make them money.

I suppose there could be tax implications if people swap stuff for
bitcoins, but that's no different than any other barter transaction.

R's,
John



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