Florida Court Rules Bitcoin Not Money

None of us is really sure what bitcoin is, or what it’s fully used for. It seems the courts are just as confused.

A judge in Florida v Espinoza recently stated the following in regards to a police sting involving Bitcoin:

Nothing in our frame of references allows us to accurately define or describe Bitcoin…

Bitcoin may have some attributes in common with what we commonly refer to as money, but differ in many important aspects. While Bitcoin can be exchanged for items of value, they are not a commonly used means of exchange. They are accepted by some but not by all merchants or service providers. The value of Bitcoin fluctuates wildly and has been estimated to be eighteen times greater than the U.S. dollar. Their high volatility is explained by scholars as due to their insufficient liquidity, the uncertainty of future value, and the lack of a stabilization.

Bitcoin is a decentralized system. It does not have any central authority, such as a central reserve, and Bitcoins are not backed by anything. They are certainly not tangible wealth and cannot be hidden under a mattress like cash and gold bars.

This Court is not an expert in economics, however, it is very clear, even to someone with limited knowledge in the area, that Bitcoin has a long way to go before it is the equivalent of money.

Although other individuals have been charged successfully for crimes which involved bitcoin, this charge related to the sale of bitcoin itself as an unauthorized money transmitter.

The decision appears to contradict other American government documents which encourage the treatment of bitcoin as currency.

The CRA has indicated they will treat bitcoin as taxable, and is regulated along with other virtual currencies under Bill C-31.