Ever since its invention, people have been unsure whether Bitcoin should be considered property or money. According to the IRS, Bitcoin is property that’s taxable if it’s sold for a profit. But the Commodity Futures Trading Commission has labeled it a “commodity,” and many Bitcoin users call it currency.
This week, in response to a 2013 money laundering case, a Florida judge ruled that Bitcoin isn’t money. The defendant, accused of selling Bitcoin to undercover officers for cash that they told him was obtained illegally, was arrested. During this week’s trial, Judge Teresa Pooler decided that the defendant couldn’t be charged for illegally transmitting or laundering money in return for Bitcoin: “Attempting to fit the sale of Bitcoin into a statutory scheme regarding money services businesses is like fitting a square peg in a round hole,” she ruled.
Pooler added that “Nothing in our frame of references allows us to accurately define or describe Bitcoin. [It] may have some attributes in common with what we commonly refer to as money,” she continued, but noted that there are many differences between currency and Bitcoin. She also considered the unpredictable nature of Bitcoin’s value in her ruling. “With such volatility, they have a limited ability to act as a store of value, another important attribute of money.”
All charges against the defendant were dropped.