Bitcoin is not a payment instrument, Strict Laws

Bitcoin is a payment instrument: says Espinoza:

The nature of Bitcoin is poorly understood. The latest call ruled that the sale of bitcoins required a commercial license from Florida, which overturned the verdict of the trial court that dismissed the criminal charges against Mitchell Espinoza, which had not been proven He operated a license-free service.

The trial court also dismissed the charges and concluded that bitcoin was not a "payment instrument" under Florida law and that the sale of bitcoin was not a transfer. d & # 39; money. The Third District agreed with these two conclusions and concluded that bitcoin is a "payment instrument" because the Court had evidence that individuals were willing to accept bitcoin in exchange for goods and services. .

As a result, the Court concluded that the sale of its own bitcoin included the transfer of funds, which required a license and a significant record keeping.

Florida: Bitcoin is not money

Bitcoin is not money because it lacks several basic features that people recognize and that are necessary for something to be called money. Even after that (because the word coin appears in his name), we usually talk about digital money or digital gold.

But in reality, Bitcoin is not one of those things. It is in fact a global network of computers allowing participants to authenticate the data first without obtaining the authorization of a centralized authority.

This global network is called Bitcoin with a capital "B" and the Bitcoin blockchain is the network that records and validates data entries. Before Bitcoin, secure electronic data transactions between peers were impossible because digital information is easy to copy. And also digital representations of value could be copied and spent twice. Bitcoin solves this problem by using cryptographic tools. The reward mechanism of the internal network is called bitcoin, which leads to confusion, with a tiny "b".

Users who wish to add or modify data tracked in the Bitcoin blockchain must first pay a bitcoin fee. Only they can edit or add data. There is a cost to add new data or to change existing ones.

Miners who invest their resources to check for changes to the blockchain must be able to rely on their integrity to not guarantee false data. The bitcoin reward also provides a monetary incentive to participants who only accept valid transactions.

The decision of the third district and what can be done:

The third district's opinion focuses in particular on the financial uses of bitcoin. But their analysis ignores other uses of the Bitcoin network, including a censorship-resistant publishing network, a timestamp tool, a document authenticator, a platform for a smart contract (using RSK Rootstock) with an extended application in many sectors possibility to activate forms of micro-communication (using the Bitcoin lightning network) that would otherwise be technologically impossible.

Non-financial uses require that a user get bitcoin to participate in the financial and non-financial activities facilitated by the Bitcoin network without any effort.

While ignoring the current policy that allowed individuals to sell their digital property without obtaining a state license for monetary services, the court turned Florida, which was one of the most innovative states in the industry. blockchain and virtual currency, in one of the smallest.

The decision of the Third District Court of Appeal is in balance with the Florida Office of Financial Regulation and its understanding of the many non-financial and financial aspects of the Bitcoin network.

In addition, a new bill has been introduced at the Florida House, which would form a group that will work to advise the state on other issues, including the regulation of bitcoin, and so on. Because this is a legislative solution, it can take months, if not years.