|THE BITCOIN COMMUNITY DISAGREES ON WHAT HAPPENS NEXT|
Aruba, September 22, 2015 - What is Bitcoin? Is it property, something to be owned? Is it a currency, something to be spent? Or is it a commodity, defined by Webster’s Dictionary as “any useful thing,” and/or “anything bought and sold; any article of commerce.”
The U.S. Internal Revenue Service thinks bitcoin is property; a federal judge thinks it's a currency; now the Commodity Futures Trading Commission (CFTC) has decreed it a commodity. That means the regulator can now bring charges against any wrongdoers trading cryptocurrency futures and options.
In a statement, the CTFC’s Director of Enforcement, Aitan Goelman, said:
“While there is a lot of excitement surrounding Bitcoin and other virtual currencies, innovation does not excuse those acting in this space from following the same rules applicable to all participants in the commodity derivatives markets," said Aitan Goelman, the CFTC's director of enforcement of the decision.”
Does the ruling change the fundamental nature of what Bitcoin is, and how its advocates will use and develop it? We asked leading members of the bitcoin community for their views.
The Developer: ‘A Bizarre Ruling That Will Be Challenged’
“There are so many regulators in the U.S., and they all want more jurisdiction, which leads to a constant stream of bizarre rulings. None of them has much work to do because there’s not a whole lot of financial innovation happening in the States. So when they find a small one-man startup they can’t resist giving themselves work to do – so they go in and whack it, especially in California.
“I’m not terribly surprised and not terribly worried. I think the CFTC has a very weak case here and it’s a very creative reinterpretation of what the word commodity means. The ruling will be challenged and judges will apply common sense and decide it to be a currency" as happened in the Silk Road case.”
- Mike Hearn, software developer specializing in Bitcoin
The Researcher: ‘Don’t Take it Out of Context’
“This ruling is obviously very consequential to U.S.-based Bitcoin futures trading platforms, but it’s important not to overplay the implications. Last year, the U.K. tax authority ruled that Bitcoin is a currency. Last month a Japanese judge ruled that Bitcoin is not property. These rulings concerning what Bitcoin is or is not are for certain purposes only, but they often get taken out of context.”
- Vili Lehdonvirta, Research Fellow at the Oxford Internet Institute
The Exchange Founder: ‘It Will Send Companies Offshore’
“In the U.S. there are regulators that look at Bitcoin from their own perspective and just arbitrarily make up a rule or guidance. New York regulates it as a currency, for example. It’s just not sensible. If this ruling does affect anyone, they’ll just move to offshore jurisdictions.
“Bitcoin has many uses – sometimes it’s used, traded as a commodity but it’s also used as a currency and a technology.”
- Gareth Grobler, founder of the IceCUBED Bitcoin exchange
Read more at: http://www.bloomberg.com/news/articles/2015-09-18/the-bitcoin-community-disagrees-on-what-happens-next