Bitcoin: Legal Definition and Its Place in Legal Framework

Abstract

Present paper explains role of the Bitcoin and its involvement in economic activity worldwide, using practical examples of real business models, reflects the modern views of legislators and judicial bodies on local (selective countries legislation and court practice) and international level (European Union legislation and international court practice), which are formed after Bitcoin’s fast widespread in 2012. Current research examines in details various definition of the Bitcoin, used by legislators to place Bitcoin in already existing legal frames – virtual money, property, commodity or financial instruments, which has significant importance to legislators worldwide to regulate business activity related to Bitcoin: licensing of institutions issuing Bitcoin, if it is defined as virtual money; Bitcoin’s place in stock market, if it is defined as security or financial instrument; or transfer of property rights, if Bitcoin is defined as commodity or property. Moreover this paper underlines importance of amendments acceptance, based on certain Bitcoin’s definition, to prevent money laundering, financial support providing to terrorism, to straighten financial market and consumer protection procedures.