By Stephanie Liao
The debate over whether Bitcoin is real money continues to rage on after a court’s decision in the Southern District New York ruled that the crypto currency is considered “real” money.
Bitcoin is a digital currency and payment system that was created by an unidentified software programmer known as Satoshi Nakamoto. Bitcoin offers consumers lower transaction fees than traditional online payment mechanisms. It is operated by a decentralized authority but can be bought and sold through regulated services such as CoinBase.
Prosecutors charged Anthony Murgio with money laundering and control over the operation of Coin.mx, an unlawful Bitcoin exchange site. The alleged scheme generated hundreds of millions of dollars of profit through pumping up stock prices, online casinos, money laundering and other illegal activities.
Murgio sought to dismiss two of his charges by arguing that Bitcoins are not considered “currency” under United States law. During the beginning stages of his case, a Miami judge ruled that Bitcoin did not meet the legal definition of money because the virtual currency was not considered “tangible wealth” and “cannot be hidden under a mattress like cash and gold bars.”
However, the New York U.S. District Judge rejected the bid by Murgio, stating in her opinion that “Bitcoins are funds within the plain meaning of that term. Bitcoins can be accepted as a payment for goods and services or bought directly from an exchange with a bank account. They therefore function as pecuniary resources and are used as a medium of exchange and a means of payment.” Judge Nathan further supported her findings by examining the legislative history of Section 1960 – Prohibition of Unlicensed Money Transmitting Business. Section 1960 was enacted to address the fact that “money launderers with illicit profits ha[d] found new avenues of entry into the financial system.” Since then, Section 1960 has sought to prevent innovative ways of transmitting money illicitly. Accordingly, Section 1960 “appl[ies] to any business involved in transferring ‘funds…by any and all means.’” Under the definition, Bitcoins are considered funds.
There is still no clear consensus from the U.S. government entities over whether Bitcoin is considered legal tender in the same vein as the dollar. The U.S. Commodity Futures Trading Commission classifies Bitcoin as a commodity, while the Internal Revenue Service (IRS) has previously defined the crypto currency as an asset. As the currency grows in popularity, there could be more pressure for businesses to accept Bitcoin as payment. However, with the uncertainty of Bitcoins, one could accept a Bitcoin as payment today, and it could be half the value tomorrow. It is a very dangerous and risky way to do business. Bitcoin could be the future of currency, or it could just be a trend. The decision continues to incite debate amongst observers and has sparked renewed effort in state legislatures to develop regulations around digital currency.
 See generally United States v. Murgio et. al., No. 15-cr-00769, 2016 WL 5107128 (S.D.N.Y. Sept. 19, 2016).
 Who is Satoshi Nakamoto?, CoinDesk (Feb. 19, 2016), https://www.coindesk.com/information/who-is-satoshi-nakamoto/
 United States v. Murgio at *2.
 See generally Florida v. Espinoza, No. F14-293 (Fla. Cir. Ct. July 22, 2016).
 United States v. Murgio at *4-5.
 S. Rep. No. 101-460 (1990).
 18 U.S.C. § 1960(b)(2) (2016).
 United States v. Murgio at *4.
 Jacob Bogage, Bitcoin’s not money, judge rules as she tosses money-laundering charge, The Washington Post (July 26, 2016), https://www.washingtonpost.com/news/morning-mix/wp/2016/07/26/bitcoins-not-money-judge-rules-as-she-tosses-money-laundering-charge/.