Why Florida’s ‘Bitcoin Isn’t Money’ Ruling Could Have Limited Impact
Stephen D Palley is a lawyer in private practice in Washington, DC, focusing on construction, insurance and software development, including blockchain and smart contract design.
In this opinion piece, Palley argues that a recent court case in which bitcoin was deemed not be “money” has questionable precedential value despite claims to the contrary.
A Miami, Florida, trial court recently dismissed a criminal case against a defendant who had sold bitcoin to a police detective as part of an undercover investigation.
The case, Florida v Espinosa, has been already been cited by some potentially important precedent for future cases, particularly those where bitcoin’s status as “money” or “currency” is at issue. Bitcoin industry advocates will also cite the case when arguing for legislative reform and greater regulatory clarity.
But, as legal precedent, Espinosa‘s value may be limited. It’s a single decision from a Florida state court trial judge regarding state specific statutes.
It’s not an appeals court decision. It’s not binding “precedent” in any other state or in Federal Court. Half of the opinion has to do with proving criminal intent, but little to do with bitcoin.
Finally, the Court’s analysis of whether bitcoin constitutes “money” or “currency” differs from approaches other courts have taken, and may (or may not) be adapted in other circumstances.
Precedential or not, the case illustrates how courts apply well-established legal principles and procedures to new technologies. Consider how the court reached its conclusion.
This post was published at Coin Desk on July 28, 2016.