Is Crypto Gambling?

The price of STEEM fluctuates in an unpredictable relation to fiat currency. There are many competing cybercurrencies. I suspect that most of these will fail. Every penny invested in STEEM or any of these schemes is at risk.

As there is risk involved one can properly say that investing in crypto is a gamble.

I live in Utah.

Utah strictly prohibits "fringe gambling." Even touching a token related to gambling can be interpreted as fringe gambling. BTW, you can't buy lottery tickets in Utah. It is illegal for me to ask someone in another state to buy a ticket.

Accessing web sites like BigFishGames.com is illegal in this state. Here is the current criminal code.

The code concentrates heavily on "fringe gambling."

STEEM is a "Smart Media Token" that conveys a "representation of value." Accessing SteemIt in the Beehive State could be construed as a gambling.

Actively participating in SteemIt.com could be considered "fringe gambling." Many of the "contests" on SteemIt are clearly fringe gambling.

Do you know anyone who has lost money or even someone who claims to have lost money on SteemIt?

A person who claims to have lost money would have a pretty good change of winning a lawsuit against anyone who provided access or encouraged use of SteemIt.com in Utah.

The group that runs Utah is notoriously oppressive.

Bitcoins is not the first application that used tokens that represent value. There have been numerous companies through the years that attempted to create tokens that represent values.

This is especially true in the actual gambling industry where people buy chips and play games in casinos.

There have been numerous web sites offering virtual casinos. These sites routinely run afoul of gaming laws.

Many sites like BigFishGames and GameDesire allow people to buy chips, but won't let people cash out chips.

Even though it is impossible to win money on these sites, people can lose money and so they are illegal.

So, how exactly does a state determine if an activity is "fringe gambling." Well what happens is a prosecutor (or other publicity hound) launches a lawsuit?

Defending against a lawsuit is extremely expensive.

If a case goes to a jury and a person talks about how they lost a hundred dollars by buying STEEM; the jury is apt to rule for the plaintiff.

As suggested in previous posts, I am interested in developing educational games that explore aspects of the market. The games would have tokens and exchanges. The goal of the games would be to explore how markets functions.

In a free market, prices vary.

I should point out this section of Utah Criminal Law:

"Gambling" means risking anything of value for a return or risking anything of value upon the outcome of a contest, game, gaming scheme, or gaming device when the return or outcome:
(i) is based upon an element of chance; and
(ii) is in accord with an agreement or understanding that someone will receive something of value in the event of a certain outcome.

Prices vary in a free market. Creating a simulation of an exchange would involve cyber tokens and variable pricing.

Risk is in the very nature of the free market.

A computer system which models or interacts with the free market is illegal in Utah.

This state really is an intellectual hell hole.

Anyway, I've been sitting here wondering if I should create an application that accesses the STEEM blockchain.

Just as accessing BigFishGames is illegal in this state. I am not sure if accessing SteemIt.com is legal. Developing an application that accessed the STEEM blockchain could open me up for lawsuits and jail time.

Which brings up the genius of the blockchain. Bitcoin is not the first company that created a media token. The companies that developed such tokens kept running afoul of regulations. Bitcoin took the distributed filing system from Napster, added encryption and made a blockchain in a way that it is difficult for the authorities to sue.

The image for this post was drawn by Thomas Wright in 1871 and is available as an SVG file on OpenClipArt.com