Bitcoin emerged as leader of cryptocurrency since it was launched in 2009. In the eyes of Bitcoin users when it comes to the legal definition Bitcoin, there is still a lack of clarity. Because the lack of regulation and how the Bitcoin is seen by society that does not directly participate in the day-to-day of the currency still weighs as much for the image of bitcoin?

Different jurisdictions treat differently Bitcoin

Bitcoin is defined and used as a universal currency, bringing solutions to many problems we have with paper money, which demonstrated already be flawed and false in many occasions. In this kind of scenario, it is natural that different legal jurisdictions have a different view of what exactly is Bitcoin (https://en.wikipedia.org/wiki/Legality_of_bitcoin_by_country) . In some countries Bitcoin is not even considered legal.

The Curious Case of Michell Espinoza

On February 6, 2014 Michell Espinoza was arrested in a police operation. Espinoza was three months in jail and was accused of selling $ 1,500 worth of  Bitcoin to detectives who said he made money laundering. In July 2016, a judge in Miami-Dade decided that Bitcoin is not actually money and all charges against Michell were taken (http://www.miamiherald.com/news/local/crime/article91682102.html). The Miami Herald reported that Judge Teresa Mary Pooler, in his decision, said:

 “The court is not an expert in economics; however, it is very clear, even to someone with limited knowledge in the area, the Bitcoin has a long way to go before it the equivalent of money,”

This trial not only clarifies the Bitcoin status in Florida, but will have broader implications as well, it also means that people who were on the fence about using Bitcoin will be encouraged to use it. The lawyer Michell Espinoza - Rene Palomino told the Miami Herald:

 “At least it gives the Bitcoin community some guidance that what my client did was not illegal, What he basically did was sell his own personal property. Michell Espinoza did not violate the law, plain and simple.”

The Bitcoin debate in the United States

Different entities in the United States treated Bitcoin differently. The SEC thinks of Bitcoin as a security or money.  FinCEN (Financial Crimes Enforcement Network The) treated Bitcoin as a currency, while the IRS labels Bitcoin as property.

The ways that cryptocurrency will be taxed and used, of course, will depend on how they are seen. Mass adoption also requires clarity by the authorities at some extent. In many countries, the legal status of Bitcoin falls in the gray area and the authorities simply chose to ignore the movement of digital assets such as Bitcoin, because they do not see the volumes to have any meaning. 

In India, for example, while the central bank is interested in exploring the blockchain technology to combat counterfeiting, earlier in 2013 the central bank warned holders of virtual currencies as the press release.(https://rbi.org.in/scripts/BS_PressReleaseDisplay.aspx?prid=30247)

The press release said:

"Money in digital format are stored in digital / electronic media that are called electronic wallets. Therefore, they are prone to losses due to hacking, password loss, impairment of access credentials, malware attack etc. Since they do not are created or traded through any authorized central registry or agency, the loss of the electronic wallet can result in permanent loss of cryptocurrency ".

Although the perception of the Indian central bank seems to have changed.

What is Bitcoin?

Maybe Bitcoin is what you want it to be. People define Bitcoin according to the experiences that they live in relation to money and technology. If you are paying for things in Bitcoin, you are using it as money. If you see it as a store of value that can beat inflation, you probably see it as an asset class similar to gold and so on.

As Charles Hoskinson, CEO of Input Output Hong Kong says:

"I sort Bitcoin as a digital merchandise. It has a great value property store, but makes a bad unit of account by means of an exchange. Commodities like gold usually have this property."

What should shape the future of Bitcoin is precisely the debate and decisions concerning the regulation and classification of Bitcoin. We all know that innovation is stifled by old system. Humans have great difficulty in leaving the old stuff back and live the future.