(CoinDesk) With the US Senate setting 18th November as the start date for its committee hearings into bitcoin, it’s time to
take a look at some of the more significant events in bitcoin’s short but colorful legal history.
The early Bitcoin timeline featured hacks, heists, drugs, demands for refunds and the first appeals to law enforcement, but 2013 saw official scrutiny rise almost as quickly as bitcoin’s value.
Whether or not bitcoin requires, or should seek, regulatory approval is a major source of heated debate on bitcoin discussion forums, but the regulation issue will remain prominent as long as significant amounts of wealth are at stake.
FinCEN issued guidelines that bitcoin-related businesses counted as “Money Service Businesses” (MSBs) under US law.
This meant bitcoin businesses were now officially required to provide authorities with information about potentially suspicious transactions and introduce policies to prevent money laundering. These regulations also affect the more centralized virtual currencies and point systems used in social networks and online games, including Facebook and Second Life. Lack of a centralized authority meant bitcoin itself could not comply, but any business associated with its use would need to — including individual miners, if they converted their bitcoin to fiat currency.
In something of a rare public compliment for bitcoin from the world of traditional finance, François R. Velde, senior economist of the Federal Reserve in Chicago wrote a glowing paper titled “Bitcoin: A Primer” in which he wrote bitcoin was a “remarkable conceptual and technical achievement, which may well be used by existing financial institutions.” He further described bitcoin as an “elegant solution” to the digital currency problem and claimed its value derived from certain beliefs about the nature and function of money, and the amounts of fiat currencies traded for it.
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