Ellie is a really cool girl, we met up and brainstormed some Bitcoin related topics a few months ago. She has been exploring the sorts of topics that would appeal to Bitcoiners for many years and in fact did some of the double spending research that came out about 12 months ago.

At the moment she seems to be working on more analysis of Bitcoin user privacy:

http://www.syssec.ethz.ch/people/ellia

Unsurprisingly, it will turn out that Bitcoin leaks private information like a sieve.

The primary issue is not with IP addresses, though that's certainly one way for information to leak.

The primary issue is with insufficient obfuscation of the block chain. Consider Joe Sixpack who receives his salary in bitcoins (for now ignore that some countries have already made that illegal). He gets one gigantic output at the start of every month and then spends it. Now anyone who happens to receive money from Joe can just trace back the transactions in a block explorer until they arrive at a salary-sized output and make the very reasonable assumption that this is how much Joe earns. Probably he would feel that this is a major privacy violation.

Bitcoin is full of these sorts of things. Fixing it is going to be a lot of work. We started already - the payment protocol is laying the foundation for resolving it and improving the privacy of the system by allowing single logical payments to be created out of multiple independent Bitcoin transactions.

I was told today that in Hungary you need approval (renewed monthly?) to pay employees in cash rather than wire transfer.

sounds legit.

(booooom)

I didn't say they'd made Bitcoins illegal. I said in some places it may be illegal to pay someone in cash without prior approval from the government. As Bitcoin is essentially electronic cash it'd most likely be viewed the same way.

I know that it's illegal to pay rent in cash in at least one country. Rent is one of the biggest sources of tax evasion. Makes sense for them to implement such laws for easily categorizable types of income, especially salaries.

ETA: I just read that Spain banned cash transactions to settle bills over 2500 EUR last year. Doubly off-topic, though still relevant I guess.

Yes you did and it is a misstatement of law.


Cash is defined under most statutes as legal tender. Bitcoin is not recognized under any statutes as legal tender and is therefore not Bitcoin is not cash.

Just because it may look like a duck and quack like a duck it still might not be a duck. There are plenty of distinguishing features between cash and bitcoins; legal tender status being the largest element.

Bitcoin is much more akin to a barter transaction than a cash transaction. Like paying salaries in apples or Farmville crops or PDFs. Can the State interfere with the freedom of contract? Sure, but so far it has not been effected in a way, although the French law cho mentions could apply (I am not familiar with French law nor its application in a Civil Code manner as opposed to Common Law) to apply to Bitcoin transactions.

Which law? I was referring to Hungarian law in my original comment, but there are similar laws in other countries. Could you call out which law I have mis-stated? You could be right, but the only way to check is to pick a specific instantiation of such laws and examine it.


In the UK Euros are not legal tender, yet the police and government will still consider them to be cash. You cannot evade laws that restrict cash transactions by simply using a different currency.

You already stated you don't actually know what the laws state in France, and I assume the same is true of Hungary. So I don't think you should be so quick to assume I'm wrong.

"money" is a term used as a laymans word for FIAT. so marcus of augustus is correct
"currency" is a term used for the category of ANY items that is used in part or in full for trade between more then 1 party, (basically widely known value point (spot)/used by more then 2 people)
EG cigarettes in prison are not money, but they are a type of currency.
"cash" is another term which many refer to being FIAT.

so the correct wording is that "it is used a virtual currency but has the properties of an asset"

in the same way that gold is not cash/money, but it used as a form of currency, but has the properties of a commodity/asset

I asked for specific laws, not some random dictionary. Besides, why do you say "only the specific sense is relevant"? What's relevant is what prosecutors can argue in front of a judge and win, as ultimately that's what would impact your personal freedom.

Here's a law that doesn't distinguish between Bitcoin and cash, it regulates the movement of cash across EU borders:

http://ec.europa.eu/taxation_customs/resources/documents/customs/customs_controls/cash_controls/r1889_2005_en.pdf


In this case "monetary instruments in bearer form" means "something like money in which physical possession is proof of ownership", which pretty much exactly meets the definition of private keys. Now as it happens, I think trying to regulate the physical movement of private keys is nonsense, but if a lawyer wanted to define Bitcoins as cash for the purposes of this law they could quite easily do so.

But there's a deeper point here. Law is not a program that can be hacked if you find a neat exploit. Judges can and often do apply a "plain reading" of the law to make their decisions, ie, they consider what the writers actually intended rather than what a machine might parse the words as meaning. There is no possible way "Bitcoin is not money" can pass this common sense test, which is why it's dumb to tell people it isn't going to be legally treated as money.