He is a little more clarity from an actual attorney!
https://bitcointalksearch.org/topic/m.2884525
Topic: 2013-08-06 " Bitcoin can be used as money" (Read 951 times)
My edit was just correcting the title, changed "2019" to "2013"
"It is clear that Bitcoin can be used as money," the judge wrote. "It can be used to purchase goods or services."
U.S. Magistrate Judge Amos L. Mazzant
United States District Court for the Eastern District of Texas
http://www.law360.com/articles/462977/bitcoins-are-currency-subject-to-securities-laws-judge-says
Bitcoins Are Currency Subject To Securities Laws, Judge Says
Share us on:TwitterFacebookLinkedInBy Kat Greene 0 Comments
Law360, Los Angeles (August 06, 2013, 9:03 PM ET) -- Internet-traded bitcoins are a form of currency subject to federal securities laws, a Texas federal judge ruled Tuesday, refusing to dismiss the U.S. Securities and Exchange Commission's claims accusing the founder of Bitcoin Savings & Trust of running a Ponzi scheme.
Bitcoin is a form of currency because it can be used to purchase goods or services and exchanged for more traditional forms of money, U.S. Magistrate Judge Amos L. Mazzant wrote in a decision Tuesday.
Bitcoin Savings & Trust sold investments denominated in the online currency promising high returns, but paid the new investment money as interest returns on older accounts, according to the SEC. Because bitcoins are a security, the alleged fraudster is subject to federal securities laws against the Ponzi practice, Judge Mazzant wrote Tuesday.
“It is clear that Bitcoin can be used as money. It can be used to purchase goods or services,” Judge Mazzant wrote in the decision, rejecting the company's bid to dismiss the suit for lack of subject matter jurisdiction. “The court finds that the [Bitcoin Savings & Trust] investments meet the definition of investment contract, and as such are securities.”
The SEC launched its lawsuit in Texas federal court July 23, accusing Bitcoin Savings & Trust and its founder Trendon T. Shavers of defrauding investors in a Ponzi scheme involving bitcoins. The complaint alleges Shavers offered and sold bitcoin-denominated investments through the Internet and raised least 700,000 bitcoins, which the SEC says amounted to more than $4.5 million based on the average price of bitcoins in 2011 and 2012, when the investments were offered and sold.
The SEC claims Bitcoin Savings & Trust, formerly known as First Pirate Savings & Trust, was a sham and a Ponzi scheme in which Shavers used bitcoins from new investors to make purported interest payments on outstanding investments, according to the complaint filed July 23.
The SEC says Shavers promised investors up to 7 percent weekly interest based on Bitcoin Savings and Trust’s bitcoin market arbitrage activity, which supposedly included selling to individuals who wished to buy bitcoins “off the radar” in quick fashion or large quantities.
Instead, Shavers used the new investments to make interest payments and cover investor withdrawals on outstanding Bitcoin Savings & Trust investments. Shavers also diverted investors’ bitcoins for day trading in his account on a bitcoin currency exchange, and exchanged investors’ bitcoins for U.S. dollars to pay his personal expenses, according to the complaint.
Shavers argued that his bank wasn’t subject to the securities laws that prohibit the Ponzi scheme, urging dismissal of the case on the grounds that he wasn’t dealing in real currency.
But Judge Mazzant disagreed, writing in Tuesday’s order that the investments met all the requirements of an actual investment security and were therefore subject to the laws. The judge denied Shavers’ motion to dismiss the suit.
Representatives for the SEC and Shavers did not immediately respond to requests for comment Tuesday.
Shavers is representing himself.
The case is U.S. Securities and Exchange Commission v. Trendon T. Shavers et al., case number 4:13-cv-00416, in the United States District Court for the Eastern District of Texas.
--Additional reporting by David McAfee. Editing by Elizabeth Bowen.
U.S. Magistrate Judge Amos L. Mazzant
United States District Court for the Eastern District of Texas
http://www.law360.com/articles/462977/bitcoins-are-currency-subject-to-securities-laws-judge-says
Bitcoins Are Currency Subject To Securities Laws, Judge Says
Share us on:TwitterFacebookLinkedInBy Kat Greene 0 Comments
Law360, Los Angeles (August 06, 2013, 9:03 PM ET) -- Internet-traded bitcoins are a form of currency subject to federal securities laws, a Texas federal judge ruled Tuesday, refusing to dismiss the U.S. Securities and Exchange Commission's claims accusing the founder of Bitcoin Savings & Trust of running a Ponzi scheme.
Bitcoin is a form of currency because it can be used to purchase goods or services and exchanged for more traditional forms of money, U.S. Magistrate Judge Amos L. Mazzant wrote in a decision Tuesday.
Bitcoin Savings & Trust sold investments denominated in the online currency promising high returns, but paid the new investment money as interest returns on older accounts, according to the SEC. Because bitcoins are a security, the alleged fraudster is subject to federal securities laws against the Ponzi practice, Judge Mazzant wrote Tuesday.
“It is clear that Bitcoin can be used as money. It can be used to purchase goods or services,” Judge Mazzant wrote in the decision, rejecting the company's bid to dismiss the suit for lack of subject matter jurisdiction. “The court finds that the [Bitcoin Savings & Trust] investments meet the definition of investment contract, and as such are securities.”
The SEC launched its lawsuit in Texas federal court July 23, accusing Bitcoin Savings & Trust and its founder Trendon T. Shavers of defrauding investors in a Ponzi scheme involving bitcoins. The complaint alleges Shavers offered and sold bitcoin-denominated investments through the Internet and raised least 700,000 bitcoins, which the SEC says amounted to more than $4.5 million based on the average price of bitcoins in 2011 and 2012, when the investments were offered and sold.
The SEC claims Bitcoin Savings & Trust, formerly known as First Pirate Savings & Trust, was a sham and a Ponzi scheme in which Shavers used bitcoins from new investors to make purported interest payments on outstanding investments, according to the complaint filed July 23.
The SEC says Shavers promised investors up to 7 percent weekly interest based on Bitcoin Savings and Trust’s bitcoin market arbitrage activity, which supposedly included selling to individuals who wished to buy bitcoins “off the radar” in quick fashion or large quantities.
Instead, Shavers used the new investments to make interest payments and cover investor withdrawals on outstanding Bitcoin Savings & Trust investments. Shavers also diverted investors’ bitcoins for day trading in his account on a bitcoin currency exchange, and exchanged investors’ bitcoins for U.S. dollars to pay his personal expenses, according to the complaint.
Shavers argued that his bank wasn’t subject to the securities laws that prohibit the Ponzi scheme, urging dismissal of the case on the grounds that he wasn’t dealing in real currency.
But Judge Mazzant disagreed, writing in Tuesday’s order that the investments met all the requirements of an actual investment security and were therefore subject to the laws. The judge denied Shavers’ motion to dismiss the suit.
Representatives for the SEC and Shavers did not immediately respond to requests for comment Tuesday.
Shavers is representing himself.
The case is U.S. Securities and Exchange Commission v. Trendon T. Shavers et al., case number 4:13-cv-00416, in the United States District Court for the Eastern District of Texas.
--Additional reporting by David McAfee. Editing by Elizabeth Bowen.
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