Topic: Bitcoin becomes 100% unregulated in Japan!!! (Read 3976 times)

Oh wow this is awesome thank for this information.

and now, let's see if the bitcoin rises again.
yay we have support from japan!

imho its what most bitcoiner want: self-responsibility
personally i like that judgement. but you are right in saying that its only one judge.

most countries do have laws which forbid hacking which includes liability for any damage.

 I don't know if I would call this a big victory.  This is one judge saying that a bitcoin case won't be recognized by the court.  In my opinion, it's slap in the face to bitcoin.  I don't think it sets any sort of precedent as far as bitcoin businesses being sanctioned by the government.  Perhaps the opposite. 

that's right, the same as the previous quote, which states that if there are no rules in using bitcoin, bitcoin can be used for things that are negative, such as drug deals

I think that this is not a good choice and good thing for bitcoin. Because in this way bitcoin can be subject of speculation and misuse of it. The best it would be to be regulated and to be under law equally to the other subjects under law. Equally to yen. In this way can be more trust on it even from the simple people.

What do you not trust about your bitcoin transactions that you believe the government could improve?

wow it was incredible japan
but, do it all without the law, it can be made as transaksi negative

Mt. Gox, once the dominant exchange for bitcoin trading, on Friday said more than $470 million of the virtual currency vanished from its digital coffers, kicking into high gear a search for the missing money by victims and cybersleuths.

Bitcoin exchange Mt. Gox said it was filing for bankruptcy protection and that 750,000 of its customers' bitcoins had been lost. Is the end of the crypto-currency or merely growing pains? Columbia Business School assistant professor Moshe Cohen discusses on MoneyBeat.
Acting alone and in groups, the people stepped up their efforts after Mt. Gox filed for bankruptcy protection in Japan and confirmed rumors it had lost almost 750,000 of its customers' bitcoins, as well as roughly 100,000 of its own.

Mt. Gox Chief Executive Mark Karpelès said technical issues had opened the way for fraudulent withdrawals, though he didn't provide details.

"There was some weakness in the system, and the bitcoins have disappeared. I apologize for causing trouble," Mr. Karpelès said at a packed news conference at a Tokyo courthouse after the bankruptcy filing.

The disappearance underscores the risks of currencies that exist only online and aren't backed by a central bank. Mt. Gox wasn't overseen by national regulators, so there is no entity to step in and back investors' deposits.

BITS AND PIECES

View a a rough timeline of the Bitcoin evolution.

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It wasn't clear whether or how the missing bitcoins would be found. Bitcoin's underlying software code, known in developer circles as "the protocol," is believed to keep track of every transaction using a special marker that can be traced via an online ledger.

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Unlike cash, which might be difficult to track if it is stolen from a bank vault and then widely dispersed, bitcoin transactions are logged in the ledger, which essentially can be accessed by anyone with a computer.

Some computing experts believed any hackers might be capable of covering the tracks of a potential computer break-in. But if each bitcoin has a marker, it would make it more difficult for thieves to try to convert a big stash into another currency, in the same way it would be difficult for an art thief to pawn off a pilfered Matisse painting quickly.

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Those factors are giving hope to the wave of Mt. Gox victims and treasure hunters who have fanned out in search of the missing bitcoins. The virtual currency that disappeared represents nearly 7% of all bitcoins in circulation.

Devon Weller, a 40-year-old freelance Web developer in Nashville who said he had a "small amount" of bitcoins stashed at Mt. Gox, tossed aside his regular work Friday morning to start looking for missing bitcoins. He tapped into the public ledger from his home office and started following the trail of large transactions.

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"I haven't gotten very far, but it's one of those things that is going to eat away at me," said Mr. Weller.

The exchange's bankruptcy filing capped a tumultuous stretch for the five-year virtual currency. One bitcoin traded at about $549 late Friday, based on the CoinDesk price index of two leading exchanges. The value of a bitcoin started 2013 at about $13, soared above $1,100 in December and has since lost about half its value.

The price swings have hit some investors hard. Fortress Investment Group LLC on Friday recorded an unrealized loss of $3.7 million from its purchase of $20 million worth of bitcoins last year. The asset-management firm held $16.3 million worth of bitcoins at the end of 2013, according to a filing with the U.S. Securities and Exchange Commission.

Mt. Gox halted customer withdrawals three weeks ago, saying a "bug in the bitcoin software" allowed some users to alter the ID on transactions and fraudulently claim that bitcoin transfers hadn't been sent. Other exchanges also had problems but were able to provide patches so activity could resume.

Mt. Gox didn't recover, and it shut down operations Tuesday.

The defunct exchange is the target of an investigation by the U.S. attorney's office for the Southern District of New York. The scope of the probe isn't clear, but prosecutors have subpoenaed the company, ordering it to preserve certain documents, according to a person familiar with the matter.

Mt. Gox also faces lawsuits from customers. On Thursday, a customer who claims to have $25,000 worth of bitcoins tied up at Mt. Gox filed a lawsuit seeking class-action status against the exchange. Gregory Greene, who filed the claim with an Illinois District Court, is seeking damages, an injunction, restitution and other remedies.

The claim alleges that Mt. Gox, its holding company and Mr. Karpelès are guilty of consumer fraud by engaging in "unlawful, deceptive, and unfair conduct that is immoral, unscrupulous, and causes substantial injury to consumers." It claims Mt. Gox falsely represented to its customers that it would "protect their bitcoins and fiat currency and safely and quickly allow them to buy, sell, trade, or withdraw the same at any time."

A covered Bitcoin sign is hung outside a Bitcoin cafe which was scheduled to open in March at the building housing the company operating the Mt. Gox Bitcoin exchange in Tokyo, Japan. ENLARGE
A covered Bitcoin sign is hung outside a Bitcoin cafe which was scheduled to open in March at the building housing the company operating the Mt. Gox Bitcoin exchange in Tokyo, Japan. BLOOMBERG NEWS
The company didn't immediately respond to a request for comment.

Because Mt. Gox was unregulated, customers might not have much recourse unless they hunt down missing bitcoins on their own. By contrast, customers of MF Global Inc., a regulated brokerage, have nearly been made whole after they lost an estimated $1.6 billion in its 2011 collapse. U.S. customers who traded on U.S. exchanges have received about 98% of their funds, while U.S. customers who traded on foreign exchanges have received about 78%.

Federal regulators have encouraged bitcoin companies to follow money-laundering rules, but beyond that have generally been silent on whether they have legal authority to regulate companies like Mt. Gox in the future or set up rules that would protect bitcoin users. The Consumer Financial Protection Bureau and the Federal Trade Commission have held meetings in recent weeks to study the issue.

Market regulators including the SEC are still evaluating whether bitcoin falls under their jurisdiction. Agencies that oversee banks and payment systems are monitoring bitcoin, but Federal Reserve Chairwoman Janet Yellen said this past week that the Fed has no authority to regulate the virtual currency as long as it "doesn't touch" banks the Fed oversees.

Bitcoin enthusiasts are teaming up to pursue the cybertrail of the missing cash. Among them is Charles Shrem, a prominent bitcoin advocate and entrepreneur who was arrested in January and charged with money-laundering in connection with his bitcoin company.

Mr. Shrem, who worked with four others, said they might have discovered 90,000 of the missing bitcoins that still appear to be in the Mt. Gox coffers, despite the exchange's claim that the money is gone. He added, however, that it is a working theory and still speculative.

"We did it for the community," said Mr. Shrem, who is under house arrest and has pleaded not guilty.

ENLARGE
Gavin Andresen, chief scientist for the Bitcoin Foundation, a trade group, isn't hopeful that amateur sleuthing will turn up the missing bitcoins. The best results, he says, might come from a far more traditional source.

"I wouldn't be surprised, if there is a theft involved here, that eventually law enforcement does figure out, using the subpoena powers, where the bitcoins went," he said.

But Adam B. Levine, who worked with Mr. Shrem, said he is optimistic. "There's lots of threads to follow, and if you start pulling on one thread, it exposes another, and eventually you start building a map," he said.

Mr. Levine, a writer at Letstalkbitcoin.com and a self-taught bitcoin sleuth, said his team formed its plan during "a 36-hour Skype call."

He was supposed to appear at a conference on March 6 but has decided to cancel his appearance.

"I should been preparing to give my speeches," he said, "but this thing is taking all day."

—Michael Casey, Neelabh Chaturvedi and Ryan Tracy contributed to this article.

Write to Eleanor Warnock at [email protected], Takashi Mochizuki at [email protected] and Alexander Martin at [email protected]

the fact that does not do taxes its very irregular to become japan accepted they need measures further.

What counts in this case is the japanese judge who could feel beeing disrespected and not how Marc could defend himself afterwards. In reality Marc can only bow and shut the fuck up. Trying to bribe a japanese judge in his situation is the dumbest thing he could try.

And is something I can take. If law does not acknowledge bitcoin as something to stand for then I want it to stop charging ANY bitcoin tax.
Bitcoin should be totally unregulated, no support from government = no taxation and free market without boundaries.

Then he just says he didn't offer him anything since it's intangible.

lol Japan always out in front of the technology waves

Imagine what happens when he makes this offer to the judge and he doesn't like it ....

Same could be said about your bank account.


Remember this.... MtGox was operarting as an exchange business. It does not matter if the ownership of btc can be proven or not, just like you can't prove a particular shares/stock is owned by you, the stock exchange still promise you a share of a company. Thats a contract.

does this means japan is going to become the hub of illegal usage of bitcoins next ? 

I think the judge is correct in that bitcoins aren't property.  If you think about it bitcoins don't actually exist , its just entries in a ledger .  How do you prove ownership on a entry in a spreadsheet.  If I give my private keys to 10 other people does that mean we all joinly own the BTC, what makes it more my vs theirs?  We all have equal access.  Bitcoins are going to change the way people view property and its going to be a source of debate for many years.

How is the IRL merchant adoption in japan? I wish It was big so I could make a visit to japan, always wanted to visit that place, and I wouldn't need to pay for fees to convert the money, I could pay directly with btc using the phone.

Since the collapse, various legal proceedings have kicked-off. These proceedings will likely result in important precedents being made in regards to Bitcoin, which is still a gray area as far as the law is concerned. Any decisions made now could have a big impact on cryptocurrency in the future, setting precedents for the emerging area of digital currency law

so for them it's like exchanging seashells or something? well now i know where to go, if things turn too bad in Europe about bitcoin, but at least for us they promised the exemption of vat for bitcoin...

That could be a possibility, if he is truly the one who stole it.
Has anyone seen any of those coins move?
I haven't been following the case much.

As far as i can tell.. in Indonesia too..
our regulator could not accept bitcoin as a commodity..
don't know what will they decide in the future though..
in one of the biggest bitcoin exchange in Indonesia, the money cycle reaches 8,000 BTC monthly roughly around 28,000,000,000 IDR/Month.. maybe the need to regulate things up..

tux using the stolen btc to bribe the judge?

even in the US there are different levels of court... different types of courts too.. and trust me.. a civil court has no power to overturn laws.. thats more like criminal court.. and as for regulation changes.. thats for something you lot call supreme courts. or senates..

but the little courts you find in each of your towns that only deal with fines and compensation, known as civil court.. is as i said, powerless in regards to the national stuff..

Wow, what country do you live in? I live in the U.S., and the courts here can do whatever they want, literally, and without limit. They regularly overturn laws and create new ones, and if the people or the legislatures attempt to craft new laws they just strike them down or ignore them. (Apparently millions of people or hundreds of legislators are incapable of judging whether something is constitutional or not, but one or a handful of judges can.) It's made a mockery of the notion that the U.S. has representative government.

Definitely, I am sure the Yakuza wont mind



I too am very curious to see how this unfolds.



Use multisig?

I don't see any difference with what is already happening with regards to that matter.
And that is, exchanges claiming they have been "hacked", if you know what I mean

This change came after the MtGox fiasko, so what laws existed at the time it happened? ....Surely those laws are applicable to the MtGox case. Is this change back dated?

* The yakuza pachinko games are not defined as gambling... It closely resemble the principle where kids play arcade type games for tokens, and these tokens can be exchanged for toys and sweets.

How lucky can one guy be? ---> Mark Karpeles .... This surely opens up a world of opportunities for criminals to exploit this loophole in Japan. 

wouldnt this make people use bitcoin in a bad way to ?  but yea all in all its good thing .. atleast some country is understanding how it works

the little snippet in the news has been over exaggerated.. judges do not create regulations.. governments do.
in civil court its meaningless to even pretend that what a judge says will change anything, they just dont have the power.

the real story has nothing to do with japanese regulation, past or future.. it just means a guy lost the case because he couldnt make the judge understand how accountable kerpeles was.

 

Wow, this is great news, good work Japan! Way to move a massive step in the right direction and thanks for sharing the article.

After witnessing what happened with Mtgox i would think everyone would be running away from unregulated exchanges in Japan.

That is a strange ruling, the court must not have the laws and mechanisms to cover it
Off to the government it goes.

Most probably a retarded first instance judge.

I wish I could read the original ruling in Japanese. There's something wrong here. There are intellectual property laws in Japan. Companies pay big money to get their technical findings protected by patents. Brand names are protected too, so it seems strange that no law should be applicable to BTC, if that judge doesn't see it as a currency. Then we shall not see this as a big event. The Japanese government may choose to regulate BTC at some time, and that would change that ruling.

I'm thinking that this ruling has more to do with paving the ground to introduce total bitcoin regulation.

I dont know Japanese law, but rulings like this define the object in question (BTC) so that they can target the 3rd parties related to it (exchanges, etc)

this isnt an open and shut thing... its the start of a tsunami of legislation.

anyways..."ongoing" and watched closely...

How can they see it has having no value when 1 unit of the Bitcoin network is universally valued at 280 USD? What is this sorcery? I surely don't get it. Does it mean you can cash out in japanese yen without fearing you will get investigated by mr taxman? I just dont get the rammifications of such claim.

That makes absolutely no sense at all.

Please stop dreaming. If the court ruled that the plaintiff cant not seek the same amount of btc back, it means btc has no value. Dont try to twist it around.

I dont see how you think this is about fungible. Commodity or not, the court would have ruled the plaintiff his loss.

As usual, Coindesk has it wrong. See the Japan Times article. This is just a ruling that Bitcoins are fungible. Someone brought a lawsuit demanding the return of the Bitcoins they deposited, as specific items of property. That works if you lent someone a car and they went bankrupt. But not if you lent them, say, a delivery of fuel oil which then went into their tank. This is just a ruling that Bitcoin is more like a commodity than an object.

I suspect along time ago that mtGox mystery incident is related to underground clan. I mean Mark might just be a puppet

If you guys dont know about Japan, its culture is very much tighten to mafia clans, from politics to lifestyle. Notice all the underground activities like Gambling , prostitution happen every where in Japan? Even city Major elections are funded by clans.

Mark would not dare to stay in the open if he was not protected by a clan.

I think it is covered. It will fall under assets/properties as a catchall.
This Judge just messed up and made an incorrect decision that will be easily overturned.
The Judge just got confused with the Bitcoin System and the Plaintiff(s) didn't properly argue.

Use escrow services, multi-sig, all sorts of technology that make laws meaningless...

Soon world will follow Japan.

But then again, what happens if you can't pursue third party services for stealing your bitcoins, overcharging etc. I don't see Japan being a good place to start a bitcoin related business after this.

plus the fact a banker probably wrote wat he said

and also told him how high to jump

but ill give him the benefit of the doubt 

Can't really nitpick the wording too much since most likely the original wording is in Japanese.

if fiat is tangible crypto is super tangible so not sure if stupid or trolling

I wonder what this means for Bitcoin claims in the MTGox liquidation.

Reliance on third party? What is that guy talking about? Bitcoin does not need any 3rd party validation.
So wild wild west in Japan regarding Bitcon?!
And what about Mt.Gox? What influence will this decision have?

well that's pritty cool but I think its also unregulated in india too.because no one really knows about it till now..I mean to say many  peoples in india don't belive in this..system and are not even trying it because most of them thinks its scam or just a common trick which will just waste their time

Does it not say "current laws" ie we might need some emergency new laws to cover it. Leverage, leverage, Fear, Leverage

Yeah, that's why pachinko parlors are allowed. YOu're gambling with pachinko balls, which called be exchanged back for real money.


You can only get little trinkets, which you then go to the back alley and exchange it for money with the yakuza.

Freedom is good, but has its downsides too. Most people are not very adventurous with their money, I think that in Japan they are even more conservative, so bitcoin adoption is likely to suffer due to this.

Although it could be just the other way around, you never know!

If Bitcoin cannot be covered under the existing law then Mark Karpeles cannot be prosecuted for stealing all those Bitcoins under the existing law. He can only be prosecuted for embezzling the fiat from customer's accounts. I'm eager to hear what they will charge him with. If he doesn't get charged for stealing Bitcoins then there will be a huge influx of Bitcoin exchange hackers into Japan.

The judge seems (in my ignorant opinion) to be making a convoluted argument to arrive at a predetermined conclusion hostile to bitcoin. For instance, ownership of real estate is dependent on 3rd parties that record and store the deed for legal purposes. If those deeds became electronic (set into a blockchain as Honduras is doing) does that mean in his view that real estate would not be property because the deeds are intangible and dependent on 3rd parties? What about ownership of written works in an electronic format? Authors, musicians and others are creating property that has real value every day, that is both physically intangible (recorded digitally) and dependent on other parties (the whole internet ecosystem and everything necessary for it) for their value and usability.

As Elwar adroitly points out, this doesn't shut the door on bitcoin, it just creates anarchy (with no legal recourse for those who are wronged under Japanese jurisdiction). I doubt it will stand for long though, as it is just too contrary to empirical realty.

Hmm, gambling with something that they see as having no value...I guess it would be allowed. Don't quote me on that though.

Does this mean that you can freely open bitcoin casinos in japan, a country where gambling is strictly illegal except yakuza pachinko parlors?

If you're relying on the government to protect you when it comes to using Bitcoin, you're doing it wrong.

So anyone can do anything with bitcoin in Japan and not get arrested? Is this what this is saying? May need top stop using or not use any service/site hosted or out of Japan if it is related to Bitcoin.

does this mean anything for the mtgox trial?

The only thing you need to own a bitcoin is to hold the private key. The government cannot do anything to change that basic fact.

Does this mean all bitcoin activity is untaxable? If so I can see lots of people taking advantage of that loophole. Surely Japan have fucked themselves over here?

So with no ownership over bitcoin, I'd expect cryptocurrencies to never be widespread in Japan. Then again, we don't know hoe valid this order is and how seriously is going to be regarded.

Can someone explain what he means by "reliance on third parties"?  Is he referring to the fact that bitcoin requires nodes and miners in order to transact? Or is he pointing out that most people use 3rd party wallet providers?

http://www.coindesk.com/tokyo-court-bitcoin-not-subject-to-ownership-2/


This is quite awesome. Set up exchanges, set up payment processors, set up whatever you want with Bitcoin in Japan. It is not covered under the law.