Of course bitcoin isn't money by law and therefore this can't be considered "Money laundering"
This is patently NOT true.
Bitcoin according to FinCEN is "other value that substitutes for currency" as per FinCEN's FINAL RULE: Bank Secrecy Act Regulations; Definitions and Other Regulations Relating to Money Services Businesses
76 C.F.R. 43585
***
The regulatory definition of ‘‘money transmission services’’ includes the phrase ‘‘or other value that substitutes for currency’’ to state that businesses that accept stored value or
currency equivalents as a funding source and transmit that value are providing money transmission services.
***
http://www.gpo.gov/fdsys/pkg/FR-2011-07-21/pdf/2011-18309.pdfThe FinCEN guidance is federal not state, and it doesn't define Bitcoin as a currency. This charge is apparently in violation of Florida
state law which prohibits “
currency or
payment instruments exceeding $300 but less than $20,000 in any 12-month period”.
To my knowledge no state has declared Bitcoin is currency. It hasn't been declared a 'payment instrument' either. If these people met to transfer two wheelbarrows full of grass in exchange for 30K would the arrest have been made?
We need some lawyers on this. The State/vested interests are clearly starting to push back on Bitcoin now, probably betting individuals by themselves won't have super legal defense resources.
EDIT: in fact FinCEN/Treasury
just confirmed that miners and businesses that buy and sell virtual currencies purely as an investment will not be considered money transmitters. (of course, that's federal level)
