Corporate Finance & Securities

An Overview of Laws Governing Bitcoin and Other Digital Currency

Bitcoin and other crypto currencies are currently subject to limited regulation. While lawmakers ponder the merits of new regulatory schemes targeted for crypto currency, we’ll take a look at some of the existing legal frameworks that could cause problems for Bitcoin businesses and Bitcoin users:

Money Laundering Laws

You can’t use Bitcoin to knowingly facilitate illegal purchases. For example, if you’re a payment processor and you know you are processing payments to facilitate purchases of heroin, you’re going to be subject to some serious penalties.

Washington’s money laundering law provides:

(1) A person is guilty of money laundering when that person conducts or attempts to conduct a financial transaction involving the proceeds of specified unlawful activity and: (a) Knows the property is proceeds of specified unlawful activity;...

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