Is Bitcoin money? A security? Can scripts be smart contracts? Are smart contracts even a real thing? What do “identity”, “intellectual property” and “fungibility” mean in Bitcoin? What’s the legal status of crowdfunding and ICOs? Dr. Craig Wright and Money Button founder Ryan X. Charles discuss these questions and more in this week’s “Theory of Bitcoin” episode.
Dr. Wright is back from vacation in Italy and ready to continue the topic the pair started in the third episode: Bitcoin and the law. The previous edition gave a historical background on why laws are necessary and who should decide them—episode four looks more specifically at how certain laws may apply to Bitcoin.As Charles discovers, the answer to many legal questions is “yes and no,” or “it depends.” That’s because, as Dr. Wright points out, laws and how they are applied are determined by humans in certain jurisdictions—Bitcoin itself, apart from its base protocol, does not create any new laws or invent ways around existing ones.
Sui generis
The legal notion of “sui generis” is important here. That’s the term used to explain how legal status may be conferred upon something previously ambiguous or undefined—such as a new technology, or something not specifically mentioned in the original law. What this means is, Bitcoin’s legal status (including the status of concepts deriving from its use) depends on the jurisdictions in which it exists.
Is Bitcoin a security? If a regulatory authority (like the SEC) says it is, then it is. Is crowdfunding legal? Yes and no, depending on the amount raised and the purpose—again, defined by legislators or courts deciding on a case. The sui generis principle applies to nearly anything you can do with Bitcoin and, as Dr. Wright points out, “miners” (aka “nodes”) neither create new laws nor vote on them.