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Questions tagged [cryptocurrency]

Questions concerning the laws on creating, using, transfering and realising cryptocurrency.

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-4 votes
1 answer
70 views

Does online business, only using crypto currency have collect a tax bill before they can release funds back to an individual?

Online platform company, invest small amount of funds to earn a commission by reviewing items. If an item becomes to expensive you account goes negative and you have to deposit money to clear to ...
6 votes
1 answer
480 views

Do FCA rules mean financial firms have to refuse service if their customers are not knowledgeable enough?

I recent weeks I have had emails from multiple cryptocurrency exchanges requiring me to fill in a document online to keep using their services. They describe this as a questionnaire but say "You ...
2 votes
1 answer
123 views

Why can Dutch police order Binance to freeze funds of Colombian customers?

In short, Dutch police ordered Binance (cryptocurrency exchange) to freeze funds of some Colombian customers, and those customers are supposed to prove - to the satisfaction of Dutch police - that ...
2 votes
1 answer
401 views

What kind of claims did Ryan Salame forfeit in the FTX trial?

There is a recent article about the trial of Ryan Salame surrounding the crypto-currency platform FTX. The article starts with the big headline that he forfeited $1,5 billion and then writes later on ...
2 votes
1 answer
164 views

How could someone whose trades are being copied be liable to the person who is doing the copying?

It is reported that someone was copying the trades of a noted NFT trader. This noted NFT trader profited from this by making an inflated bids on one of his own NFTs, and when the copycat replicated ...
2 votes
2 answers
316 views

Capital Gains: If I loan Bitcoin to my LLC, can the LLC sell it to pay for expenses, and later repay the loan in USD tax free? (USA Law)

I understand that taking a credit line against Bitcoin collateral is not capital gains event because there is no sale. However, If a party, such as a company, is lent Bitcoin (BTC), sell it to pay ...
3 votes
1 answer
67 views

What are the consequences of being party to a OFAC prohibited transaction?

The US Treasury has sanctioned Tornado Cash which is a tool for mixing Cryptocurrency. Since the sanctions don't actually stop this tool from working someone has used it to send small amounts of funds ...
1 vote
0 answers
32 views

What requirements does the CFTC vs Ooki DAO Default Judgment place on token holders?

On June 8th, 2023 the District Court, N.D. California awarded default judgment against Ooki DAO for allowing illegal trading of digital assets, engaging in activities only allowed by registered ...
2 votes
1 answer
128 views

Is Crypto the same as any foreign currency?

A foreign currency exchange is nothing new. On the other hand cryptographic currency ("crypto" i.e. Bitcoin) is relatively new, as are their exchanges. https://abcnews.go.com/Business/...
-1 votes
1 answer
80 views

is reselling virtual "in game" items legal in the USA?

If I were to buy virtual in game items through third party websites which is against the game's TOS with bitcoin then resell them for more money is that legal?
-1 votes
1 answer
82 views

How to verify an arrest in Russia? [closed]

Assume the media reports that a particular individual has been arrested by Russian police. Others reports deny this. Is there any authoritative legal mechanism for ascertaining the true situation?
-5 votes
1 answer
76 views

Can I turn cryptocurrency into giftcards without being taxed? [closed]

Alright, so my idea is to trade crypto then turn it into giftcards since I don't have a bank account. I want to make sure taxes don't apple. Thanks for any help!
2 votes
1 answer
54 views

How consumers taxed with a cryptocurrency prepaid card?

A store decided to issue a prepaid card that can be loaded with cryptocurrency and used only in that store. Will the customers pay tax when they load the card, use it, or both? I am interested in US ...
2 votes
1 answer
86 views

What features are used to distingish between investing and running a money transmitting business?

This question about the risk of money laundering prosecution one could face using decentralized cryptocurrency exchanges is answered by "Generally, local laws will define concepts like "...
6 votes
2 answers
899 views

Is it possible for an individual to commit money laundering like a bank?

In the classic example of money laundering, Charlie the Criminal would take his dirty money to Bob the Banker and get it in some form that is spendable and transferable. In this situation it would be ...
-2 votes
2 answers
401 views

My crypto exchange closed my account for no reason, how can I defend myself against it? [closed]

A couple of years ago, I opened an account in Bitpanda, deeming it a serious and professional crypto exchange. In the last year I haven't carried out any operations, a few days ago I decided to go ...
2 votes
0 answers
63 views

How to find a US lawyer for consultation in the open-source + banking + blockchain space?

Considering writing open-source software in the banking/cryptocurrency space (in the USA). Want to do it properly, and have a few questions for how to navigate the space. What's the type of lawyer I ...
0 votes
0 answers
554 views

Are flash loan attacks legal?

A new form of "money making activity" has emerged in recent years, the flash loan attack. In very rough terms, a loan of some cryptocurrency is taken out, the cryptocurrency is used in some ...
2 votes
1 answer
225 views

Is it legal to include a crypto miner in published software?

If I publish a program (say a text editor), and I include a cryptocurrency miner that puts all of the coins in my wallet (and the mining itself does not accomplish anything that benefits the user, e.g....
3 votes
2 answers
532 views

Is it legal to create a cryptocurrency?

I want to create a new cryptocurrency as an experiment. Is this legal? My cryptocurrency won't use a blockchain, so laws specifically regulating blockchains might not apply. The system will be ...
2 votes
0 answers
69 views

If I create smart contracts for my clients on fiverr, upwork, etc., can I be arrested in Bangladesh?

The legality of cryptocurrency is a bit tricky in Bangladesh. A cautionary notice issued by the Bangladesh bank on December 24, 2017, said: My translation: Recently, it has been known from various ...
19 votes
4 answers
4k views

Is it against the law to sell Bitcoin at a flea market?

I think this would be a cool side gig and I have some ideas about how to make Bitcoin more accessible to the general public. But I don't want to break the law either. These would be normal flea ...
-1 votes
2 answers
188 views

Is it illegal to borrow cryptocurrency without consent?

Suppose I obtain the ability to access someone else's cryptocurrency. For the sake of the question let's assume the means by which this ability was obtained wasn't itself illegal, e.g. I overheard ...
2 votes
4 answers
207 views

Sanctions against dealing in Bitcoin

Some countries are treating dealing in Bitcoin as seriously as drug-dealing and money laundering [0]. Suppose that you are a citizen of another country (and normally live in it) that does not have ...
0 votes
1 answer
433 views

How much stolen bitcoin must a wallet have to be legally recoverable?

TLDR: Under what circumstances could one successfully sue to gain control of stolen bitcoin? If it depends on what proportion of an addresses unspent output consists of your stolen bitcoin then what ...
1 vote
1 answer
123 views

How is a derivative work defined wrt "low entropy" artwork

CryptoPunks are a set of 10,000 Ethereum-based NFTs, each token corresponding to a unique 24 x 24 pixel cartoonish figure. They have been automatically generated from human generated components ...
2 votes
1 answer
76 views

Could everyone with DAO tokens in the EU be punished under recent Transfer of Funds Regulations on KYC?

On March 31st the ECON and LIBE committees of the EU Parliament has voted to require cryptocurrency service providers to collect personally identifiable information from individuals who transact more ...
3 votes
1 answer
173 views

Is cryptocurrency more like money or stuff with regards theft?

I am sure there is a word that describes this concept, but I do not know it so I shall have to describe it. Suppose Alice has a mobile phone, Broke Bob steals it, sells it to Charlie's Mobile Phone ...
2 votes
3 answers
281 views

Who owns the intellectual property rights relating to a stolen NFT?

Bored Ape non-fungible blockchain tokens (NFTs) change hands for tens to hundreds of thousands of dollars. For this money you get two things, A) the technical ability to create transactions involving ...
1 vote
1 answer
31 views

What is GST status over Crypto transactions in India?

Even though profit from cryptocurrencies like Bitcoin and Ethereum are taxed at 30%, that is only on converting that into Indian fiat, only then the citizen has to pay the tax of 30% of profits of ...
0 votes
1 answer
79 views

Is cryptocurrency mining/staking profits "newly created property"?

Forbes Feb 2, 2022: "According to a May 2021 civil lawsuit filed by the couple, Joshua and Jessica Jarrett, any tokens gained through proof-of-stake should be considered “new property” created by ...
1 vote
1 answer
145 views

How does contract law apply to smart contracts?

We quite frequently hear about some cryptocurrency company losing money because their software was exploited. From example today we have Qubit losing $80 million: The protocol was exploited by; ...
2 votes
1 answer
108 views

If you buy something only sold in cryptocurrencies - for example, a non-fungible token (aka NFT) - is that a potentially taxable event?

Suppose I buy one Etherium cryptocurrency coin and then purchase a non-fungible token for one Etherium coin. One cannot buy an NFT using any other currency than a cryptocurrency, but cryptocurrencies ...
0 votes
0 answers
51 views

Avoid Capital Gain Tax Selling Borrowed Tokens

I live in UK, but wouldn't mind to get responses related to any jurisdiction. better explain with an example: I buy 180Tokens at $0.10 price. 1 year later I still have those 180Tokens. I freeze ...
0 votes
1 answer
81 views

What laws do crypto exchanges need to abide by?

So they need to collect personal information on each user most of the time right? But how thorough does this information need to be? Do the exchanges need to check with each government to make sure ...
0 votes
1 answer
40 views

In what circumstances does an investment advisor have to register as a money transmitter?

As far as I understand it, an SEC-registered investment advisor that doesn't hold the client's assets doesn't need extra regulation pertaining to custody. If a robo-advisor like Betterment (although I ...
0 votes
1 answer
100 views

Is there any doubt about crypto-currency and like-kind exchanges?

If I sell crypto, can I purchase new crypto and avoid paying capital gains tax on it? It seems the IRS is very clear about it, Under the Tax Cuts and Jobs Act, Section 1031 now applies only to ...
-1 votes
3 answers
127 views

Could someone avoid legal responsibility by transferring crypto coins multiple times between wallets before making an illegal purchase? [closed]

Suppose the following scenario. Someone creates two different crypto wallets without leaving an online trace that links their real identity back to the wallets in any feasible way. Then purchases some ...
0 votes
3 answers
338 views

Can you avoid paying taxes on the Bitcoins you've sold by using a shell company outside of the U.S. and transferring the coins to it before selling?

Can you avoid paying taxes on the Bitcoins you've sold by using a shell company outside of the U.S. and transferring the coins to it before selling? I am wondering if there's a legal flaw in the ...
0 votes
1 answer
42 views

Does a cryptocurrency trading platform not require licensing if it does not offer trade of securities?

The article SEC Charges EtherDelta Founder With Operating an Unregistered Exchange states that: Over an 18-month period, EtherDelta's users executed more than 3.6 million orders for ERC20 tokens, ...
-2 votes
1 answer
62 views

Can my bot trade crypto for others? [closed]

Is it legal if someone gives me their API key for phemex, with the intention that my bot ( which predicts and can trade each minute ) will trade for them? Alternatively, if I license software which ...
3 votes
3 answers
3k views

How are cryptocurrencies not illegal by the US Constitution?

The United States Constitution, Article I, Section 8 reads in part, The Congress shall have Power To coin Money, regulate the Value thereof, and of foreign Coin. From this passage, I understand ...
0 votes
2 answers
139 views

What crime could occur while processing non-fungible tokens without copyright?

Alice creates a non-fungible token (NFT) of a digital file that they do not own copyright of. She adds the token to the ethereum blockchain, and creates a transaction that transfers it to a wallet ...
0 votes
0 answers
73 views

Are there any cases in which click fraud is legal?

I recently had an idea for a small cryptocurrency in which instead of paying with real money, you pay with clicks on pay-per-click ads and a portion of the revenue that the website makes off of that ...
1 vote
0 answers
71 views

Cybercrime use of cryptocurrency and stolen goods laws

I've been wondering if this line of reasoning has been tried anywhere in the world, successfully or unsuccessfully. It seems improbable that I'm the first to think of it ... A cryptocurrency is a bit ...
0 votes
1 answer
127 views

I told my friend I'd give him £10 in Bitcoin for their birthday 5 years ago but never did. Am I liable for £0, £10 or £1000?

Two questions. Firstly, is it enforceable. Secondly, if it were, would I owe £10 in Bitcoin now, or the amount of Bitcoin at the date £10 would get you 5 years ago? I believe I've answered the first ...
1 vote
1 answer
145 views

Would a bitcoin "cleaning" service be legal in New Zealand?

I'd like to create a piece of software or service which takes someone's Bitcoin, goes through a process of "cleaning" it (making it untraceable) and then returning it. Provided the purpose ...
-7 votes
1 answer
369 views

Creating my own crypto [closed]

Imagine this I create my own defi cryptocurrency I take out loans denominated in the currency, ie, legal contracts to give people money in the future Then, I print more money for myself to inflate ...
1 vote
2 answers
240 views

Legality of Chaumian e-cash

In the 1980s, David Chaum, a cryptographer, came up with micropayment system that would achieve cryptographic transaction privacy. Later, in the 1990s, he attempted to build this system, but it did ...
4 votes
0 answers
68 views

Bitcoin service regulations

Most governments don't consider Bitcoin to be currency, so it's somewhat of a legal gray zone regarding regulation. I know most exchanges must follow KYC/AML systems because they trade with fiat too, ...