by Cindy Huynh
The US Supreme Court has referenced Bitcoin and cryptocurrencies in a case. While the case wasn’t focused on cryptocurrency regulations, it marks a crucial moment in cryptocurrency history. The Supreme Court had openly considered cryptocurrencies a potential medium of exchange in the future.
Court Mentions Cryptocurrencies
In Wisconsin Central Ltd. v. United States case, the Supreme Court assessed whether a worker’s stock options should be taxed in a similar way to money. On June 21, 2018, the Court decided “it’s clear enough that the term money unambiguously excludes stock.”
Justice Stephen Breyer, who drafted the opinion then looked at how the concept of money can change over time. “So money as used in this statute, must always mean a medium of exchange,” said Breyer. “But what qualifies as a medium of exchange may depend on the facts of the day.”
Breyer looked to history to illustrate his case. He mentioned Cowrie Shells and gold as prime examples of currency accepted decades earlier but are no longer accepted today.
“Perhaps one day employees will be paid in Bitcoin or some other type of cryptocurrency,” said Breyer. “Nothing in the statute suggests the meaning of this provision should be trapped in a monetary time warp, forever limited to those forms of money commonly used in the 1930s.”
Cryptocurrencies as a Future Means of Payment
Although the case was not centered on cryptocurrencies, the idea that the conservative US Supreme Court considers cryptocurrencies as a potential medium of exchange for the future has significant implications.
The US is, however, not the only country open to the changing definition of money and currency. In May 2018, the Iranian Government announced they were keen to explore a national bank-issued cryptocurrency that’s backed oil.
Bitcoin Used for Money Laundering
Unlike the US, the Iranian Government’s national currency is relatively unstable. The country is also currently experiencing a massive outflow of funds in cryptocurrencies. According to reports, approximately $2.5 billion has left the country in Bitcoin.
“With exchange offices closed, sanctions and the rial dropping like crazy it seems like a good idea to use Bitcoin,” said a person who wished to remain anonymous after speaking to Forbes. “I know that there are a few people selling and buying Bitcoin in Iran with LocalBitcoins.”
With money leaving the country and Iran’s national currency falling to new lows, the Iranian Government is under much more pressure than the US to consider adopting digital currencies in the short term.
While the idea of governments adopting cryptocurrencies appears like a good idea, the Venezuelan state-backed cryptocurrency, the Petro, appears otherwise. According to Forbes, while the Petro ICO was intended to fund public needs in the country, many Venezuelan politicians declared the Petro as unconstitutional. The Venezuela Asamblea Nacional not only called the project a fraud but a threat to any interested investors.