Bitcoin Is Money Says Silk Road Trial Judge

bitcoin

Though it could have gone down in history alongside the Twinkie defense as creatively ludicrous defenses in a criminal trial, the judge in the Silk Road trial has struck down the “Bitcoin isn’t money, and without money their can be no money laundering” defense that shut-down bitcoin-based black market was attempting to employ.

The judge also threw out the argument that Ross Ulbricht, the 30-year-old alleged creator of the Silk Road who currently is facing charges of money laundering, drug-trafficking and being a criminal “kingpin,” was merely the innocent creator of a website that others then used to sell lots and lots of drugs.

“Silk Road was specifically and intentionally designed for the purpose of facilitating unlawful transactions,” trial judge Katherine Forres in her 51-page order. “Ulbricht is alleged to have knowingly and intentionally constructed and operated an expansive black market for selling and purchasing narcotics and malicious software and for laundering money. This separates Ulbricht’s alleged conduct from the mass of others whose websites may—without their planning or expectation—be used for unlawful purposes.”

On the claim that bitcoins aren’t money, and therefore Ross could not logically be resposbible for money laundering, Forres countered that neither the IRS nor FinCEN have any power to legally defined money laundering laws.  She further noted that the claim is somewhat nonsensical given the use of bitcoin on the Silk Road exchange.

“Sellers using Silk Road are not alleged to have given their narcotics and malicious software away for free – they are alleged to have sold them,” she writes. “The money laundering statute is broad enough to encompass use of Bitcoins in financial transactions. Any other reading would—in light of Bitcoin’s sole raison d’etre—be nonsensical.”

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