Wednesday, January 8, 2014

Could A Civil War-Era Law Stamp Out Bitcoin?

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The Congressional Research Service recently took a close look at Bitcoin, and it discovered a rather unexpected land mine that could bring down the world’s most popular digital currency: the Stamp Payments Act of 1862.

This 152-year-old law forbids any American from issuing a check, note, or token that’s worth less than $1, and Bitcoin — which you can think of as a kind of digital token that can be broken down into tiny values, potentially worth much less than $1 — might just fall into that category, according to a report from the Congressional Research Service, the Library of Congress operation that does research on behalf of lawmakers on Capitol Hill.

Indeed, over the past two years, academics and legal scholars have been quietly debating whether or not the Stamp Act — or other government regulations — could be used to curb Bitcoin’s use. It’s certainly possible, says Darrell Duffie, a finance professor at Stanford University.

This 152-year-old law forbids any American from issuing a check, note, or token that’s worth less than $1

“A lot depends on whether the government becomes anxious to move against Bitcoin,” he says. “Whether this is the most appropriate statute under which to control Bitcoin, I’m not so confident.”

For the rest of the story: http://www.wired.com/wiredenterprise/2014/01/stampact/

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