Florida judge Theresa Mary Pooler dismissed criminal charges against bitcoin trader Michell Abner Espinoza, declaring that “bitcoin has a long way to go before it is the equivalent of money.”

The decision of the Miami-Dade Circuit Court may be of great importance to the status of bitcoin in the US. Bitcoiners have been waiting for the final verdict in the case The State of Florida vs. Michell Abner Espinoza for quite a long time.

Michell Abner Espinoza, a Local Bitcoins trader, was arrested on 6 February 2014 and charged with running an unauthorised money transmitter and money laundering. He sold $2,000 worth of bitcoin to an undercover detective and was conducting a $30,000 deal with him when arrested. The detective has said he was going to use bitcoin to buy stolen credit card numbers from Russian criminals but it did not stop Espinoza from trading with him.

Another Local Bitcoins trader arrested at the same time, Pascal Reid, pleaded guilty to the charges of being an unlicensed money broker and was sentenced to probation, agreeing in his plea deal to teach bitcoin usage to local police officers.

However, Espinoza, after two years of process, was finally cleared of all accusations, the main reason being the nature of bitcoin. According to the ruling of Theresa Mary Pooler,

“Nothing in our frame of references allows us to accurately define or describe Bitcoin… Bitcoin may have some attributes in common with what we commonly refer to as money, but differ in many important aspects… Bitcoins are not backed by anything. They are certainly not tangible wealth and cannot be hidden under mattress like cash and gold bars.”

Bitcoin is not money, it is property. Therefore, judge says, Espinoza cannot be guilty of money transmitting or money laundering. In the words of the ruling,

“Is it criminal activity for a person merely to sell their property to another, when the buyer describes a nefarious reason for wanting the property?”

In a curious twist, Dr Charles Evans, who acted as an expert witness in the case, helping prove that bitcoin is not money, was paid for his service in bitcoin.

In September 2015, US Commodity Futures Trading Commission ruled that bitcoin is a commodity. A different approach has been adopted in a number of other countries. In October, the European Court of Justice decided that bitcoin exchange transactions should be exempt from VAT, equating digital currencies to fiat. The Japanese government also recognised bitcoin as money. Russian Ministry of Finance plans to legalise bitcoin as a foreign currency.


Alexey Tereshchenko