13 Actions The US Took Against Bitcoin

February 17, 2016

Bitcoin has been under heavy scrutiny since the very moment of its inception. As the value of the cryptocurrency has skyrocketed recently, people in the community are wondering if governments will soon step in and end the era of unregulated cryptocurrencies.bigstock-Bit-Coin--BTC-54872375

Here are some actions the US government took against Bitcoin in the past:

1. US Federal Government Seized $25 Million Worth Of Bitcoin From Online Black Market Silk Road

After shutting down the infamous haven for online drug sales and arresting the alleged founder, the federal government managed to secure about $25 million worth of Bitcoin. This action falls under the “approved” category.

2. US Federal Government Sold Seized Silk Road Bitcoins

A federal judge then announced that the approximately 30,000 Bitcoins seized from the Silk Road could be sold off into the market.

3. U.S. Attorney Preet Bharara

U.S. lawyer Preet Bharara stated that the Silk Road Bitcoins that were seized by the government were seized because of their connection to illicit activities. This is reassuring for the Bitcoin community, as it makes a distinction between Bitcoins used for legitimate purposes and those used for drug deals or other illegal activities.


4. New York Department Of Financial Services Subpoenaed 22 Bitcoin Companies

Although this was not an action by the federal government, the fact that local regulatory bodies wanted to gain information about Bitcoin companies indicated that government agencies would one day try to regulate the Bitcoin market.

5. The House Of Representatives

The House of Representatives requested an FBI briefing on the potential for money laundering and criminal financing via Bitcoin. This indicated that federal legislators were concerned about the long-term implications of Bitcoin and could be the first step toward enacting some form of Bitcoin regulation.

6. FinCEN Releases “Suggested” Guidelines

The U.S. Financial Crime Enforcement Network (FinCEN) released “suggested” guidelines for the Bitcoin market. The guidance stated that anyone dealing in Bitcoins was technically acting as a money transmitter, which means that regulations typical of money transmitter companies might eventually be applied to the Bitcoin market.

7. Funds Seized From Bitcoin Exchange Mt. Gox

The U.S. Department of Homeland Security seized funds from Bitcoin exchange Mt. Gox. This was done as a precursor to a full-blown investigation of well-known Bitcoin exchanges due to their non-compliance with FinCEN guidance.

8. Ponzi Scheme Charges

The Security and Exchange Commission filed Ponzi scheme charges against a Texan named Trendon Shavers. He allegedly stole around $4.5 million from Bitcoin investors. This means that federal financial regulators treat fraud in Bitcoin the same as fraud in dollars.


9. Bitcoin Oversight

The Senate Homeland Security and Government Affairs Committee sent letters to federal departments regarding the oversight of Bitcoin. The letters were sent to the Department of Homeland Security and the Treasury to determine what needed to be done to regulate the growing cryptocurrency market.

10. New York State Banking Regulators Planned To Start Regulating Bitcoin In 2014

Top New York State banking regulator Benjamin Lawsky was conducting hearings in 2014 on the best methods with which to regulate Bitcoin. New York’s “BitLicence” was implemented afterward in 2015.

11. Manhattan District Attorney Wanted Stronger “Tools” To Combat The Threat Of Bitcoin And Other Cryptocurrencies

Concerns over money laundering, tax evasion, and fraud drove Manhattan district attorney Cyrus Vance Jr. to push for regulation of the Bitcoin market by requiring Bitcoin balances to be reported to the government.

12. Identifiable Bitcoin Transactions In New York

This was intended to remove the ability to send and receive Bitcoins anonymously, which for many was the primary benefit of using Bitcoin.

13. New York Based Bitcoin Exchange BitInstant’s CEO Arrested

Prosecutors claimed he was transferring money to alleged Silk Road founder Ross Ulbricht.


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