Blockchains and Bitcoin: Regulatory Responses to Cryptocurrencies

First Monday, Volume 20, Number 12 - 7 December 2015

46 Pages Posted: 18 Dec 2015

See all articles by Andrés Guadamuz

Andrés Guadamuz

University of Sussex

Christopher Marsden

University of Sussex Law School

Date Written: December 7, 2015

Abstract

This paper examines Bitcoin from a legal and regulatory perspective, answering several important questions.

We begin by explaining what Bitcoin is, and why it matters. We describe problems with Bitcoin as a method of implementing a cryptocurrency. This introduction to cryptocurrencies allows us eventually to ask the inevitable question: is it legal? What are the regulatory responses to the currency? Can it be regulated?

We make clear why virtual currencies are of interest, how self-regulation has failed, and what useful lessons can be learned. Finally, we produce useful and semi-permanent findings into the usefulness of virtual currencies in general, blockchains as a means of mining currency, and the profundity of Bitcoin as compared with the development of block chain technologies. We conclude that though Bitcoin may be the equivalent of Second Life a decade later, so blockchains may be the equivalent of Web 2.0 social networks, a truly transformative social technology.

Keywords: regulation, cyberlaw, bitcoin, blockchain

JEL Classification: K00

Suggested Citation

Guadamuz, Andres and Marsden, Christopher T., Blockchains and Bitcoin: Regulatory Responses to Cryptocurrencies (December 7, 2015). First Monday, Volume 20, Number 12 - 7 December 2015. Available at SSRN: https://ssrn.com/abstract=2704852

Andres Guadamuz (Contact Author)

University of Sussex ( email )

Falmer
Brighton, BN1 9QN
United Kingdom

Christopher T. Marsden

University of Sussex Law School ( email )

Falmer
Brighton BN1 9QN
United Kingdom

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