Bitcoiners like to defend their community by proclaiming it just that – a community. But, what if in a court of law, Bitcoin could be defined as a corporation. What would this mean for Bitcoiners?
If the so-called Bitcoin Community were declared a corporation, the precedent would then be set for online creation communities to thus be considered corporations. This would have far-ranging implications for all online creation communities, which encompasses technologies like Linux.
If Bitcoin were ruled a corporation, then it would have operated for numerous years unregistered. As many early bitcoiners argued, holding Bitcoins would be like owning stock in an early tech startup. If this were the case, then Bitcoiners might all be seen as stakeholders in the Bitcoin corporation.
Who would be considered the controlling parties? This might imaginably fall back on the developers, in particularly the core developers. The responsibility to incorporate, it might be argued, falls back on the development team for not incorporating.
If not the developers, then perhaps the bosses are the miners. If most Bitcoiners are from North America, then their bosses are Chinese (since most miners hail from behind The Great Firewall).
Bitcoin as a corporation makes sense. What is Bitcoin otherwise? A protocol? A community? These sorts of things do not exist in the legal framework. So, there must be some compromise. When the anatomy of an online creation community is dissected, what’s left to behold is a organizational type structure that reflects the modern institution. The question, then, is simple: Is Bitcoin most like a government, a private corporation, a non-profit or a church? This might be the sort of things discussed in a court of law. Of course, the final decision might have implications for Bitcoin development and users.
Now, forget Bitcoin. Let’s look at some Bitcoin 2.0 technologies. In particular, Ethereum. Ethereum took on nearly $20 million worth of bitcoins in a pre-sale. Ethereum does not consider itself a corporation. But, if it were, what it did in terms of the pre-sale is akin to an unregistered stock issuance.
Ethereum developers and community, similar to Bitcoin, considers the project an online creation community, not a corporation. But, having taken on $20 million, new stakes are raised for the Ethereum development team. If their vision fails, and many people lose their investment, law enforcement investigations could ensue.
In the coming years, how the definition of Bitcoin evolves could have wide-ranging legal implications for the technology and its users.
Because protocols, nor online creation communities, fall under heretofore existing regulatory frameworks, a ruling maybe in order to regulate Bitcoin beyond its currency, property and commodity attributes, and regulate it as an entity.
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Last modified: May 21, 2020 10:34 AM UTC