A French court has decided that bitcoin is money, the first time a court in France has issued such a ruling, according to a report from Les Echos Sunday (March 8).
The decision came about following a clash between the Bitcoin marketplace Paymium and the crypto investment company BitSpread. The result of the ruling could lead to more activity in the French bitcoin market.
After Paymium loaned BitSpread 1,000 Bitcoin in 2014, a dispute erupted sometime before 2018. During 2014-18, BitSpread opened an account on Paymium.
In 2017, Bitcoin hard forked, creating Bitcoin Cash, a new cryptocurrency.
“The court had to decide whether BitSpread owed Paymium any of the Bitcoin Cash that the fork created,” according to a report from Decrypt.“It eventually ruled that the Bitcoin Cash belonged to BitSpread, just like dividends are paid out to a shareholder. And as part of its ruling, it concluded that Bitcoin was a fungible asset, just like money.”
This ruling could encourage more activity in the French Bitcoin market. It could “facilitate Bitcoin transactions, such as lending or repo transactions, which are growing, and thus favor the liquidity of the cryptocurrency market,” said Hubert de Vauplane, lawyer of Kramer & Levin, according to Decrypt.
An argument in the U.S. whether courts allow some cryptocurrencies to constitute securities. Securities sales have to be registered with the Securities and Exchange Commission in the U.S. If a court decides a token is a security, then any token sales — like initial coin offerings (ICOs) — were illegal.
The U.K. is debating if Bitcoin constitutes “property” or “information.” If the courts decide Bitcoin is property, then law enforcement could track down thieves and return the stolen goods to their rightful owners. If the courts rule that Bitcoin is “information,” then it will be more difficult for theft victims to get money returned.
The French Financial Markets Authority (AMF) announced in December that it had approved its first ICO — “ICO visa” — to the cryptocurrency fundraising platform French ICO.