Las Vegas Lawyers Concerned about Bitcoin: Legal Tender or Liability?
Two Vegas casinos recently announced that they are accepting Bitcoin as legal tender, and Overstock.com became the first online retailer to accept the currency. But what does the future of the unregulated virtual coin currency hold? As the currency gains in popularity, many are speculating how it will gain legitimacy, while others are emphasizing caution. In places like Nevada, where high-risk monetary endeavors are popular, Bitcoin may be opening a new way to stimulate various markets, but Las Vegas lawyers examining the situation caution users to be wary, for now. The chairman of the Nevada Gaming Control Board agrees, telling the Salt Lake Tribune not to expect gambling in any form with Bitcoin any time soon.
The two casinos in Las Vegas are the D casino and the city’s oldest casino, the Golden Gate. But the only places in the casinos where Bitcoin is being exchanged are the gift shops, hotel front desks and restaurants. The industry hasn’t been reported to approach regulators about approval for gambling, and part of that reason is Bitcoin’s inherently unregulated status. Clarity about Bitcoin use for gambling would require regulation from the U.S. Treasury, Department of Justice and IR. But the virtual currency may be headed mainstream without regulation. Some are arguing that the currency is worth noting (and even using) because of its recent speculative rise in value, a trend which signals an inevitable rise in use. So what’s the hold up? Without a federal guarantee, Bitcoin poses some problems. Las Vegas lawyers foresee potentially complex fraud cases and varying applications of tax law pertaining to assets and mutual business and financial transactions utilizing the virtual currency.
Some consumer concerns about Bitcoin include its lack of stability, and many online retailers like Amazon state that they have no intentions of accepting the cyber-currency, though eBay is apparently considering it. The usefulness of the currency has in part depended on its speculative value. For it to be worth using, enough people have to be interested in using it, this creating a bubble. And even with a burst bubble, if enough people remain interested in using it, it’s likely to stabilize enough to make it worth industry note. But Overstock.com and the two Las Vegas casinos aren’t taking chances. Every Bitcoin they accept is immediately converted to U.S. dollars by a Bitcoin broker online.
Las Vegas lawyers eyeing the legal implications of unregulated currency emphasize that while most of Bitcoin’s appeal may lie in its ambiguity as a commodity, currency or capital asset and how it can be taxed, others insist that some of the popularity in using Bitcoin also affects its risk. As an unregulated currency, its value fluctuates rapidly, unlike government-issued money. Others see the cyber currency as a Utopian solution to government oversight: no borders, no change fees and no closing hours. Originally most favored by radical libertarians, Bitcoin’s recent popularity is demonstrating its ability to enhance trade and stimulate growth in sectors where its accepted. The future may hold more opportunity for its use as financial institutions, retailers and customers become enamored with the freedom of using Bitcoin, currently, not a taxable asset. Ponder that for a minute, accountants and taxmen.