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Bitcoin Gets Its First Mention in The US Supreme Court Opinion

Bitcoin | Bitcoin Mention US SUPREME COURT | BITCOIN IN US | Bitcoin updates

June 21st 2018 marked a landmark event for the cryptocurrency industry, the first mention of bitcoin in a US Supreme Court case. The cryptocurrency nod came in the dissenting opinion of Justice Stephen Breyer in the case Wisconsin Central Ltd v. United States.

Strangely enough, the case was not about any type of cryptocurrency regulation, but rather looked at whether employee stock options represent taxable compensation under the Railroad Retirement Tax Act of 1937.

The case involves subsidiaries of the Canadian National Railway Company (CN). They argued that stock options for their employees were not money remunerations and, as such, should be exempt from taxation under the Railroad Retirement Tax Act.

When the district court disagreed, CN appealed. On appeal, the Seventh Circuit upheld the district court’s decision, ruling that the stock options can be taxed like money.

The Supreme Court, however, ruled that stock options do not count as “taxable compensation” because they are not “money remuneration”.

 But the court also spelled out the dynamic definition of the word “money”, illustrating its complexity over time. It writes,

“But, it submits, the term can carry a much more expansive meaning too. At least sometimes, the government says, ‘money’ means any ‘property or possessions of any kind viewed as convertible into money or having value expressible in terms of money.’ 6 Oxford English Dictionary 603. The dissent takes the same view. See post, at 3 (opinion of BREYER, J.). But while the term ‘money’ sometimes might be used in this much more expansive sense, that isn’t how the term was ordinarily used at the time of the Act’s adoption (or is even today). Baseball cards, vinyl records, snow globes, and fidget spinners all have ‘value expressible in terms of money.’ Even that ‘priceless’ Picasso has a price. Really, almost anything can be reduced to a ‘value expressible in terms of money.’ But in ordinary usage does ‘money’ mean almost everything?

Breyer’s opinion, which included a citation to Money: The Unauthorized Biography — From Coinage to Cryptocurrencies, used bitcoin as an example of the changing nature of money and theorized that “perhaps one day employees will be paid in bitcoin or some other cryptocurrency.”

“Moreover, what we view as money has changed over time. Cowrie shells once were such a medium but no longer are; our currency originally included gold coins and bullion, but, after 1934, gold could not be used as a medium of exchange; perhaps one day employees will be paid in Bitcoin or some other type of cryptocurrency. Nothing in the statute suggests the meaning of this provision should be trapped in a monetary time warp, forever limited to those forms of money commonly used in the 1930’s.“

The dissenting opinion was joined by Justice Ruth Ginsburg, Justice Sonia Sotomayor and Justice Elena Kagan.

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