A French court last month officially recognised Bitcoin as “money.” It’s the first time a French court has issued such a ruling, according to French publication Les Echos.
The ruling came from a dispute between French Bitcoin marketplace Paymium and crypto investment company BitSpread. Paymium had loaned BitSpread 1,000 Bitcoin in 2014. But in 2017, Bitcoin forked into Bitcoin Cash.
The court had to decide whether BitSpread owed Paymium any of the Bitcoin Cash that the fork created. 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.
Court ruling could benefit French Bitcoin market
This ruling could encourage more action in the French Bitcoin market. It will “facilitate Bitcoin transactions, such as lending or repo transactions, which are growing, and thus favor the liquidity of the cryptocurrency market," Hubert de Vauplane, lawyer of Kramer & Levin, told Les Echos.
Court rulings on the legal status of cryptocurrencies are important.
In the US, one of the most important legal issues is whether courts consider certain cryptocurrencies to constitute securities. Under US law, securities sales have to be registered with the SEC. And if a court rules that a token is a security, then that means that any token sales, such as initial coin offerings—were illegal.
In the UK, a hotly contested issue is whether Bitcoin constitutes “property” or “information.” If courts rule that Bitcoin counts as property, then they can chase after criminals more easily, and return stolen Bitcoin to their rightful owners. If courts rule that it’s “information,” then it’s harder for victims of crypto theft to get their money back, in some cases.