Professor Omri Marian of the University of Florida's Levin College of Law has published his paper "A Conceptual Framework for the Regulation of Cryptocurrencies" (University of Chicago Law Review Dialogue, Vol. 81, 2015 Forthcoming). The paper is available for download on SSRN.
From the abstract:
This Essay proposes a conceptual framework for the regulation of transactions involving cryptocurrencies. Cryptocurrencies offer tremendous opportunities for innovation and development, but at the same time are uniquely suited to facilitate illicit behavior. The suggested regulatory framework is intended to support (or, at the least, not impair) cryptocurrencies’ innovative potential. At the same time, the aim is to disrupt cryptocurrencies’ utility for criminal activities. To achieve such purposes, this Essay suggests a regulatory framework that imposes costs on the characteristics of cryptocurrencies that make them particularly useful for criminal behavior (in particular, anonymity), but does not impose costs on characteristics that are at the core of the generative potential (in particular, the decentralization of value-transfer processes). Using a basic utility model of criminal behavior as a benchmark, the Essay explains how regulatory instruments can be so designed. One such regulatory instrument is proposed as an example – an elective anonymity tax on cryptocurrency transactions in which at least one party is not anonymous.
We have discussed legal and business issues related to cryptocurrencies such as Bitcoin on a number of occasions.
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