A South Korean court has deemed it illegal for authorities to confiscate Bitcoins belonging to an individual.
A South Korean court has recently deemed it illegal to seize an individual’s Bitcoins. The person in question was reported to run an illegal pornography website, but the seizing of his Bitcoins by the authorities was deemed illegal by the Suwon district court.
The local police had confiscated 216 bitcoins from the person who was allegedly running a pornography website illegally. The website has a considerable number of members, but there were doubts regarding the payment method. The payments were made either using Bitcoin, or the money was later converted. While the latter case would invariantly result in the person facing jail time, the authorities confiscated his bitcoins, something that the Suwon district court ruled as illegal.
South Korea is a major market for a number of cryptocurrencies. The country is the major contributor to the trading volume of a few prominent cryptocurrencies, like Bithumb, Korbit, and Coinone. Asian exchanges boost the trading and demand in cryptocurrencies from all over the world, and South Korea is a major player in the Asian Trade Exchange. Most of these transactions are legitimate, but a lot of activity is illegal in nature as well.
This precedent could prove to be a turning point in the history of Bitcoins and cryptocurrencies in general. At a time when there are myriad opinions and viewpoints regarding the usage and legality of cryptocurrencies, such a precedent could affect the thinking of critics and skeptics all over the world.
Many governments take up an offensive approach towards cryptocurrencies, arguing that they are not proper currencies, but a greater number of countries and their citizens are pro-cryptocurrencies. This is because of the falling trust in traditional transaction services, and the decentralized and anonymous nature of most cryptocurrencies. Privacy is the buzz word in these times, and cryptocurrencies are one way to achieve that regarding your financial transactions.
As per the ruling of the Suwon district court, it is ‘not appropriate to confiscate Bitcoins as they cannot assume an objective standard value’. This ruling has a dual and contrasting effect on the reputation of cryptocurrencies.
While it shows that South Korea understands that Bitcoin is electronic money and does not have any physical value, it also makes it difficult to evaluate the money if associated with criminal activities. Since Bitcoin doesn’t have any value, confiscating it wouldn’t show how much money was made. To do that, a valuation based on conversion to an appropriate currency has to be done. This second inference can make things difficult for the currency since it will make things more difficult for the protectors of law.
South Korea’s stand itself on cryptocurrencies has come into the light and might face harsh scrutiny. There’s no confirmation yet whether cryptocurrencies will gain full legal recognition in the country. However, the one thing that is for certain is that this precedent will have ripple effects all over the world. Whenever such a surprising decision is made, there are those who use the impetus and hop on the wagon started by the precedent. It’s quite possible to see similar rulings and precedents in other parts of the world, since cryptocurrencies are used almost everywhere, and their benefits outweigh the doubts as of now.
The speed of cryptocurrencies’ growth can only be contained until governments come up with proper legislations to protect the interests of those involved and prevent foul play. This precedent shows that governments are trying to understand cryptocurrencies better so that a system that ensures their survival as well as protects the citizens can be developed.