An Overview of Digital Currency Regulation and its Legal Implications

Digital currency systems make use of cryptographically secure distributed computing networks to exchange economic value and support a growing array of applications. The nature of these computing platforms and the scope of their applications raise important legal compliance issues. Many jurisdictions around the world are examining the extent to which digital currency systems are affected by existing laws and regulations, and the extent to which those existing laws should be modified or new laws enacted to address the growth of digital currencies. It is already clear, however, that a variety of laws and regulation in virtually every jurisdiction are already applicable to digital currency and its applications. In this environment, developers, distributors, and users of digital currency and associated systems already face substantial legal compliance issues. Understanding these current and potential legal compliance requirements is essential for successful use of digital currency platforms and their applications.