A federal judge has given the green light to U.S. regulators to proceed with their Bitcoin Ponzi scheme lawsuit. The ruling is expected to have major implications for the virtual online money system.
A Texas man is accused of operating of raising 70 million US dollars in digital currency, from investors. Whether or not Bitcoin investments count as securities, and are therefore subject to US regulation, is at the centre of the case.
On July 23, the securities exchange commission warned of potential scams involving virtual currencies. Bitcoin is not managed by any one company, or regulated by any central bank. It’s supply is controlled through a computer algorithm.
Users have been buying bitcoins through exchanges that convert real money into the virtual currency, since 2009.