By Andy Greenberg

The trial of Ross Ulbricht, the alleged creator of the Silk Road Bitcoin-based black market for drugs, hasn’t yet begun, but it’s already raising hairy legal questions. First on the docket: Is Bitcoin even money?

In a motion filed over the past weekend, Ulbricht’s lawyer Joshua Dratel argued that all charges against his client should be dropped, including accusations of conspiracy to traffic in narcotics, launder money, hack computers, and run a “continuing criminal enterprise,” a charge often called the “kingpin” statute and used to prosecute mafia and cartel leaders. After being arrested in San Francisco last October, Ulbricht pleaded not guilty to all those charges in February.

The 64-page document calls into question everything from the legal liability of running a website where users of the site rather than its owners are engaging in illegal activity, to the definition of “unauthorized access” under the controversial Computer Fraud and Abuse Act. But the most unique argument in the motion, perhaps, focuses specifically on the money laundering charge against Ulbricht, who is accused of creating and managing the Silk Road’s billion-dollar-plus business in anonymous sales of contraband using the cryptocurrency Bitcoin.

Dratel argues that his client can’t have used Bitcoin for money laundering, because it doesn’t fit the current law’s definition of “money.”

“Count Four, which charges Mr. Ulbricht with participating in a money laundering conspiracy…must be dismissed because the allegation lacks an essential element: that the ‘financial transactions’ alleged involved ‘monetary instruments,’” the motion reads. “Bitcoins, the exclusive means of payment on Silk Road, do not qualify as ‘monetary instruments,’ and therefore cannot serve as the basis for a money laundering violation.” Continue reading here.

http://www.forbes.com/sites/andygreenberg/2014/04/01/alleged-silk-road-creators-lawyer-denies-bitcoin-is-monetary-instrument-moves-to-drop-all-charges/