Is Bitcoin Mining Legal in the US?
Bitcoin leads the race in cryptocurrency on many levels. It’s certainly the most well-known and it currently holds the highest value in the cryptocurrency market hovering around $40,000.00 per coin at the time of this article.
Yet it’s still somewhat of a mystery to some. Where does Bitcoin come from? Is Bitcoin mining legal? In this article, we’ll answer these questions and present a brief overview of this leading cryptocurrency.
The US is still figuring out its relationship to Bitcoin as a whole. There are plenty of laws regarding the acquisition and sale of bitcoin. However, laws and regulations change from state to state.
With no one-size-fits-all approach to the handling of bitcoin, this makes the legality of operations fuzzy. As it stands, consumers can invest in Bitcoin, as well as use it as a form of payment just like any other form of currency.
But where does bitcoin come from? New coins get entered into circulation through a process called mining.
Is Bitcoin Mining Legal?
The primary purpose of mining can be thought of through three steps: to legitimize, monitor, and ensure. Because bitcoin is a decentralized currency, transactions are mined from people worldwide. Someone in California can work to ensure the validity of a blockchain while someone across the world in India does the same.
One can think of mining as similar to a traditional audit process. Bitcoin miners verify transactions. This verification method allows cryptocurrencies to continue circulating.
So, is bitcoin mining legal in the US? Yes. Let’s look at a simplified example.
The Bank Teller
Picture this. You’ve just received a crisp $100 bill in your birthday card from Grandma. You head to the bank to deposit it into your account. The teller double-checks it to make sure it’s not a counterfeit.
It goes to your account. It’s safe to say you no longer have that $100 bill on your person. There’s no way you can go to the store and offer up that same $100 to buy something.
In overly simplified terms, your teller could be considered the bitcoin “miner”. They legitimized the transaction for you and confirmed its validity. There is little risk that they would then take your $100 bill, make a counterfeit, and spend it.
A bitcoin miner would do much the same. They check transactions to confirm the same bitcoin has not been spent twice. Businesses such as ManagedBitcoinMining provide fully-integrated mining containers for legal bitcoin mining.
Regulations vary at both federal and state levels when it comes to bitcoin being mined and used as currency. Guidelines are still getting ironed out and an overarching framework as to its use is still under construction.
After all, regulating a still relatively new cryptocurrency is no easy feat. Is mining bitcoin legal? In the US, absolutely.
Hopefully, we’ve answered your questions regarding “is bitcoin mining legal?” There are plenty of online resources to help answer additional ‘is bitcoin mining legal in US’ questions if you’d like to learn more.
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