Last week US Federal judge Amos Mazzant ruled in favor of the SEC in a case against Trendon Shavers who ran the Bitcoin Savings and Trust of Texas (BTCST). Shavers took in $4.5 million in Bitcoin from investors, promising a 7% return. The SEC alleged that Shavers was running a Ponzi scheme as he was paying out earlier investors with funds from later investors while eventually going bankrupt. Shavers argued that Bitcoin isn’t really currency and no money actually changed hands and is therefore the transactions aren’t regulated by the SEC.
The SEC disagreed, contending that Bitcoins “are both investment contracts and notes, and, thus, are securities.” The judge ruled that Bitcoins are in fact money as they can be used to buy goods and services. If fact, Shavers spent much of the Bitcoin investments on his own living expenses.
In her article in Forbes, Kashmir Hill put it best, when she wrote “Like Tinkerbell the blue fairy turning Pinocchio into a real boy, the judge sided with the SEC, giving Bitcoin his stamp of approval as real world money.”
Binary Options brokers began offering Bitcoin options earlier this year. Brokers had hesitated to add the virtual currency because of market risk associated with extreme volatility. Although still subject to extreme price fluctuations, Brokers became more comfortable as the level of Bitcoin volatility began to subside somewhat.
Now that Bitcoin has gained stamp of the approval as a real currency subject to regulations by the SEC it is bound to gain even more price consistency making it more attractive for investors and Binary Options traders alike. To learn more or to trade Bitcoin binary options visit TradeRush, one of the original Bitcoin brokers.