Bitcoin has been one of the most popular payment systems of the past year, but thanks to the Stamp Payments Act, they might have met their match.
The Stamp Payments Act of 1862 forbids any American from using a token, note or check that’s worth less than $1. The problem is Bitcoin—which is essentially a digital token condensed into tiny values that are theoretically worth less than $1—falls into that category, according to a Congressional Research Service report. There has been talk over the past two years about the Stamp Act possibly hindering Bitcoin’s use, and Darrell Duffie, a professor at Stanford University, definitely thinks so. “A lot depends on whether the government becomes anxious to move against Bitcoin,” Duffie says. “Whether this is the most appropriate statute under which to control Bitcoin, I’m not so confident.”
This presents a problem for current businesses that use Bitcoin, but Derek Dion, a University of Illinois law student, believes that the government won’t take any action in the near future and will instead provide a way for companies to comply with these federal laws.
“I doubt the government will use anything like the Stamp Payments Act to do this,” he says. “Instead, they will use the common criminal statutes."
It’s kind of scary that a 19th century law is affecting modern day cryptocurrency.