From: Matt Whitlock <bip@mattwhitlock•name>
To: bitcoin-development@lists•sourceforge.net
Subject: Re: [Bitcoin-development] The legal risks of auto-updating wallet software; custodial relationships
Date: Tue, 20 Jan 2015 12:23:14 -0500 [thread overview]
Message-ID: <2236907.ZtrNgikFVR@crushinator> (raw)
In-Reply-To: <20150120154641.GA32556@muck>
On Tuesday, 20 January 2015, at 10:46 am, Peter Todd wrote:
> I was talking to a lawyer with a background in finance law the other day
> and we came to a somewhat worrying conclusion: authors of Bitcoin wallet
> software probably have a custodial relationship with their users,
> especially if they use auto-update mechanisms. Unfortunately this has
> potential legal implications as custodial relationships tend to be
> pretty highly regulated.
>
> Why is this? Well, in most jurisdictions financial laws a custodial
> relationship is defined as having the ability, but not the right, to
> dispose of an asset. If you have the private keys for your users'
> bitcoins - e.g. an exchange or "online" wallet - you clearly have the
> ability to spend those bitcoins, thus you have a custodial relationship.
If you have the private keys for your users' bitcoins, then you are every bit as much the owner of those bitcoins as your users are. There is no custodial relationship, as you have both the ability and the right to spend those bitcoins. Possession of a private key is equivalent to ownership of the bitcoins controlled by that private key.
next prev parent reply other threads:[~2015-01-20 17:36 UTC|newest]
Thread overview: 14+ messages / expand[flat|nested] mbox.gz Atom feed top
2015-01-20 15:46 Peter Todd
[not found] ` <CAHpxFbEoDLMGKB7arHbgB+4kx8BwgcX7nBUZz6yP9k4LjZeu1A@mail.gmail.com>
2015-01-20 17:15 ` Peter Todd
2015-01-20 17:23 ` Matt Whitlock [this message]
2015-01-20 17:40 ` Peter Todd
2015-01-20 17:44 ` Matt Whitlock
2015-01-20 17:44 ` Tamas Blummer
2015-01-20 17:47 ` Matt Whitlock
2015-01-20 17:49 ` Peter Todd
2015-01-20 17:56 ` Tamas Blummer
2015-01-20 17:47 ` Justus Ranvier
2015-01-20 18:48 ` Tamas Blummer
2015-01-20 19:31 ` Justus Ranvier
2015-01-20 21:33 ` odinn
2015-01-20 21:49 ` Roy Badami
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