What the IRS Ruling on Bitcoin Does Not Mean

On the 25th of March, 2014, the IRS ruled that bitcoin and other virtual currencies are treated as property, rather than currency, for taxation purposes.

Here's what this doesn't mean.

Apple Now Has to Accept Apps That Can Send Bitcoin And Other Cryptocurrencies

Statement: Apple has been rejecting bitcoin and cryptocurrency related apps due to the 'unclear legal status' of these coins. With this announcement, the legal status is clear, so Apple has no grounds to reject bitcoin and cryptocurrency apps!

Unfortunately not. Apple is still Apple. They generally do what they want with respect to app store approval. Apple will likely continue to block apps that allow transactions with cryptocurrencies, because these apps offer an alternative to Apple's in-app purchase system. 

Bitcoin and Cryptocurrency Companies No Longer Need to Comply with KYC/AML

Statement: Now that bitcoin is property, exchanges and ATMs will no longer need to comply with KYC/AML laws.

No. Firstly, the statement was made by the IRS. This statement does not apply to other federal branches, namely FinCen.

Secondly, most bitcoin exchanges and ATMs still touch fiat. Additionally, many bitcoin exchanges also allow customers to send/receive funds from their bank accounts. Thus, for all of these reasons, they are still required to comply with KYC/AML regulations.

The $5M That The IRS Seized from MtGox Should Now Be Returned

Statement: Bitcoin is property, not money. Therefore, the $5m seized from MtGox should be returned, because MtGox did not deal with money transmission.

No, see above. MtGox dealt with fiat, and thus required an MTL.

In Conclusion

In terms of Apple, KYC, and AML, nothing much has changed. Companies are still required to comply with KYC and AML, and Apple will still be able to create arbitrary app store approval rules. 

At Focus.vc, we are excited to be working with BlockScore, which provides KYC/AML compliance services (as API calls) to a large number of bitcoin and crypto-related companies.