A federal appeals court has ruled that the U.S. Constitution’s commerce clause applies to cryptocurrencies like bitcoin and other digital currencies, effectively paving the way for more companies to adopt them.
In a 2-1 ruling, the 4th Circuit Court of Appeals in Denver ruled that U.N. Trade Commission regulations regulating the “virtual currency” are unconstitutional, as they infringe on the First Amendment right to freedom of speech.
The court ruled that Bitcoin was “an artificial product that is indistinguishable from other commodities, and the Commission does not have authority to regulate virtual currency as a currency.”
The court said that the FTC regulation is a “contempt of the federal government’s authority under the Commerce Clause,” which applies to all federal laws.
The decision comes after U.K. regulators launched an investigation into whether the digital currency is legal, but the investigation was halted by the British government in July 2017.
The U.R.S.-based cryptocurrency has come under increased scrutiny in recent months, as U.C. Berkeley Law School Professor Andrew Bacevich recently called it a “fraud” and a “threat to the world economy.”
The ruling comes just a week after the U:S.
Court of Federal Claims held that bitcoin is not a currency, and instead a type of “trustless” asset, and that it is subject to the same restrictions as a commodity.