25 UCLA Ent. L. Rev. 41 (2018)
Trifling and Gambling with Virtual Money

handle is hein.journals/uclaetrlr25 and id is 48 raw text is: 

                       VIRTUAL MONEY

                           John   T. Holden*

     Gambling,  in particular sports gambling, is one of the most pervasive
illicit activities in the United States. In contrast to Europe and parts of Asia
that have vast legal networks of both  online and brick and mortar  betting
parlors, the United States has largely confined sports betting to the state of
Nevada,  while tolerating so-called daily fantasy sports in a number of addi-
tional states. Slightly less pervasive, though equally or perhaps more often
associated with illegal activity, are virtual currencies. Indeed, the growth of the
illegal gambling market is being partially fueled by virtual currencies. While
bitcoin garners most of the media attention, often associated with volatile valu-
ations or criminal activity, a variety of smaller scale virtual currencies have also
emerged.  The challenge for judges and an essential prerogative for lawmakers
is to make sense of how to treat virtual currencies under antiquated statutes
and interpretations of what constitutes money.
     Some  of the high-profile cases involving bitcoin-such as United States v.
Ulbricht, and theft from the Mt. GOX exchange  leading to its collapse-have
raised questions as to whether bitcoin is money, or even property, the loss of
which is compensable. Smaller, narrowly used, in-game virtual currencies have
also emerged. Their unique distinction from bitcoin and first generation virtual
currencies is that they have value within games, but purportedly have no value
external to the game per terms of service agreements offered by game makers.
No fewer than seven decisions have been issued addressing these in-game cur-
rencies, finding that despite the existence of secondary markets allowing users
to transfer accounts for fiat currencies, the terms of service agreements control
in determining the in-game currencies to be valueless.

*   Holden is a Visiting Scholar at Florida State University, Department of Sport Man-
    agement. Ph.D., Florida State University. J.D., Michigan State University College of
    Law. The title of this article is derived from a statement made by federal Judge James
    K. Bredar of the district of Maryland in dismissing a case involving virtual currencies
    in the mobile game, Game of War: Fire Age. See Mason v. Machine Zone, 140 E Supp.
    3d 457 469 (D. Md. 2015) (The laws of California and Maryland do not trifle with play
    money, and so Plaintiff's Complaint must be dismissed.). The decision, as well as series
    of related decisions, have created an enormous gap between the intent of the laws de-
    signed to restrict gambling in the United States and the judicial interpretation of those
    laws when transactions are facilitated by non-traditional virtual currencies.

@ 2018 John T. Holden. All rights reserved.

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