E-Gold Claims US Officials Buried Key Report in 2008 Landmark Crypto Ruling

A court filing alleges federal government suppression of an OFR review led to crypto businesses being defined as money transmitters.

AccessTimeIconJul 3, 2020 at 11:30 a.m. UTC
Updated Sep 14, 2021 at 8:59 a.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global event for everything crypto, blockchain and Web3.Register Now

A defunct digital currency project that was a precursor to bitcoin has claimed the U.S. government suppressed crucial evidence in a 2008 landmark case that has since shaped the cryptocurrency industry.

  • E-Gold's former directors filed a petition Tuesday for a writ of coram nobis – in which the court changes the original judgment upon discovery of a fundamental error – at the District of Columbia court.
  • Founded in 1996, E-Gold allowed users to trade digital units backed by precious metals. At its peak, the company held around $85 million in gold.
  • The U.S. government charged E-Gold with being an unlicensed money transmitter in 2007 and the project's directors pleaded guilty in 2008.
  • The ex-directors now claim in court the federal government unlawfully concealed a 2006 review from Florida's Office for Financial Regulation (OFR) so it "could make an example" of E-Gold.
  • Per the filing, the OFR review said E-Gold did not count as a money transmitter because the gold-based asset was closer to a commodity than a fiat currency under state law.
  • E-Gold's former directors claim the court's judgment would have been substantially different had they been allowed access to the OFR review
  • The E-Gold case effectively extended the definition of "money transmitter" in the U.S. to include any system that stored and transferred value.
  • Many crypto businesses subsequently have had to be regulated as money transmitters in individual states if they want to operate legally in the U.S.

See the full filing below:

Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.


Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.