Quote from: TellerOfTruth on February 20, 2015, 07:54:12 PM

Quote from: RodeoX on February 20, 2015, 07:27:46 PM

If you don't have to pay to get in then it's not a lottery. I suppose you could call it a contest, but there is nothing wagered like a lottery. I doubt any court would find otherwise.

You do not understand the legal definition of "consideration" in this context. You have to pay to buy the mining computer, and electricity to run it, which is your entry fee or "consideration" for the Bitcoin lottery. The value of that entry fee flows to "Bitcoin" as operator of the lottery when you calculate a block to be added to its blockchain - a service vital to the continuation of Bitcoin. If Bitcoin used every single block generated by all miners, it would be "buying" a "service" and would be a business. Instead, a random chance function (leading zeros in the block) is used to award a prize to one single block winner every ten minutes. All other blocks generated by all other losers (which are cryptographically valid but lack the winning zeros) are discarded.

I know it's uncomfortable to acknowledge that Bitcoin mining is a lottery, but legally it is. Protests to the contrary, or silence so far this point from State law enforcement or courts, are irrelevant. Favorable federal legal rulings so far from IRS or DOJ are also irrelevant, since gaming law is handled on a State level.

So far the States have yet to be heard on this point of law - Bitcoin as an illegal lottery. It will not be a good day for Bitcoin when they do.

I'm not a lawyer, but I think even I could win that argument. Heck, I found this definition in your own link: "Consideration may include a fee, a product purchase requirement, or the requirement that the entrant expend extensive time or effort."

None of the costs you mention could ever be claimed to be a fee for participation in a lottery,IMO. If I enter a free raffle at the church I can't claim that since I had to pay bus fare or buy shoes to get to the church It's gambling. Besides, I do not have to buy a computer to mine, I could have used my game PC. Perhaps electricity is part of my rent? There is no one compelling me to spend a penny and bitcoin is not a legal entity or company.

For me the strongest argument is that you are the only person making this claim. No court has said anything like this nor is there a president you point too. I have spoken to multiple accountants with experience in crypt-currency and never even heard of this?