Miami-Dade Circuit Judge Teresa Pooler has dismissed a money-laundering case involving an alleged “illegal sale” of bitcoins, after declaring that under the laws of the state, the digital currency is not considered to be a form of money.

Defendant Michell Espinoza was arrested after being accused of selling bitcoins to undercover detectives who told him that they were interested in purchasing $1,500 worth of bitcoins in order to obtain robbed credit card numbers.

Florida law enforcement charged Espinoza with one count of operating as an unauthorized money transmitter and one count of money laundering. A second man, Pascal Reid, was also arrested. Reid has since been sentenced to probation for operating as an unlicensed money broker.

The State had initially charged Espinoza as operating as an unauthorized “money transmitter,” but later amended the term to “a payment instrument seller.” A payment instrument, strictly speaking, refers to “a check, draft, warrant money order, traveler’s check, electronic instrument or...monetary value whether or not negotiable.”

According to Pooler, “Bitcoin does not fall under the statutory definition of ‘payment instrument’...nor does Bitcoin fit into one of the defined categories listed.”

“At this time...attempting to fit the sale of Bitcoin into a statutory scheme regulating money services businesses is like fitting a square peg in a round hole.”

The judge then dismissed the money laundering charges, declaring that under the current regulations of the state, Bitcoin and other virtual currencies are not considered money.

“The Court is not an expert in economics, however, it is very clear, even to someone with limited knowledge in the area, that Bitcoin has a long way to go before it the equivalent of money,” a section of Pooler’s order read.

Pooler further noted that the case was too vague to apply to a digital currency, and explained that the court cannot punish the defendant for selling his property to another.

“This court is unwilling to punish a man for selling his property to another, when his actions fall under a statute that is so vaguely written that even legal professionals have difficulty finding a singular meaning,” she stated.

The case, which was closely observed by the Bitcoin community since the first hearing on May 27, is said to be the first prosecution to define the legality of Bitcoin in the United States. This digital currency-related money-laundering case garnered extra interest since defense witness Charles Evans, a Barry University economics professor, was paid $3,000 worth of Bitcoin for his testimony.

Evans told the court that under state law Bitcoin is closer to a property than an actual coin because of the digital currency’s lack of dependence on a centralized or public authority. Comparing the action to trading “poker chips,” Evans made the case that dealing in Bitcoin is simply bartering.

Pooler stated, “This is the most fascinating thing I’ve heard in this courtroom in a long time.”

Bitcoin, which is considered an intangible asset in many countries, including Canada, Australia and Croatia, is still not considered a legal currency in most regions around the world, including the United States. While many countries around the world haven’t establish a proper regulatory framework for the digital currency, the Miami-Dade money-laundering case concludes that Bitcoin is not considered a legal currency in the United States.