Study of Bitcoin’s Legality and Related Challenges

Bitcoin is a cryptocurrency and a worldwide decentralized payment system. The network is conducted through peer-to-peer transactions and these transactions are verified by using cryptography technology. In this paper, we present a systematic survey that covers the security and privacy aspects of Bitcoin.

The purpose of this research is to remark the Bitcoin, we start by presenting an overview of the Bitcoin protocol and its major components along with their functionality and interactions within the system. This article will now try to define bitcoin in a way that might shed some light on it. The Bitcoin notional unit of exchange created by the Bitcoin system can be further fractionated (down to a "Satoshi"). And this article aims to describe how Bitcoin functions.

The purpose of this paper is twofold. First, we discuss how the law might regulate bitcoin and other cryptocurrencies to provide the benefits, ranging from low-cost international money transfers and decentralised resilient operation to competitive innovation, while mitigating the harms –specifically the use of cryptocurrencies in extortion, money laundering and other crimes, and the difficulty that crime victims experience in getting redress. We show that where the relevant case law is used as a basis, it becomes much easier to track stolen bitcoins than previously thought. Second, towards regulation was to bring bitcoin exchanges within the financial system by applying anti-money-laundering (AML) regulations to them. Finally, we discuss many technical and legal challenges surrounding Bitcoin as a digital currency.