Bitcoin is taxed the same as personal property, so when you sell it for a profit you have to pay capital gains taxes. That leads me to believe that there is already legal recognition of a virtual currency as property, but not necessarily currency.

yeah, honestly i don't get it. I thought the feds had already explicitly declared that bitcoin wasn't valid currency. How can you do "money laundering" by taking something that isn't a currency and moving its location, and at no point converting it into something that is recognized as currency?

> I thought the feds had already explicitly declared that bitcoin wasn't valid currency.

No, they didn't. You are probably confusing a determination of what category it falls into in tax law as having a broader meaning that it does.

> How can you do "money laundering" by taking something that isn't a currency and moving its location, and at no point converting it into something that is recognized as currency?

The US “money laundering” statute concerns primarily “monetary instruments”, whose definition includes (among other things) “investment securities”. Nothing has to be or be converted to currency. See 18 U.S.C. § 1956.