Bitcoin Is Not an Investment — It Is a Protocol of Freedom. Why Regulators Cannot Ban What They Cannot Control | Mythmakers vs. Myth Hunters

BITCOIN IS NOT AN INVESTMENT. IT IS A PROTOCOL OF FREEDOM. WHY REGULATORS CANNOT BAN WHAT THEY CANNOT CONTROL

RUBRIC: MYTHMAKERS VS. MYTH HUNTERS

DISCLAIMER

This material is an analytical review prepared by the editorial board of the journals “Kafedra” and SforNews as part of the rubric “Mythmakers vs. Myth Hunters.” The material is based on open data, official documents, and public statements. It does not constitute legal advice, investment recommendation, or call to action. The authors do not provide advice on the purchase, sale, or storage of any assets, including cryptocurrencies.

The purpose of this material is to verify public narratives, check statements by regulators and financial institutions for factual accuracy, and document discrepancies between words and actions. All conclusions are probabilistic and analytical in nature. The editorial board bears no responsibility for any financial or legal decisions made based on the content read.

The material contains critical analysis of the actions of government bodies and financial institutions. It addresses regulators and their followers without familiarity but with the necessary degree of skepticism required by journalistic ethics when working with public statements that affect citizens’ rights.

INTRODUCTION: WHAT THE DISPUTE IS ABOUT

In 2008, Satoshi Nakamoto published the White Paper, in which it is written in black and white:

“A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution.” [3]

Bitcoin was created as a system of electronic cash for direct P2P payments without intermediaries. There was no task of “investment asset,” “digital gold,” or “instrument for speculation” in the original design.

However, over the 18 years of the technology’s existence, a fundamental distortion has occurred. Bitcoin was captured by financial institutions, transformed into a speculative instrument, embedded in the banking system, and burdened with restrictions that contradict its architecture.

We are recording the moment when the perversion of the author’s will has reached its apogee — and regulators take the stage with demands that are technically unenforceable, legally dubious, and logically absurd.

PART ONE: BITCOIN IS PROPERTY. THEREFORE, IT IS SUBJECT TO PROTECTION

What Russian law says:

What judicial practice says:

Judge of the Supreme Court of the Russian Federation Evgeny Rudakov stated at the XIII St. Petersburg International Legal Forum: “Courts are now confidently moving towards recognizing digital currency as property and the need to extend all norms of criminal procedure law to it. They make decisions on the arrest or confiscation of digital currency, although the Criminal Procedure Code and the Criminal Code of the Russian Federation do not directly provide for this” [1]. Deputy Head of the Investigative Department of the Ministry of Internal Affairs of the Russian Federation Danil Filippov added: “For investigative bodies, digital currency became property as soon as the first statement about the theft of bitcoins was filed” [1].

What state logic says:

Lawyer Igor Baranov noted the problem: “Due to the lack of comprehensive regulation, it is sometimes impossible to predict what the court will do. The bill concerns criminal law. But why can’t digital currency be immediately recognized as property in other areas of law? And this can lead to a conflict of norms and court decisions” [1].

What logic says:

This is not a “legal conflict.” This is a political decision: to allow ownership but prohibit free transfer. The state wants to control bitcoin at the entry and exit points (exchanges, exchangers, banks), but cannot control the protocol itself.

Architectural conclusion:

If bitcoin is property, it is subject to protection like any other property. The owner has the right to transfer it by any available means — like a package, like cash, like any other object of ownership. And any restriction of this right must be legally justified, not imposed through “recommendations” from regulators.

PART TWO: VIOLATION OF CONSTITUTIONAL RIGHTS AND INTERNATIONAL NORMS

1. Right to Private Property (Article 35 of the Constitution of the Russian Federation)

Article 35 of the Constitution of the Russian Federation states [2][7]:

“1. The right to private property is protected by law.
2. Everyone has the right to own property, to possess, use, and dispose of it both individually and jointly with other persons.
3. No one shall be deprived of their property except by a court decision.
4. The right of inheritance is guaranteed.”

Violation: The requirement to inform tax authorities about the possession of digital currency as a condition for judicial protection creates inequality between holders of digital currency and other owners [5]. The Constitutional Court of the Russian Federation in Resolution No. 2-P recognized that such an approach “does not comply with constitutional requirements” and “negatively affects the stability of civil turnover” [5][10].

2. Right to Judicial Protection (Article 46 of the Constitution of the Russian Federation)

Article 46 of the Constitution of the Russian Federation guarantees everyone judicial protection of their rights and freedoms.

Violation: The refusal of judicial protection for property claims related to digital currency possession, if the owner has not informed the tax authorities, was recognized by the Constitutional Court of the Russian Federation as unconstitutional [5][10]. As the Court stated, “the possibility of judicial protection may be nullified in practice due to the ambiguous understanding of digital currency as an object of civil rights subject to judicial protection” [5].

3. Right to Equality Before the Law (Article 19 of the Constitution of the Russian Federation)

Violation: The different approach to protecting the rights of digital currency holders depending on whether it was obtained through mining or other means creates discriminatory conditions [5][10].

4. Right to Privacy of Private Life (Article 23 of the Constitution of the Russian Federation)

Violation: The requirement to disclose information about ownership of digital currency and operations conducted with it intrudes into the private lives of citizens. As the Constitutional Court noted, the introduction of such regulation “integrates this virtual asset… into the national legal reality” [5], which is essentially a forced identification of owners.

5. Right to Peaceful Enjoyment of Property (Article 1 of Protocol No. 1 to the ECHR)

The European Convention on Human Rights, ratified by Russia, guarantees [4][9][14]:

“Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law.”

Violation: Restrictions on the transfer of bitcoin, the establishment of limits, the requirement to undergo KYC procedures through banks — all of this constitutes interference with the right to peaceful enjoyment of property. According to the European Court of Human Rights’ clarifications, such interference must be proportionate to the aim pursued [14]. Requirements that make the use of bitcoin practically impossible without banking intermediation cannot be considered proportionate.

6. Right to Own Property (Article 17 of the Universal Declaration of Human Rights)

The Universal Declaration of Human Rights [3][13]:

“1. Everyone has the right to own property alone as well as in association with others.
2. No one shall be arbitrarily deprived of his property.”

Violation: Confiscation of bitcoin without private keys is arbitrary deprivation of property, as it is technically impossible to seize the asset without the owner’s consent, but legally a “legal cloud” is created [5][6] that makes the asset devalued in the eyes of regulated institutions.

PART THREE: ILLEGITIMACY AND UNENFORCEABILITY OF REGULATORY DEMANDS

1. Technical Unenforceability

As the Constitutional Court of the Russian Federation noted, “the decentralized nature of digital currency… control over which is extremely difficult” [5]. Deputy Head of the Investigative Department of the Ministry of Internal Affairs of the Russian Federation Danil Filippov admitted: “We can arrest it even on a foreign crypto exchange. But since there are no crypto exchanges in Russia, and sanctions have been introduced against our country, we cannot always obtain the arrested or confiscated property” [1].

Key problem: The court may issue a confiscation order, but without the private keys it is technically unenforceable. Bitcoin is not on an account in a bank — it exists in a decentralized network, and access to it is controlled only by the owner of the private key.

2. Illegitimacy of KYC/AML Requirements Through Banks

Bitcoin was created to eliminate financial intermediaries. The bank in this scheme is a third party that inserts itself between the user and the network, contrary to Satoshi’s original goal.

When regulators require all bitcoin operations to go through banks, they are not creating “infrastructure,” but introducing an artificial restriction. The bank does not add value to the transaction verification process. Its role is exclusively supervisory and fiscal.

3. Critical Impossibility of Identifying Owners

How to catch the owners of addresses? Technically — no way. The blockchain is an open ledger, but addresses do not contain owners’ identification data. Without mandatory registration of all wallets (which is technically impossible), regulators cannot identify the owners of “dormant” addresses.

This is precisely why the plaintiff in the Noah Doe case used not technical means, but a legal fiction — declared the addresses “abandoned” and attempted through the court to obtain rights to them. This is an admission that technical control mechanisms do not exist.

PART FOUR: THE NEW YORK PRECEDENT — ATTEMPTING TO REWRITE THE BLOCKCHAIN THROUGH COURT

The Noah Doe v. John Does Case (Index No. 153119/2026) [4]

Plaintiff: Noah Doe and two anonymous Wyoming LLCs.

Defendants: 39,069 bitcoin addresses, which the plaintiff declared “abandoned” and demands transfer of rights to ~3.8 million BTC.

Plaintiff’s Method:

What the facts say:

Legal Defense:

PART FIVE: WHY REGULATORS CANNOT BAN WHAT THEY CANNOT CONTROL

Argument No. 1: The Bank is Not a Protocol Participant

Bitcoin was created to eliminate financial intermediaries. The bank in this scheme is a third party that inserts itself between the user and the network, contrary to Satoshi’s original goal.

Argument No. 2: Court Decisions are Unenforceable

Proven by the Noah Doe case: a court may issue a decision on confiscation or transfer of rights, but without the private keys it remains just paper [4]. As The Digital Chamber noted in its amicus brief, “a paper judgment cannot move Bitcoin without private keys” [4].

Argument No. 3: KYC/AML Requirements Violate the Right to Privacy

A user who bought bitcoin in 2013 and has since stored it in a cold wallet is not required to undergo identification procedures just to continue storing their property [5].

Argument No. 4: “Dormancy” is Not “Abandonment”

As Ian Cohen rightly noted in his amicus brief, “Abandonment requires intentional relinquishment of ownership and an external act manifesting that intent. Dormancy alone is not abandonment” [4]. Cold storage, long-term investment strategies, inheritance, concern for privacy — these are signs of ownership, not abandonment.

Argument No. 5: Laws Contradicting International Norms

Requirements that make the use of bitcoin practically impossible without banking intermediation come into conflict with Article 1 of Protocol No. 1 of the ECHR [4][9][14], which guarantees the right to peaceful enjoyment of property. Any interference must be proportionate to the aim. If the aim is combating money laundering, then control should be focused on professional market participants, not on all holders of digital assets [5].

PART SIX: ARCHITECTURAL CONCLUSION — RETURNING TO THE SOURCES

What we propose:

How to legalize a law that contradicts international legal norms:

FINAL CONCLUSION

Mythmakers try to present bitcoin as a “speculative instrument” that needs to be controlled, regulated, and taxed. But bitcoin’s architecture does not allow this.

You cannot prohibit what you cannot control. You cannot control what is decentralized.

Courts can issue decisions, but they cannot force the blockchain to rewrite the owner. Regulators can demand KYC, but they cannot identify addresses without the owners’ consent.

The question is not “how to control bitcoin.” The question is “why do we allow ourselves to be controlled using bitcoin”.

SOURCES

The material was prepared by the editorial board of the journals “Kafedra” and SforNews based on open sources. When citing, reference to the original source is mandatory.