There is a lot of information on this subject available online, and the legality of bitcoin depends on who you are, and what activities are involved. Three categories of bitcoin users exists, more than one may apply to an individual, and each one has somewhat different legal considerations.
Bitcoin Users
These are individuals that acquire bitcoins to either hold or spend (use). Under the Financial Crimes Enforcement Network (FinCEN) guidance, individual users who simply exchange bitcoins for goods and services are using it legally.
FinCEN: “A person that creates units of this convertible virtual currency and uses it to purchase real or virtual goods and services is a user of the convertible virtual currency and not subject to regulation as a money transmitter.”
Bitcoin Miners
According to FinCEN guidance, people creating bitcoins and exchanging them for fiat currency, there appears to be a good amount of uncertainty.
FinCEN: “By contrast, a person that creates units of convertible virtual currency and sells those units to another person for real currency or its equivalent is engaged in transmission to another location and is a money transmitter.”
Miners seem to fall into this category, which could theoretically make them liable for MTB classification, but it appears that FinCEN may be leaning away from this categorization according to this statement:
FinCEN: “In undertaking such a conversion transaction, the user is not acting as an exchanger, notwithstanding the fact that the user is accepting a real currency or another convertible virtual currency and transmitting Bitcoin, so long as the user is undertaking the transaction solely for the user’s own purposes and not as a business service performed for the benefit of another. A user’s conversion of Bitcoin into a real currency or another convertible virtual currency, therefore, does not in and of itself make the user a money transmitter.”
While the above could put most bitcoin miners more at ease, it isn’t clear if mining pools or services would be seen differently. This isn’t a formal FinCEN opinion, and it could change in the future.
Bitcoin Exchanges
Exchanges are defined as MTBs.
FinCEN: “In addition, a person is an exchanger and a money transmitter if the person accepts such de-centralized convertible virtual currency from one person and transmits it to another person as part of the acceptance and transfer of currency, funds, or other value that substitutes for currency.”
Depending on your activity involving bitcoin, you should investigate the legal implications. More information can be found here: FinCEN website.