While various criminals have tried it, the "bitcoin isn't money, therefore I can not be guilty of a financial crime" defense never really works out. While the federal government has declared that bitcoin is not legal tender or currency in the same sense that the dollar is currency (the IRS treats bitcoin more like a taxable asset), judges have no problem dinging defendants who use it in a manner consistent with money laundering.

The latest such decision comes care of U.S. District Judge Alison Nathan in Manhattan as she rejected a motion to dismiss two charges against Anthony Murgio related to his alleged operation of Coin.mx. Prosecutors have argued that Coin.mx was an illegal bitcoin exchange that was critical to the functioning of a cybercrime ring; the ring was behind a massive hacking and fraud scheme that managed to scoop the data of 100 million people from the systems of various prominent firms. Most notable among those firms was JPMorgan Chase.

Murgio's motions hinged on the idea that bitcoin does not qualify as "funds" under the federal law prohibiting the operation of unlicensed money transmitting businesses.

As in Jed Rakoff's unrelated 2014 case, the New York judge ruled that the virtual currency met that definition.

"Bitcoins are funds within the plain meaning of that term," Nathan wrote. "Bitcoins can be accepted as a payment for goods and services or bought directly from an exchange with a bank account. They therefore function as pecuniary resources and are used as a medium of exchange and a means of payment."

The decision did not address six other criminal counts that Murgio faces, Nathan wrote.

Brian Klein, a lawyer for Murgio, said he disagrees with the decision.

"Anthony Murgio maintains his innocence and looks forward to clearing his name at his upcoming trial," he added.

Authorities have said Coin.mx was owned by Gery Shalon, an Israeli man who, along with two others, was charged with running the massive hack. That case is ongoing; Shalon has recently retained new council.