After being one of the most interesting adopters of Bitcoin, the Electronic Frontier Foundation (EFF) has decided to stop taking donations in the cryptocurrency and flush current holdings. In their statement, the EFF stated that they will be pouring their accumulated (and all future accumulated bitcoins) into the Bitcoin faucet.

In a statement on their website, the EFF addresses their new stance on Bitcoin donations and their use of them as alternative donations,

For several months, EFF has been following the movement around Bitcoin, an electronic payment system that touts itself as “the first decentralized digital currency.” We helped inform our members about this unique project through our blog and we experimented with accepting Bitcoin donations for several months in an account that was started by others.

However, we’ve recently removed the Bitcoin donation option from the Other Ways to Help page on the EFF website, and we have decided to not accept Bitcoins.

Amid the reasons given, the EFF makes first and foremost their mission to aid people with legal issues arising out of the use of computers and communication. They note that Bitcoin raises a great deal of legal questions about the creation and maintenance of alternate currencies and as a result runs afoul of some very leaky bureaucratic territory. As a result, to indemnify the organization from the possibility they might get drawn into legal battles involving Bitcoin and themselves, they’ve decided to eschew personal involvement with the currency.

They have also noted that they did not want to mislead their supporters into believing that EFF therefore endorsed Bitcoin by taking them as donations. Instead, it was their intent to embrace and innovate a new and interesting currency that used elements of computer technology that the EFF is well known for being part of: cryptography, anonymity, distributed frameworks, etc.

As Bitcoin gained in popularity, it started to garner both instability in market and suffers growing pains; suddenly it’s much more of a “real thing” and the EFF perhaps needs to distance themselves from it until its established. There’s also the factor that bitcoins are common amid digital black markets and used in criminal enterprise due to their alternative market presence and usability as an anonymous transaction currency.

The EFF may need to be clean of bitcoins to defend someone from a case involving their use.

The virtual cryptocurrency has been suffering somewhat as of late after the technology media began to notice its presence. Bitcoin has been with since 2009 when it was introduced and speculators have been mining it since then. Due to the fundamental structure of Bitcoin, mining coins is easy at first but swiftly becomes logarithmically more difficult (as it depends on the discovery of extremely long cryptographic hashes.) As a result, the population of bitcoins currently is stabilizing and somewhat hoarded—thus likely the push to get the media involved: if too few people are using bitcoins, they possess little value.

The currency has also seen some social and economic instability that makes it an early adopter culture. Recently, a deep value crash occurred on a virtual exchange due to a hacked account attempting to dump coin onto the market (thereby crashing the value) and buy the coins back at a very low price. This mimics a natural behavior of markets, but it also illuminated some of the issues present in the current implementation of Bitcoin markets and exchanges due to so few adopters being in the exchanges.

Perhaps recent issues will permit the construction of further frameworks that can take advantage of the cultural coding, anonymity, and distributed power inherent in the underlying features of Bitcoin; but it may take some time and several cultural shifts to see that happen.