Apparently "bitcoins are not money" is not a legitimate defense against money laundering charges.
Ross Ulbricht, who prosecutors said was known online as "Dread Pirate Roberts," had claimed he did not conspire with Silk Road users who might have broken the law by completing transactions on the now-defunct website, using the digital currency bitcoin. He also claimed he was not involved in money laundering because bitcoins are not money.
Last time I checked money laundering can easily involve non-monetary instruments. Stock certificates, real estate, gambling, gaming, inflated product pricing, ...
Bitcoins being an investment instrument can easily be used in money laundering. You could use monopoly chance cards to commit money laundering in a fake gaming scheme.
In essence the whole definition of money laundering is to convert dirty money into clean money via some intermediary or washing mechanism which can create legitimate money say from an online trading desk dealing in bitcoins.
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