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bitcoin regulation

Bitcoin regulation in Europe: “it’s too early”

bitcoin regulation

During a recent event held by the European Parliament, members talked about new technologies including the Blockchain and Ethereum and Bitcoin Regulation.

According to them, the European Parliament will have to regulate and monitor the new tech but “it’s too early to intervene at this stage, because we as legislators don’t yet see sufficiently clearly to know what the main issues are going to be – so in order to not to stifle innovation, we don’t want it to be now.””, said MEP Jakob von Weizsäcker.

So, the EU wants just to monitor blockchain and smart contracts in order to allow developers doing their job.

Also, MEP Eva Kaili from Greece explained that regulation is necessary to protect citizens, but EU doesn’t want to suffocate innovations.

“[In] 2008 when the crisis started in the European Union, especially in my country [Greece], people lost trust in banks and in the politicians. I woundn’t blame them because we didn’t protect them and the reaction was that some young people that we don’t really know discover this technology that actually makes unnecessary to have banks, politicians and intermediaries. So the potential is there, but it is still under progress”.

Also, she continues by saying the following:

“Blockchain is not just bitcoin and bitcoin is not just blockckhain. We need to understand how to protect citizens because if we help them trust this technology, they will actually start to using it. I do believe that banks will outsource a lot of their services,” she said.

Bitcoin regulation to regain trust by citizens

“We’ll have to educate citizens on how to use it […] Hopefully, [bitcoin regulation] will come and we’re going to try to protect the technology and not to stop it. I know that usually politicians and banks don’t want to change and they want to keep control, but I think this technology is unstoppable and we have to give control back to the citizens and maybe this way we can regain some trust,” Kaili argues.

Watch the full conference video here.

 

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Amelia Tomasicchio
polish_bitcoin

Polish Bitcoin regulators recognized it within the country

Polish Bitcoin regulators decided to recognize the digital currency within the country.

In fact, the country’s Central Statistical Office (GUS) revealed its decision to recognize the trading and mining of digital currencies as an official economic business in Poland.

This is the reason why from now on companies active in the Polish industry are be able to register themselves with the agency.

Businesses who are involved in cryptocurrency trade and production activities can now apply to obtain an official PKD 64.19.Z registration, the GUS explained in a press release.

This news highlights a significant step forward for industry workers in Poland where currently there isn’t an official regulation or legislation about neither bitcoin or other digital currencies.

Earlier this year the Polish Ministry of Finance released a few documents that expressed the status of legality for bitcoin and cryptocurrencies in general.

Also, in a statement published back in November, the finance ministry commented what follows:

“there is a lack of a general, legal definition of virtual currency in international, European and national law”.

This explains that digital currencies are subjected to income tax, even if they are not subject to any separate regulation according to the Polish legislation.

Polish ministry also commented:

“It should also be stressed here that their use in Poland is fully legal.”

Polish Bitcoin studies

To explore the legal and financial implications of the use of the Polish Bitcoin use, government of Poland has created a new group of blockchain and virtual currencies experts.

This Polish Bitcoin task force was established under the surveilance of the Polish Ministry of Digital Affairs, and according to thePolish government’s program titled From Paper To Digital Poland that was written by the Cabinet back in June 2016.

This task force will be responsible to prepare analyses for use by other government agencies in their legislative work and the possible chance of a Polish Bitcoin and digital currencies regulation is one of its goals and interests.

Open your free digital wallet here to store your cryptocurrencies in a safe place.

Amelia Tomasicchio

Japan Bitcoin Regulation for 2017

Japan Bitcoin Regulation

Japan Bitcoin Regulation will take place in 2017 and it wants to drop an 8% sales tax on Bitcoin purchases.

This move will take effect in July 2017, according to a document published by CoinDesk.

Although the proposal has yet to be approved by senior Japanese government, an annual tax document written by the ruling Liberal Democratic Party and the Komeito party was revealed today. Thanks to this document now we know more details on the proposal suggested back in October by the Ministry of Finance and the Financial Services Agency.

The tax remains in place today.

If approved by the Cabinet, the plan will institute a period of grace in June 2017, with the tax exemption becoming official the following month.

The document just released is the result of discussions among government stakeholders first reported by the regional news service called Nikkei.

Local startups have already responded positively to this Japan Bitcoin regulation.

CEO of exchange service Quoine, Mike Kayamori, commented that the plan to drop the sales tax was expected, but it represents a good message to the cryptocurrency community.

Kayamori explained to CoinDesk:

“It’s a huge relief for us. Customers don’t have to pay tax for each transaction. Hope this becomes standard practice.”

This move follows a very busy year for Japan on the exchange front, as the government decided to request registration for all the companies that handle bitcoin sales within the Japanese country.

Discussions around exchange regulation began last year when government ministers tried to obtain information from exchange services.

Also, a deliberations took place last year because of the collapse of Mt Gox, a bitcoin exchange imploded in 2014, causing hundreds of millions of dollars lost by the exchange users.

Document originally shared by CoinDesk.com on Scribd. Unfortunately it is available only in Japanese language.

Open your free digital wallet here to store your cryptocurrencies in a safe place.

Amelia Tomasicchio
bitcoin users

Uganda Bitcoin Regulation

A UN organization related to criminal justice problems published today a few details about a new meeting on bitcoin and digital currencies with the aim of a Uganda Bitcoin Regulation.

Organized in Kampala on 7th July, the meeting was supported by the United Nations African Institute for the Prevention of Crime and the Treatment of Offenders (UNAFRI), the Bank of Uganda and the University of Birmingham Law School.

Dr. Maureen Mapp of the University of Birmingham Law School who partecipated at the event, explained to CoinDesk that the main goal of that event was establishing a basis for a Uganda bitcoin regulation.

Uganda will be one of the first African countries to regulate bitcoin.

Also, Mapp said the effort grew out of a digital currency research project realized  with the Commonwealth Secretariat that showed her how Ugandan public officials didn’t know anything about the benefits and risks of the use of virtual currencies.

“I was inspired to engage with policy makers and regulators in order to investigate whether states could develop policies and regulation that encourage innovation while protecting the private rights and interests of users of virtual currencies.”

The goal, she explained, was building awareness and creating a good basis for future discussions.

Thanks to the Ugandan central bank and UNAFRI, Mapp began to contact a few stakeholders in Uganda to put together what became the meeting held in Kampala.

Among the outcomes of the meeting is a think tank dedicated to the “technological, policy, pluralist, ethical and legal issues” about digital currencies, with the organizations and representatives who attended the July meeting.

Those involved also developed a draft for future discussions between private and public stakeholders, which was published earlier this month by UNAFRI.

Next steps will include the creation of a second meeting, set to take place on the same date in 2017.

“The legal and regulatory environment is moving towards embracing the technology so as to harness its benefits and to promote innovation,” she explained.

Source: Coindesk.com

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Amelia Tomasicchio

Switzerland Bitcoin Regulation will arrive next year

Switzerland Bitcoin Regulation might arrive next year.

Recently its national railway service “have jumped on the bitcoin bandwagon”, as explained by Coindesk, so now it’s time for Switzerland to start regulating fintech and digital currency.

A few days after the Swiss railway-related announcement, as SBB decided to sell bitcoin through its network of ticket kiosks – the Federal Department of Finance (FDF) announced its plans to regulate fintech with the goal of introducing a new regulation next year.

Key elements include plans for a new kind of license geared specifically toward fintech companies and a so-called regulatory “sandbox” for experimental firms. Under the proposed regime, the Financial Market Supervisory Authority would become the primary regulator of fintech firms working in Switzerland.

In a press release, the FDF explained that it will guide more researches about bitcoin and other digital currencies and it will study the distributed ledger broader applications .

The company explained:

“The FDF should conduct additional clarifications in cooperation with the interested authorities on reducing further barriers to market entry for fintech firms, also those outside financial market law (e.g. legal treatment of virtual currencies and assets).”

During a recent speech, Ueli Maurer, Swiss Finance Minister, commented that the proposed Switzerland Bitcoin regulation would help to attract more brands – even if the nation positive attitude has already attracted the attention of several blockchain-related startups to make their home in the country.

“We assume that with the steps we have prepared and the commitment we have to the overall financial services industry we can provide a solution that puts us among the top (countries) in the world that regulate this,” he explained.

Read more here about the Switzerland involvement in the fintech sector. 

<img src="/images/SwitzerlandBitcoinRegulation.jpg" alt="Switzerland Bitcoin Regulation" height="264" width="350" />

Open your free digital wallet here to store your cryptocurrencies in a safe place.

Amelia Tomasicchio

Australian commission said blockchain can help governments regulation

On February 15th Greg Medcraft, chairman at Australian Securities and Investments Commission (ASIC), stated that the blockchain can have “profound implications” on how government regulates the markets.
During the Official Monetary and Financial Institutions Forum Roundtable held in London, in fact, Medcraft commented that regulators need to better understand this technology before thinking how to regulate it. 

How to adopt the Blockchain

Medcraft also said that if capital markets will adopt the use of the blockchain it will be able to improve market efficiency and the access to markets, decrease fees and help transactions transparency.
“Blockchain will have profound implications for how we regulate. We will need to find the right balance between speed of execution and streamlining of business processes. As regulators and policy makers, we need to ensure what we do is about harnessing the opportunities and the broader economic benefits, not standing in the way of innovation and development.”
Medcraft also spoke about how Australian securities regulators act, talking about surveillance of firms, products released in the market and the development of methods to involve the blockchain.
“We are working to understand how enforcement action can be taken where a transaction entered into here or overseas is recorded in the blockchain”, he said.

Australia is in the vanguard

Previously this year, the Australian Stock Exchange (ASX) revealed its plans to adopt the blockchain for trades clearing and settlement.
To do so, the ASX wants to create its own private blockchain with the partnership of Digital Asset Holdings (DAH).
The first phase of this program will run at the end of 2016 and will replace ASX’s existing trading and risk management systems.
To know more about this project, you can read the full press release here.

Open your free digital wallet here to store your cryptocurrencies in a safe place.

Amelia Tomasicchio

Japan wants to regulate Bitcoin as Currency

Yesterday we read about the decision of an American judge to define bitcoin as property, as according to him bitcoin is a intangible personal property rather than a currency.

This is a very important matter on which lots of words have been spent since Satoshi Nakamoto invented this cryptocurrency. In fact, this definition has a lot of implications on how bitcoin is regulated, especially in terms of VAT and taxation in general.

Well, today Japanese regulators stated the decision to propose bitcoin among the methods of payments, so to define the digital cryptocurrencies as conventional currency.

In fact, Japan’s Financial Services Agency (FSA) wants to make “revisions to legislation that would classify digital currencies as fulfilling the functions of currency”, reported Coindesk.
At the moment Japan recognizes bitcoin as a property and not as a currency, but:
“Under the FSA’s proposed definition, virtual currencies must serve as a medium of exchange, meaning that they can be used to purchase goods and services. They must also be exchangeable for legal tender through purchases or trades with an unspecified partner”, said an article by Nikkie.
This possible modification might be submitted during the current legislative session of the Japanese legislature which runs from 4th January to 1st June, even though this it is not official yet.

About the author: Amelia Tomasicchio is a writer and a journalist of Bitcoin-related news and articles. She started writing about Bitcoin in 2014 and she graduated in Rome with an essay about movie industry related to Bitcoin.

Open your free digital wallet here to store your cryptocurrencies in a safe place.

Amelia Tomasicchio

European Union wants to monitor virtual currencies

On February 2nd the European Commission announced the decision to propose a new regulation for digital currency exchanges and wallet service providers.
In charge of this will be the European Council that has a mandate to do so by next June.

The objective of the new rules will be “to help identify the users who trade in virtual currencies” and also put an end to “the anonymity associated with such exchanges“,

These were the words of Valdis Dombrovskis during yesterday’s press conference: 

By June at the latest we will propose measures to have better control of payment forms such as virtual currencies and anonymous pre-paid cards.” 
Dombrovskis continued by saying that the Commission wants to control and maybe prohibit transactions from high-risk countries that enter the EU: “In June the Commission will come up with an EU blacklist of such countries“, he said. 

Dombrovskis previously commented: “We must cut off terrorists’ access to funds, enable authorities to better track financial flows to prevent devastating attacks such as those in Paris last year, and ensure that money laundering and terrorist financing is sanctioned in all Member States. We want to improve the oversight of the many financial means used by terrorists, from cash and cultural artefacts to virtual currencies and anonymous pre-paid cards, while avoiding unnecessary obstacles to the functioning of payments and financial markets for ordinary, law-abiding citizens”.

So this initiative clearly aims at fighting the potential use of virtual currencies by terrorists or criminals, although there isn’t so much evidence of such use.
In fact, a few days ago Europol concluded that there is no connection between Bitcoin and terrorism: “Despite third party reporting suggesting the use of anonymous currencies like Bitcoin by terrorists to finance their activities, this has not been confirmed by law enforcement”, said Europol.

Virtual currencies and their underlying technologies can provide faster and cheaper financial services, and can become a powerful tool for deepening financial inclusion in the developing world,” said IMF Managing Director Christine Lagarde, who presented IMF paper at the World Economic Forum, in Davos, during the panel Transformation of Finance.

A conclusion of the report is that virtual currencies fall short of the legal concept of currency or money. While acknowledging that there is no generally accepted legal definition of currency or money, the authors note that both are associated with the power of the state to issue currency and regulate the monetary system.

About the author: Amelia Tomasicchio is a writer and a journalist of Bitcoin-related news and articles. She started writing about Bitcoin in 2014 and she graduated in Rome with an essay about movie industry related to Bitcoin.

Open your free digital wallet here to store your cryptocurrencies in a safe place.

Amelia Tomasicchio

Australia investigating banks for anti-competitive behavior when closing Bitcoin company accounts


Australian authorities are looking into the bank account closures of several Bitcoin companies over the last few years. Specifically, the investigation is looking at anti-competitive behavior. Over the last year, bank actions have increasingly embraced blockchain technology instead of shunning it in the form of bank account closures. Though this type of account closure, for simply being associated with Bitcoin, is a common occurence in the United States, China, and some European countries as well, the Australian authorities are the first to look into at scale – a harrowing victory for those using blockchain technology. The Australia Competition and Consumer Commission (ACCC) chairman, Rod Sims, told the Australian Financial Review:

We are asking the banks why they acted as they did and what contact there was between them.

If ground reports from major Bitcoin companies such as BTC-e and OKCoin, that lost their accounts at the National Australia Bank, are to be believed, the contact was sparse and uninformative. Sims confirmed that the investigation had been ongoing for some time. Australian Senator Matthew Canavan also commented on the investigation:

We have strong laws against one business obstructing another business competing against it. These laws are even tougher for those companies that have the privileged position of a significant market share. Our banks wield great influence in the market and they have a great responsibility under our laws to not misuse that position. I am not sure if that has happened in this instance but there is no doubt that digital currencies do pose a threat to business of banks.

Australian Senate that Might Actually Understand Bitcoin and its Promise 

The investigation started as a result of Senatorial interest after the Australian government committed to a deeper understanding of Bitcoin and blockchain technology. One of the conclusions of said research, which has been shared by other governments in the world, was that existing financial laws should be more than enough to prosecute those using Bitcoin for illegal activities. Australia has also had brushes with Bitcoin advocacy groups when a Goods and Services tax was enforced on Bitcoin. Recently, the European Union has also joined the United Kingdom in not enforcing a Value Added Tax on Bitcoin.
A Labor Party Senator, Sam Dastyari, was not surprised to hear about the ACCC investigation. He had previously chaired the Senate investigation into digital currencies. At this time, banks such as the National Australia Bank and other similarly sized institutions around the world are delving into blockchain technology. If anything, this is a clear indication that the swift actions of last year, where both domestic and international Bitcoin companies lost their accounts at Australian banks, were anti-competitive in spirit. Even without the emerging facts regarding bank’s research, investment, and involvement with blockchain projects, the majority of domestic companies brought down by Australian bank action were providing services that were in essence competing with banks.

Australia has a large immigrant population from South East Asia that sends remittances back home. Some of the largest Bitcoin remittance companies are based in South East Asia in countries like the Phillipines or India. In Indonesia, Bitcoin is buyable at any of ten thousand plus IndoMaret stores. Australia now seems aptly prepared to benefit from the coming Bitcoin technology boom (bubble as called by some). Once the investigation is over, and banks are 100% clear on what not to do to Bitcoin companies, expect to see more Bitcoin companies return to Australia.

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EU’s Top Court Rules That Bitcoin Exchange Is Tax-Free

(Bloomberg) Bitcoin and other virtual currencies can be exchanged tax free, the
European Union’s top court said in a ruling that puts them on a more
equal footing with traditional cash.
Value added tax — a type of
sales levy — needn’t be applied because the business involves “the
exchange of different means of payment,” the EU Court of Justice in
Luxembourg ruled Thursday. The case was triggered by a dispute in
Sweden, where David Hedqvist set up a service for the exchange of
mainstream money for bitcoin and vice versa.
Bitcoin
currency, introduced in 2008 by a programmer or group of programmers
under the name Satoshi Nakamoto, has no central issuing authority and
uses a public ledger to verify encrypted transactions. It has gained
traction with merchants selling legitimate products but also has been
used to facilitate illegal transactions because money can be transferred
anonymously.
“Transactions
to exchange traditional currencies for units of the bitcoin virtual
currency (and vice versa) constitute the supply of services” under the
bloc’s law “since they consist of the exchange of different means of
payment,” the court ruled. As such they are exempt from value-added
taxes, it said.
To exclude such transactions from the tax
exemptions given to traditional exchanges “would deprive it of part of
its effects,” given that the exemption’s aim is to counter “the
difficulties connected with determining the taxable amount and the
amount of VAT deductible” in cases of taxation of financial
transactions, the court said.

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