{"id":286,"date":"2014-03-09T14:20:00","date_gmt":"2014-03-09T14:20:00","guid":{"rendered":"http:\/\/blog.holytransaction.com\/bitcoin-regulation-update-030714\/"},"modified":"2023-01-10T03:40:33","modified_gmt":"2023-01-10T01:40:33","slug":"bitcoin-regulation-update-030714","status":"publish","type":"post","link":"https:\/\/holytransaction.com\/blog\/2014\/03\/bitcoin-regulation-update-030714.html","title":{"rendered":"Bitcoin Regulation Update – 03\/07\/14"},"content":{"rendered":"
\n
\n
(BitcoinMagazine<\/a>) This
\nweek saw the outing (or not) of Satoshi Nakamoto, Bitcoin<\/a>\u2019s alleged
\ninventor, who is said to have abruptly disappeared from the online
\nforums he was known to frequent in Bitcoin\u2019s early days. Though the man
\nalleged to be Nakamoto, who was living under a different name in the
\nUnited States, denied involvement with Bitcoin, Newsweek, the
\npublication that broke the story, stands behind their work. The early
\nresponse from the online Bitcoin community could best be described as a
\nlow grade form of moral outrage, combined with a dash of horror. What
\nseems to have upset Bitcoiners most is the fact that a media outlet was
\nable to identify and publicly name a person who clearly was not
\ninterested in being identified, using little more than public
\ninformation and basic detective work. To the extent that the majority of
\ncrypto enthusiasts value privacy, if not anonymity, the Satoshi
\nNakamoto affair does not bode well.<\/div>\n<\/div>\n
\n
<\/div>\n<\/div>\n
\n
Canada-based Bitcoin exchange Vault of Satoshi announced via Facebook on Thursday that it would discontinue<\/a>
\nsupport for US customers due to an \u201cincreasingly hostile\u201d regulatory
\nenvironment. The exchange, which connects users with others looking to
\ntrade crypto currencies for fiat currencies, claimed to be facing
\nconsiderable difficulties complying with FinCEN\u2019s anti-money laundering
\nrules, not the least of which was FinCEN\u2019s policy disallowing the filing
\nof paper reports by money service businesses and the seeming
\nincompatibility of the online reporting system with foreign businesses.
\nThe decision to abandon the US market entirely seems to be a fairly
\ndrastic response to US law, which could rightly be described as overly
\ncomplicated. Vault of Satoshi is neither the first nor the only non-US
\nbased company to face US regulatory requirements, so it isn\u2019t clear why
\nit seems to be having unusual difficulty in this area. \u00a0The company\u2019s
\nBitcoin to US dollar volume on Friday stood at 280 coins as of 5:00 PM
\nCST, compared to 314 for Bitcoin to Canadian dollars. Under the new
\npolicy, US traders will be unable to deposit or withdraw cash from the
\nexchange, but will be permitted to trade coins.<\/div>\n<\/div>\n
\n
<\/div>\n<\/div>\n
\n
Yet another exchange, this time Canadian company Flexcoin, informed customers this week that it is insolvent<\/a>
\nas the result of a hack induced theft and would have no choice but to
\ncease operations. The exchange lost an estimated $500,000 worth of coins
\nin its hot wallet, but a spokesman said that customer coins in cold
\nstorage would be returned to their owners. \u00a0Flexcoin referred to its
\nterms of service, reminding its customers that they agreed not to hold
\nFlexcoin liable for theft, while informing everyone else that they were
\nout of luck. The operative verbiage states that \u201cFlexcoin is not
\nresponsible for insuring any bitcoins stored in the Flexcoin system.\u201d
\nWhether this will be sufficient to ward off civil liability remains to
\nbe seen.<\/div>\n<\/div>\n
\n
<\/div>\n<\/div>\n
\n
Her Majesty\u2019s Revenue and Customs service in the United Kingdom has reportedly dropped<\/a>
\na plan to apply value added taxes to mined bitcoins and Bitcoin
\nexchange transactions. However, the treasury maintained in a brief
\ndelivered to British lawmakers that the 20% VAT still applies to goods
\nand services purchased with bitcoins, just the same as it would if those
\nsame goods and services were purchased with Pounds. After a careful
\nreview, HM Treasury was more likely to have discovered the near
\nimpossibility of taxing Bitcoin at the point of exchange or the point of
\ncreation, than to have determined that it falls outside the scope of
\ntransactions subject to the tax. \u00a0Merchants, on the other hand, are
\nalready accustomed to collecting VAT and equipped with the
\ninfrastructure both to report it and to comply with the audit
\nrequirements of the British government. The UK has developed a
\nreputation in the Bitcoin community of late for being comparatively
\nfriendly to crypto currency from a regulatory standpoint and more
\naccessible than US regulators.<\/div>\n<\/div>\n
\n
<\/div>\n<\/div>\n
\n
Vietnam\u2019s Communist government has officially banned<\/a>
\nall Bitcoin transactions. The Vietnamese central bank announced the
\npolicy, citing Bitcoin\u2019s alleged role in promoting money laundering and
\nother criminal activity. The bank did not specify how the ban would be
\nenforced or what the penalties for non-compliance would be. The
\nVietnamese government maintains restrictive capital controls (ostensibly
\nto protect the Dong against speculators), that Bitcoin could be used to
\nsubvert. Few exchanges offer the ability to convert from Bitcoin to the
\nVietnamese Dong. \u00a0However, other currencies, such as the US dollar, are
\nin common use on Vietnam\u2019s streets, especially in urban centers.<\/div>\n<\/div>\n
\n
<\/div>\n<\/div>\n
Japan has announced<\/a>
\nthat it will not attempt to regulate Bitcoin transactions carried out
\nwithin its borders on the grounds that bitcoins are not considered a
\ncurrency. However, Japanese banks will be prohibited from buying or
\nselling bitcoins. The Japanese government also clarified that it intends
\nto treat Bitcoin as a commodity and subject it to the applicable
\ntaxation regime. Japan is the home of Mt. Gox, the collapsed Bitcoin
\nexchange which is currently the subject of a bankruptcy filing in that
\ncountry, along with at least one criminal probe and numerous civil
\nsuits.<\/div>\n<\/div>\n

Open your free digital wallet here<\/a> to store your cryptocurrencies in a safe place.<\/p>\n","protected":false},"excerpt":{"rendered":"

(BitcoinMagazine) This week saw the outing (or not) of Satoshi Nakamoto, Bitcoin\u2019s alleged inventor, who is said to have abruptly disappeared from the online forums he was known to frequent in Bitcoin\u2019s early days. Though the man alleged to be Nakamoto, who was living under a different name in the United States, denied involvement with […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[37,39,76,376,542,649,656],"tags":[730,764,1042,1201,1300,1307],"yoast_head":"\nBitcoin Regulation Update - 03\/07\/14 -<\/title>\n<meta name=\"description\" content=\"Get the latest Bitcoin regulation updates from Bitcoin Magazine with HolyTransaction's blog. 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