In August, international organizations were especially active when it came to furthering exploration of Bitcoin regulation. Many countries particularly placed a focus on the role regulation could play in thwarting the use of digital currency to fund and support illegal activities.
According to the minutes from the G7’s June meeting in Germany, the group is supportive of the regulation of digital currency in large part due to concerns that such currencies may be used to finance terrorist organizations. The statement reads in part:
“We will take further actions to ensure greater transparency of all financial flows, including through an appropriate regulation of virtual currencies and other new payment methods.”
The G7 is comprised of some of the world’s largest economies including Canada, France, Germany, Italy, Japan, the UK and the US.
After The European Securities and Markets Authority put out a request for information on virtual currencies, Italian bank Intesa Sanpaolo responded with a letter highlighting the bank’s own investigations and ideas about use cases and possibilities for Bitcoin and blockchain technology. The letter also encouraged the Authority to resist the terminology “virtual currency”.
A Tokyo District court ruled that Bitcoin isn’t “subject to ownership” in a case that involved a plaintiff seeking damages for losses in the Mt Gox exchange failure, according to reports from The Japan Times. The judge, Masumi Kurachi, said that due to the fact that bitcoins are intangible and rely heavily on a third party, they cannot be successfully covered under current regulations.
After receiving a question about how Spanish tax laws would apply to losses resulting from the failure of a Bitcoin exchange, scam or insolvency, Spain’s Dirección General de Tributos (DGT) clarified that such events were covered by Personal Income Tax Law and could be considered a capital loss.
In hopes of thwarting money laundering and other illegal activities, Nigeria’s Central Bank is calling for the regulation of Bitcoin and other digital currencies and will be exploring the currencies further.
During a speech, Shri R Gandhi, the deputy governor for the Reserve Bank of India spoke about virtual currencies and their ability to advance innovation as well as negative consequences due to their potential for illegal activity use.
“Digital currencies and crowdfunding have the potential to support criminal, anti-social activities like money laundering, terrorist funding and tax evasion. While we do not have any reported instances of crowdfunding in this respect, cryptocurrencies have been widely suspected to finance criminal activities. We have to be carefully and critically watching these developments.”
The Commonwealth’s Virtual Currencies Working Group has urged commonwealth nationals to consider regulating digital currencies in hopes of promoting both innovation and safe, legal uses according to reports from CoinDesk:
“Member states should consider the applicability of their existing legal frameworks to virtual currencies and where appropriate they should consider adapting them or enacting new legislation to regulate virtual currencies.”
They also asked commonwealths to educate all groups who may encounter the currencies about the uses and operation of such technology.
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Every month, itBit scours the globe to bring you the most important digital currency regulation news and updates. For past articles, check out the full Global Digital Currency Regulatory Roundup archive.