European Central Bank officials called for a tax on Bitcoin transactions

nBankruptcy comment: The Austrian central bank governor believes that those involved in cryptocurrency trading must be clear identity, pay VAT, while preventing bitcoin for money laundering risk. ECB Executive Board has also pointed out that bitcoin is a bubble that may involve illegal financial activities, so investors need to guard against the risk of capital loss. Both agree that Bitcoin is not a currency and can not be used for payment. However, the technology of distributed ledger possesses certain potential. At present, it has also started to study its role and significance in the existing financial system, but it has not yet reached the technical maturity of the actual deployment.n
nTranslation: Annie_Xun
According to ECB governing council members (ECB), bitcoin must regulate or even tax.n
In an interview with the German newspaper Sueddeutsche Zeitung, Ewald Nowotny, governor of the Austrian central bank, said that anyone who participates in financial transactions must be clear-cut except for VAT.n
Daily Mail reported that the banker worried about its use in money laundering.n
n”In order to combat money laundering, we have just decided to stop printing 500 Euro banknotes, and we also set strict rules for each small savings club and watched people happily laundering money globally with bitcoin, which is not allowed.”n
nA few days ago, Nowotny commented that ECB executive Benoit Coeure told Caixin Global that Bitcoin is a bubble. Like the Austrian colleague, Coeure said one of the major problems with Bitcoin relates to tax avoidance and money laundering.n
Coeure went on to say that bitcoin is largely backed by speculation that “there is a risk of massive capital drain and investors must understand.”n
Both bankers said bitcoin is not a currency, and Coeure said investors can not be considered as a payment method.n
However, he said, the potential of distributed ledger technology as a whole is reflected in retail and wholesale applications, referring to ECB’s recent joint venture with Bank of Japan to study the technology use cases.n
While global central bank agencies are studying how to use the distributed ledger technology to upgrade or replace existing financial systems, the technology is not yet mature enough to make meaningful deployments.n

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