Hollands finance ministry discusses bitcoin ban

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Back to Index of Legal Reports. This report surveys forty foreign jurisdictions and the European Union, reporting on any regulations or statements from central banks or government offices on the handling of bitcoins as well as any significant use of bitcoins in business transactions.

Of those countries surveyed, only a very few, notably China and Brazil, have specific regulations applicable to bitcoin use. Overall, the findings of this report reveal that the debate over how to deal with this new virtual currency is still in its infancy. However, journalists have reportedly obtained documents indicating that Alderney is trying to take the lead and become the central hub for the bitcoin, by minting and issuing physical bitcoins and creating an international center with a bitcoin storage vault service that complies with anti-money laundering rules.

Under the National Constitution of Argentina [3] the only authority capable of issuing legal currency is the Central Bank. Therefore, they may be considered hollands finance ministry discusses bitcoin ban but not legal currency, since they are not a mandatory means of cancelling debts or obligations.

Although bitcoins are not specifically regulated, they are increasingly being used in Argentina, a country that has strict control over foreign currencies. According to the guidance paper and draft rulings, Bitcoin transactions will be treated "like barter transactions with similar taxation consequences. Additional information on this topic is available. The Belgian Finance Minister, in response to a question by a Belgian senator, stated in July that while the Bitcoin system seems to be somewhat problematic as a potential tool for money laundering and other illegal activities, such problems should not be overstated.

He also stated that, based on studies from the Belgian central bank Banque nationale de Hollands finance ministry discusses bitcoin ban and the European Central Bank, the bitcoin does not present any significant risks to price stability, to the financial system in general, or to its individual users.

Finally, in this same statement, the Minister of Finance indicated that government intervention with regard to the Bitcoin system does not appear necessary at the present time. On October 9,Brazil enacted Law No.

Article 11 determines that the penalties provided for in the legislation applicable to financial institutions applies to the infractions set forth in Law No.

Canada does not have a specific law or regulation that regulates bitcoins. Nevertheless, these payment systems should be designed and operated to meet the needs of Canadians which would include convenience and ease of use, price, reliability, safety, and effective redress mechanisms.

On February 11,the Canadian Finance Minister unveiled the Federal Budget forwhich included a brief mention of Canadian government plans to introduce anti-money laundering and anti-terrorist financing regulations for virtual currencies such as Bitcoin.

The new law will treat virtual currencies, including Bitcoin, as "money service businesses" for the purposes of the anti-money laundering law. According to news reports, there are no merchants that accept bitcoins in Chile as of yet. Buying virtual currencies in Chile is still very cumbersome. Interest in acquiring bitcoins is slowly growing. However, because there is no regulation on the use of bitcoins, transactions are informal in nature and mainly conducted among friends.

On December 3,the central bank of China and four other central government ministries and commissions jointly issued the Notice on Precautions Against the Risks of Bitcoins.

Banks and payment institutions in China are prohibited from dealing in bitcoins. The Notice further hollands finance ministry discusses bitcoin ban strengthening the oversight of Internet websites providing bitcoin registration, trading, and other services.

It also warned about the risks of using the Bitcoin system for money laundering. On December 6,the Croatian National Bank CNB reportedly conducted a discussion on the circulation of digital currencies and concluded that the bitcoin is not illegal in Croatia: According to the same report. The use of bitcoins is hollands finance ministry discusses bitcoin ban regulated in Cyprus. However, the Danish Tax Authority has not published any comment as to whether Bitcoin earnings should be taxed.

On March 18,the Danish Central Bank issued a statement declaring that Bitcoin is not a currency. According to the statement, "Bitcoin does not have any real trading value compared to gold and silver, and thus is more similar to glass beads.

The Danish Central Bank went on to point out that Bitcoins are not protected by any national laws or hollands finance ministry discusses bitcoin ban, such as a deposit guarantee. On April 1the Tax Authority published a binding reply in which it declared that an invoice cannot be issued in Bitcoins, but must instead be issued in Danish Kroner or another recognized currency. The Authority went on to state that any losses in Bitcoins cannot be deducted as a cost of doing business.

In Estonia, the use of bitcoins is not regulated or otherwise hollands finance ministry discusses bitcoin ban by the government. On December 19,the Estonian business information Web portal Dv. Nymmel said that according to Bank of Estonia estimates, the bitcoin does not create any threat to financial or price stability because of its limited virtual area of circulation. In MarchEstonian Tax Authority defined the official government position that Bitcoin is an alternative means of payment and income derived from Bitcoin transactions constitutes capital gain subject to taxation.

The European Union EU has passed no specific legislation relative to the status of the bitcoin as a currency. In Octoberthe European Central Bank issued a report on virtual currency schemes that discusses the Bitcoin system and briefly analyzes its legal status under existing EU legislation.

On December 13,the European Banking Authority EBAthe regulatory agency of the EU responsible for advising EU institutions on banking, e-money regulation, and payments, issued a warning on the dangers associated with transactions, such as buying, holding, or trading virtual currencies.

The EBA pointed out that since the bitcoin is not regulated, consumers are not protected and are at risk of losing their hollands finance ministry discusses bitcoin ban and that consumers may still be liable for taxes when using virtual currencies.

The Finish Tax Authority, Vero Skatt, has issued instructions for the taxation of virtual currencies, including the bitcoin. When transferred to another currency, the rules on taxation of capital gains apply.

When the currency is used as a form of payment for goods and services, it is treated as a trade, and the increase in value that the currency might have gained after it was obtained is taxable. A court decision that is mentioned in the Banque de France report found that a company that acted as an exchange for bitcoins should be considered a payment service provider, subject to oversight from the French Prudential Supervisory Authority.

Accordingly, bitcoins are units that are not expressed in the form of legal tender. Instead, they are units of value that have the function of private means of payment within private trading exchanges, or they are substitute currencies that are used as a means of payment in multilateral trading transactions on the basis of legal agreements of private law.

However, licensing could become necessary under various circumstances, such as the creation or maintenance of a market in bitcoins. The tax treatment of bitcoins has been discussed in some statements by the Federal Ministry of Finance. Among the opinions voiced by the Ministry is a statement on the possibility of value-added tax liability for bitcoin transfers, the lack of income tax effects for the underlying transaction when bitcoins are used as a means of payment, and the lack of long-term capital gains liability for bitcoins that are held for longer than one year.

No specific legislation on bitcoins exists in Greece, nor has the National Bank of Greece issued any statement on bitcoins. A private company has listed a few businesses that accept bitcoins as a form of payment, however. However, our existing laws such as the Organised and Serious Crimes Ordinance provide sanctions against unlawful acts involving bitcoins, such as fraud or money laundering. On March 19, the Central Bank of Iceland issued a statement explaining the legal status of digital coins in Iceland.

The coins are not a recognized and protected currency, and purchasing them may violate the Icelandic Foreign Exchange Act, which specifies that Icelandic currency cannot leave the country. Additional information on the topic is available. There appears to be no explicit legal framework that regulates, restricts, or bans hollands finance ministry discusses bitcoin ban in India.

It is not regulated by the central bank so hollands finance ministry discusses bitcoin ban are risks. On February 6,Bank Indonesia issued a statement on bitcoin and other virtual currencies. The Central Bank of Ireland has not hollands finance ministry discusses bitcoin ban a statement on its website regarding bitcoins. The Revenue Commissioners in Hollands finance ministry discusses bitcoin ban are monitoring the development of the bitcoin and considering its implications for possible taxation, with the most likely areas of taxation being in the taxation of any gains, as well as value-added tax, which is a charge on goods and services.

According to media reports, officials from the Ministry of Justice and Bank of Israel have been conducting discussions on the implications of using bitcoins, particularly in illicit hollands finance ministry discusses bitcoin ban. An incident of an alleged attempted extortion involving a request for payment in bitcoins was reported on December 19, At least three Israeli banks have received emails from an unknown individual threatening to release the personal details of millions of their customers unless the payment was made.

On October 29,the European Central Bank published a report titled Virtual Currency Schemes[75] which studies relevant hollands finance ministry discusses bitcoin ban and legal aspects of the Bitcoin system. A European Directive of regulates the use of electronic currencies including the bitcoin with the aim of harmonizing payment methods, increasing competition, and facilitating market access.

The Decree allows the use of electronic currencies in accordance with the EU Directive at the level of the European Central Bank, and by the central banks of European Members, the Italian public administration at the regional and local government levels, and the Italian postal system. However, the use of electronic currency is restricted to banks and electronic money institutions—that is, private legal entities duly authorized and registered by the Central Bank of Italy.

Aside from these developments, Italy does not regulate bitcoin use by private individuals, and currently the implementation of initiatives concerning the use of electronic currencies lies with the EU.

There are at present no laws in Japan regulating the use of bitcoins. The amendment to the Payment Services Act included virtual currency exchanges regulation.

Virtual currency exchanges operating in Japan will be required to register with the Financial Services Agency. The amendment will be effective by early June in Bank Negara Malaysia officials apparently met with local bitcoin proponents in November to learn more about the currency. The Central Bank does not regulate the operations of Bitcoin. The public is therefore advised to be cautious of hollands finance ministry discusses bitcoin ban risks associated with the usage of such digital currency.

Malta currently does not have any regulations specifically pertaining to bitcoins, nor does there appear to be any official government statement on the recognition or policy towards the bitcoin. In Octobera Maltese company launched the first bitcoin hedge fund. Virtual currencies such as bitcoins currently do not fall within the scope of the Act on Financial Supervision Wet op het financieel toezicht of the Netherlands, as the Dutch Minister of Finance, Jeroen Dijsselbloem, recently emphasized.

He emphasized that currently, despite the watchful eye of government authorities on the future development of virtual currencies, in principle the consumer is solely responsible for their use. The Dutch Central Bank De Nederlandsche Bank, DNB recently called attention to the risks posed by the purchase of virtual currencies, including bitcoins and litecoins, [91] and warned consumers to be wary.

Nevertheless, Dutch regulators have not imposed licensing restrictions on virtual currency businesses. On May 14,a district court in a decision in a civil suit involving an uncompleted Bitcoin transaction between two parties, ruled that Bitcoin, like hollands finance ministry discusses bitcoin ban, is a medium of exchange that is hollands finance ministry discusses bitcoin ban acceptable form of payment in the country but that cannot be defined as legal tender, common money, or electronic money.

However, the Reserve Bank has no direct power over any form of alternative payments medium. Who knows at this point? There is still a lot for the world to learn on this issue. It appears that Nicaragua has not yet promulgated any legislation regulating bitcoins, nor has the Central Bank of Nicaragua issued any hollands finance ministry discusses bitcoin ban or guidelines on the subject. However, news reports indicate that bitcoins are being used in the country.

Simon is reportedly interested in promoting the use of bitcoins in Nicaragua and advanced some ideas related to their use. The Norwegian Tax Authority has issued a principle statement that bitcoins will be treated as capital property, at least for tax-related purposes. Capital property legislation allows for deductions for losses and taxes on winnings.

Although travel currencies are exempted from the capital gains tax, bitcoins are not as the bitcoin and other virtual currencies are not recognized as travel currencies. The use of the bitcoin in Poland is not regulated by a legal act at present. On December 21,the Russian website Coinspot. Wozniak was more certain about the taxation of bitcoin transactions. He said that all types of income must be taxed under Polish law, and the law makes no distinction among the types of payments used to conduct transactions, including bitcoin payments.

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The legal status of bitcoin varies substantially from country to country and is still undefined or changing in many of them. While some countries have explicitly allowed its use and trade, others have banned or restricted it. Likewise, various government agencies, departments, and courts have classified bitcoins differently. While this article provides the legal status of bitcoin, regulations and bans that apply to this cryptocurrency likely extend to similar systems as well.

According to the European Central Bank , traditional financial sector regulation is not applicable to bitcoin because it does not involve traditional financial actors. The European Central Bank classifies bitcoin as a convertible decentralized virtual currency.

In the European Parliament's proposal to set up a taskforce to monitor virtual currencies to combat money laundering and terrorism, passed by votes to 51, with 11 abstentions, has been sent to the European Commission for consideration. As of [update] bitcoin was legal in Algeria, but per the Huffington Post , "Algeria is going to ban bitcoin in the new Finance law of article of the law " [13]. Virtual currency is that used by internet users via the web. It is characterized by the absence of physical support such as coins, notes, payments by cheque or credit card.

Any breach of this provision is punishable in accordance with the laws and regulations in force. The following day, the monetary authorities also reacted in a statement issued jointly by the Ministry of Economy and Finance, Bank Al-Maghrib and the Moroccan Capital Market Authority AMMC , warning against risks associated with bitcoin, which may be used "for illicit or criminal purposes, including money laundering and terrorist financing".

On 19 December , Abdellatif Jouahri, governor of Bank Al-Maghrib, said at a press conference held in Rabat during the last quarterly meeting of the Bank Al-Maghrib's Board of that bitcoin is not a currency but a "financial asset", He also warned of its dangers and called for a framework to be put in place for consumer protection. As of 17 January , The Central Bank of Nigeria CBN has passed a circular to inform all Nigerian banks that bank transactions in bitcoin and other virtual currencies have been banned in Nigeria.

It noted that "Central bank cannot control or regulate bitcoin. Central bank cannot control or regulate blockchain. Just the same way no one is going to control or regulate the Internet. In September the Bank of Namibia issued a position paper on Virtual Currencies entitled [23] wherein it declared cryptocurrency exchanges are not allowed and cryptocurrency cannot be accepted as payment for goods and services.

The Reserve Bank Of Zimbabwe is sceptical about bitcoin and has not officially permitted its use. Bitcoin would seem to be classified pursuant to the current provisions of the PPSA simply as an " intangible ". As of April the Bank of Montreal BMO announced that it would ban its credit and debit card customers from participating in cryptocurrency purchases with their cards [31].

Treasury classified bitcoin as a convertible decentralized virtual currency in Per IRS, bitcoin is taxed as a property. In September , a federal judge ruled that "Bitcoins are funds within the plain meaning of that term". Bitcoin is legal in Mexico as of It is to be regulated as a virtual asset by the FinTech Law.

News reports indicate that bitcoins are being used in the country. The Costa Rican Central Bank announced that bitcoin and cryptocurrencies are not consider currencies, and are not backed by the government nor laws. However, they are not illegal. There are a few merchants who do accept bitcoins in the country. The Bank of Jamaica BoJ , the national Central Bank, has publicly declared that it must create opportunities for the exploitation of technologies including cryptocurrencies.

Accordingly, in the BoJ will be embarking on a campaign to build awareness of cryptocurrencies as part of increasing general financial literacy and understanding of cryptocurrencies.

Indications are that early BoJ signals point to their general framework on "electronic retail payment service systems" possibly being brought to bear on initial cryptocurrencies considerations. Bitcoins may be considered money, but not legal currency. A bitcoin may be considered either a good or a thing under the Argentina's Civil Code, and transactions with bitcoins may be governed by the rules for the sale of goods under the Civil Code.

The Central Bank of Bolivia issued a resolution banning bitcoin and any other currency not regulated by a country or economic zone in Not regulated, according to a statement by the Central Bank of Brazil concerning cryptocurrencies, but is discouraged because of operational risks. There is no regulation on the use of bitcoins.

A 26 March by Superintendencia Financiera de Colombia states that the use of bitcoin is not regulated. The Ecuadorian government has issued a ban on bitcoin and other digital currencies.

Ecuador's new project would be controlled by the government and tied directly to the local currency—the dollar. Users will be able to pay for select services and send money between individuals. This was slated to begin in mid-February Bitcoin is considered a commodity, [47] not a security or currency under the laws of the Kyrgyz Republic and may be legally mined, bought, sold and traded on a local commodity exchange.

The use of bitcoins is not regulated in Cyprus. As a DMCC licensed company, Regal Assets DMCC operates in a secure regulated trading environment and offers a service to global investors to the highest standards of international compliance.

As of , the Israel Tax Authorities issued a statement saying that bitcoin and other cryptocurrencies would not fall under the legal definition of currency, and neither of that of a financial security, but of a taxable asset.

Bitcoin is not banned by any governmental party in Saudi Arabia. The government of Jordan has issued a warning discouraging the use of bitcoin and other similar systems.

The Central Bank of Jordan prohibits banks, currency exchanges, financial companies, and payment service companies from dealing in bitcoins or other digital currencies. The government of Lebanon has issued a warning discouraging the use of bitcoin and other similar systems. Bitcoin is not regulated as it is not considered to be electronic money according to the law. Bitcoin is neither recognized nor regulated in Iran. Government officials, however, discourage investing in cryptocurrencies until after the regulations are made.

In September , Bangladesh Bank said that "anybody caught using the virtual currency could be jailed under the country's strict anti-money laundering laws". Finance minister Arun Jaitley, in his budget speech on 1 February , stated that the government will do everything to discontinue the use of bitcoin and other virtual currencies in India for criminal uses.

He reiterated that India does not recognise them as legal tender and will instead encourage blockchain technology in payment systems. On 13 August Nepal Rastra Bank declared bitcoin as illegal. This news was followed right after India's restriction of converting bitcoin and cryptocurrencies into fiat currency.

For organizations and institutions it is banned by State Bank of Pakistan. Bank will not get involved if there is any dispute. They will not facilitate any transaction for it. For individuals, it is neither legal nor illegal and they can hold cryptocurrencies at their own risk.

National Assembly of Pakistan can pass law to declare bitcoin legal or illegal in Pakistan, but there is no such news from National Assembly yet. The bank has issued an official notice on its website and has also posted the news on its official Twitter account.

While private parties can hold and trade bitcoins in China, regulation prohibits financial firms like banks from doing the same. On 5 December , People's Bank of China PBOC made its first step in regulating bitcoin by prohibiting financial institutions from handling bitcoin transactions. On 16 December it was speculated that the PBOC had issued a new ban on third-party payment processors from doing business with bitcoin exchanges, [67] however a statement from BTC China suggests this isn't accurate, and rather payment processors had voluntarily withdrawn their services.

On 1 April PBOC ordered commercial banks and payment companies to close bitcoin trading accounts in two weeks. On 9 February , multiple bitcoin exchanges in China delayed or paused bitcoin withdraw service, with or without announcement. Some of the announcements, [71] [72] [73] [74] if not all, claim that regulation activities have been or are to be taken. News resources [75] also show that, although such activities were carried out by PBOC, they were not done via legal approaches, but by "appointment" instead.

None of the exchanges presented or have claimed to receive any lawful paperwork. The crackdown on bitcoin and other virtual currency traders was accompanied by Chinese media touting the dangers of virtual currency as a tool for criminal activities. On 8 January , the Secretary for Financial Services and the Treasury addressed bitcoin in the Legislative Council stating that "Hong Kong at present has no legislation directly regulating bitcoins and other virtual currencies of [a] similar kind.

However, our existing laws such as the Organised and Serious Crimes Ordinance provide sanctions against unlawful acts involving bitcoins, such as fraud or money laundering. He also decided that bitcoins will not be regulated by HKMA. However, the authority will be closely watching the usage of bitcoins locally and its development overseas. Japan officially recognizes bitcoin and digital currencies as a "means of payment that is not a legal currency" see Article of Japans's Payment Services Act PSA 25 May On 7 March , the Japanese government, in response to a series of questions asked in the National Diet, made a cabinet decision on the legal treatment of bitcoins in the form of answers to the questions.

The decision also acknowledges that there are no laws to unconditionally prohibit individuals or legal entities from receiving bitcoins in exchange for goods or services. Taxes may be applicable to bitcoins. According to Nikkei Asian Review , in February , "Japanese financial regulators have proposed handling virtual currencies as methods of payment equivalent to conventional currencies". The city of Hirosaki is officially accepting bitcoin donations with the goal of attracting international tourists and financing local projects.

While not illegal in the country, Korean authorities will prosecute illegal activity involving bitcoin [88] and have indicted at least one individual for purchasing drugs with bitcoin. There are no laws in South Korea regulating the use of bitcoin at present.

South Korea On 12 December , the president of the Bank of Korea recommended at a press conference that bitcoin be regulated in the future. Bitcoin ATMs are banned here [7]: Taiwan but bitcoins can be purchased at over convenience store kiosks. Regulators have warned the public that bitcoin does not have legal protection, "as the currency is not issued by any monetary authority and is therefore not entitled to legal claims or guarantee of conversion".

While bitcoin is not illegal in Taiwan, financial institutions have been warned by regulators that necessary regulatory actions may be taken if they use it. On 6 December , Perng Fai-nan said that bitcoin is only used in certain communities. Besides, he also opined that the value of bitcoin is a bubble and is highly volatile.

Therefore, he advised the public against the speculation of bitcoins to prevent making a loss during the process. The central bank is closely watching the development of bitcoin and plan to impose regulations in the future. It is stated that bitcoins remains highly volatile, highly speculative, and is not entitled to legal claims or guarantee of conversion.

However, despite this, three of the four major convenience store chains in Taiwan make available purchases of bitcoin through their kiosk systems, [97] and the largest chain now allows bitcoin to be used for purchases of goods.

There are no regulations related to the use of bitcoin and other cryptocurrencies in Cambodia. The National Bank has stated that cryptocurrencies are illegal in Cambodia and has instructed commercial banks in the country not to accept bitcoin and other cryptocurrencies in financial transactions.