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ECB Calls For Bitcoin Transaction Tax

ECB Calls For Bitcoin Transaction Tax

in Bitcoin & Cryptocurrency published on 3, January 2018

A member of the European Central Bank’s governing board has called for regulation and taxation for bitcoin, in a bid to capitalize on growing speculation in the cryptocurrency markets.

Ewald Nowotny, who is also the governor of the Austrian central bank, said that regulation should remove the blanket of anonymity in bitcoin transactions, as well as applying VAT to cryptocurrency transactions.

He also suggested bitcoin could be used in money laundering and other criminal enterprises, in support of the need for more central regulation.

“It can’t be allowed that we’ve just decided to stop printing 500-euro notes to fight money laundering, that we’ve slapped strict rules on every tiny savings club, and then have to watch people blithely laundering money around the globe with bitcoin.”

The comments come at a time of increasing scrutiny from governments, regulators and central banks across the world.

The government in South Korea announced last week their intention to regulate bitcoin, and to prevent anonymous accounts from withdrawing funds from bitcoin exchanges, in a bid to provide more protection for retail investors.

This follows from similar moves elsewhere, with regulators and governments attempting to gain a great degree of control of the markets in the wake of ongoing bullish markets.

Just days ago, a fellow member of the board of the ECB shared the sentiment, reflecting that “there is a risk of large capital losses which investors should be aware of,” brandishing bitcoin as a bubble.

Both were keen to highlight that bitcoin was not a currency, and could not be used as a method for payment by most investors.

However, they recognized the efficacy of the underlying blockchain technology, and its capacity for technological developments in both financial and other sectors.

The regulate and tax argument has been gaining increasing traction in recent weeks, and the comments from high profile ECB members this week will only add further weight to those calls.

While the calls will not find uniform support, especially amongst investors and industry commentators, it remains to be seen whether these comments will be reflected in the future policy direction of the Eurozone.