Recapping the week’s biggest Bitcoins stories from around the web.
Virtual currencies could encourage terrorism financing. As Grace Caffyn of CoinDesk writes, a recently released report by the Financial Action Task Force (FATF) entitled “Emerging Terrorist Financing Risks” considers the bitcoin as a potential threat for fueling terrorist financing. FATF notes that “digital currencies have attracted the attention of various criminal groups, including extremist organizations.” FATF also considers that the use of the digital currency will grow further in the short-term, thus increasing the potential risk posed on terrorist financing as well as the need for further research, the report concludes.
Mayor of Barcelona favors a local digital currency. As Samburaj Das of CryptoCoins News reports, Ada Colau, the new mayor of Barcelona is favoring the creation of a local digital currency to boost the local economy and trade and enhance consumer spending within the city limits. Barcelona is the capital city of Catalonia, an autonomous community in Spain that seeks separation from the Spanish state. While the “nation” of Catalonia may soon draw plans for a central bank, the Mayor of Barcelona is already working towards the launch of a local digital currency.
“Blockchain Alliance” against bitcoin-related criminal activity. As Aaron van Wirdum of Bitcoin Magazine writes, the Blockchain Alliance is the newly-established alliance formed under the guidance of the Chamber of Digital Commerce and Coin Center in cooperation with leading bitcoin companies and bitcoin advocates. The Washington, D.C-based nonprofit organization aims to help the law enforcement agencies to combat bitcoin and blockchain-related criminal activity and will be a single point of contact for the FBI, the U.S. Marshals Service, the U.S. Secret Service, Immigration and Customs Enforcement, Homeland Security Investigations and the Commodity Futures Trading Commission. More law enforcement agencies are expected to participate in this closed forum.
Sweden is the first country to become cashless. As Erin Lace of Coin Telegraph writes, according to a study released by the Stockholm-based KTH Royal Institute of Technology, five or six leading banks in Sweden have already stopped using cash. Taking into consideration the Tax Authority guidelines and that people in Sweden are highly digitalized using credit cards and making electronic payments even for small purchases, the bitcoin could become the main currency in Sweden. According to Niklas Arvidsson, a KTH researcher “Cash is still an important means of payment in many countries’ markets, but that no longer applies here in Sweden.”
The European Court of Justice rules against bitcoin taxation. According to Bitcoinist.net, on October 22nd, the principal court of the European Union has ruled that the bitcoin and the digital currencies should be exempted from sales taxes within the E.U. According to the European Court of Justice, the bitcoin transactions should be treated equally with all the transactions involving fiat currencies and it explicitly stated that the bitcoin and other digital currencies can be exchanged tax-free, should be treated as a means of payment, and will be protected under the directive.
Deloitte considers bitcoin regulation should wait. As Nikhil Gupta of NewsBtc writes, a recently released report by Deloitte Center for Regulatory Strategies entitled “Bitcoin At The Crossroads” considers that it is too early to regulate the bitcoin. According to the report, the digital currency has attracted attention too quickly and too thoroughly than other emerging technologies so far, but this doesn’t make it eligible for regulation for three main reasons: 1) the bitcoin is smaller compared to the traditional currency and transaction system; 2) past key innovations took more time to develop and be implemented before being regulated; and 3) bitcoin has a growing potential that may not have been discovered yet.