European Central Bank official calls for taxation, regulation of Bitcoin

A top European Central Bank official on Jan. 3 called for governments to regulate and tax bitcoin, labeling the cryptocurrency an object of speculation and a tool for money laundering.

Bitcoin should be regulated and even taxed, according to a European Central Bank (ECB) governing council member.

Ewald Nowotny, head of the Oesterreichische Nationalbank, Austria’s central bank, said in an interview with German paper Sueddeutsche Zeitung that anyone who participates in a financial transaction should be clearly identified, on top of paying value-added tax (VAT)

Nowotny’s comments echo those by other ECB officials, who regard the bitcoin’s spectacular surge in value as a bubble, rather than a sign it could be a digital competitor to the euro single currency used by its 19 member nations.

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Nevertheless, the “digital gold” is a concern for central bankers as it can allow money launderers to dodge around increasingly strict rules in the traditional financial system.

“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,” Nowotny said.

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