Bank of Finland Deems Bitcoin a Commodity, Not a Currency
Finland's central bank has deemed bitcoin to be a commodity, following a determination that it does not meet the definition of a currency, or even an electronic payment method. "Considering the definition of an official currency as set out in law, it's not that. It's also not a payment instrument, because the law stipulates that a payment instrument must have an issuer responsible for its operation," said Paeivi Heikkinen, who heads the oversight division at the Bank of Finland. "At this stage it's more comparable to a commodity." The news comes as an increasing number of central banks....
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Bitcoin has been classified as a commodity in Finland after the Scandinavian country's central bank declared that it did not meet the definition of a currency. The Bank of Finland concluded that bitcoin simply doesn't meet the legal conditions required to be considered a form of electronic payment, either. Paeivi Heikkinen, head of oversight at the bank, told Bloomberg that bitcoin was more comparable to a commodity at this point. "Considering the definition of an official currency as set out in law, it's not that. It's also not a payment instrument, because the law stipulates that a....
The Bank of Finland has decided that Bitcoin has failed the currency test. "The Currency Test" as it is referred to by banks and governments around the world in regards to Bitcoin has differing meanings wherever it is cited. Bitcoin's rise to the top is tumultuous indeed. In an interview with Bloomberg's Kati Pohjanpalo, Paeivi Heikkinen, the head of oversight over at the Bank of Finland, stated: "Considering the definition of an official currency as set out in law, it's not that. It's also not a payment instrument, because the law stipulates that a payment instrument must have an issuer....
Since Bitcoin's legal status in not fully clear (even to U. S. regulators), it is very difficult for Bitcoin businesses to stay compliant with local laws. It is unclear whether governments consider Bitcoin to be a "currency" or a "commodity". Depending on how Bitcoin is classified, a business may or may need to seek a money transmitter license. Recent law enforcement action by a Florida prosecutor charging two sellers at LocalBitcoins.com with operating an "unlicensed money service business" might give us an idea as to the U. S. governments stance on this issue... But, things may be....
Finnish regulators have classified bitcoin as a financial service, thus granting it VAT-exempt status. The Finnish Central Board of Taxes (CBT) judged bitcoin to be a financial service in ruling 034/2014, which states that bitcoin purchases qualify as "banking services" under the EU Value Added Tax (VAT) Directive. The ruling was issued after a court classified bitcoin as a payment instrument and sets Finland's approach to the cryptocurrency apart from most European jurisdictions, which generally treat bitcoin as a commodity. However, the nation is not completely alone in taking this....
Finland’s central bank co-organized a seminar on blockchain last week. The Bank of Finland held the event in partnership with the country’s Ministry of Finance. The seminar took place on 24th November, according to the central bank. Attendees included government regulators, local academics and companies based in Finland, drawn from institutions like Aalto University, Lappeenranta University of Technology and the VTT Technical Research Centre of Finland. Representatives from firms like Microsoft and Finnish energy firm Fortum were also in attendance. In statements, central bank....