Bitcoin has officially been recognized as a means of private money by Germany, meaning it can be used as legal tender and may be taxed by the government. This makes Germany the first country in the world to take a clear and decisive stance on using Bitcoin as money.
The consequences of the above will be that vendors involved in Bitcoin transactions can be subject to taxes. The good news is that those individuals who use Bitcoin for personal use will not be bound by taxes. In other words, the use of the online currency will be completely tax-free, according to German newspaper Die Welt.
According to Die Wet, the government in Berlin states that the virtual tender is Private Money and Currency Unit, which makes Bitcoin much more paramount.
This is so, because to be recognized as private money by the largest economy in Europe greatly enhances the status of Bitcoin. Moreover, this will make it harder for the U.S. to ban the virtual currency in the future.
Since 2009, Bitcoin has been a widely used and popular form of online payment. One of the reasons for this is that the masses have become less trustworthy of traditional currencies since the financial crisis of 2008. The problem is there has been resistance to the online currency by various countries, especially the U.S. and Thailand.
A key German Member of Parliament Frank Schaeffler stated that for the first time in history the German government has acknowledged Bitcoin as private money.
The above comes just after the first Bitcoin trading platform in Europe was established in Germany with the cooperation of the Financial Supervisory Authority. Now Bitcoins are traded on the platform of Bitcoin Deutschland GmbH.
There was more good news recently: In early August an American federal judge in Texas ruled that Bitcoin is a legitimate currency. This came following a Ponzi shceme involving a scam of clients of more than $4.5 million by Trendon Shavers. This was conducted via his online hedge fund. The court threw out his claim that Bitcoin is not legitimate money and no regulation is required by the U.S. government.
This may have played a role in the German decision discussed in this article. What can’t be denied is that the court decision in the U.S. brought Bitcoin a step closer to being recognized as an official currency. On the downside, it opened the doors to regulation by central governments who object to the virtual currency.
What both the U.S. and German decisions show is that Bitcoin is only getting bigger. Therefore, individuals and entrepreneurs can now benefit from the spread and acceptance of the crypto currency.
To contact the reporter of this story: Jonathan Millet at firstname.lastname@example.org