Canada's parliament has passed a bill bringing in comprehensive regulation of bitcoin and other digital currencies.
Congratulations Canada for making a stand and creating policy specifically related to the use of digital currencies like BTC. Most countries around the world cite only one defence for not offering specifc legislation and that is that no currency other than
that issued by the central bank is legal in that country.
The 'illegal by default' taken by many countries is not offering cloear guidelines to businesses or seeking to protect their economies. We can expect more countries to speak up soon on this matter - and rightly so - because BTC is here to stay and the
immense potential of a global currency for improving trade etc need to be explored not ignored.
By setting the groundrules there is a risk of burdening tech start ups with the same kind of regulatory and compliance overhead as banks face, but isn't that the fair approach? Banks bear significant compliance costs and the absence of this amongst startups
gives them an unfair advantage. Encouraging innnovation is of utmost importance but preventing money laundering and jeopardising economic stability are surely of far greater consequecnce.
I completely agree with Sian Bentley on regulating all, not just Bitcoin, digital currencies. The man/woman in the street who would like to use a digital currency, would appreciate a proper regulatory framework that involves transparency, accountability
and security. These arragements will only encourage others to want to use it and as a consequence, lead to Bitcoin being regarded as both safe, useful and potentially cheaper to use than your local bank. It is questionable if there would be a need for a future
international covenant covering virtual currencies. Canada is to be applauded for at least making a constructive start in regulating digital currencies. Other jurisdictions should be encouraged to follow suit. Nobody knows where virtual currencies are headed,
but I have a feeling that they could be an untapped cashless resource that could be of economic and social benefit on a global scale.
CompetitiveNew York City, NY (USA)
© Finextra Research 2015