If anyone at the Internal Revenue Service thought that the agency’s quest to force Coinbase to give up its customer records was a battle that would be fought only in the courts, a new development this week may have them questioning that assumption. A May 17 letter from three Congressional Republicans to IRS commissioner John Koskinen indicates that some in Congress may be prepared to flex their oversight muscle to protect taxpayers from the IRS’ unprecedented John Doe Summons.
After months of legal conflict between the IRS, Coinbase, and Berns Weiss LLP partner Jeffrey Berns over the tax agency’s effort to obtain customer records from digital currency exchange Coinbase, a new motion to quash the IRS John Doe summons was filed on May 15,2017. Berns Weiss LLP filed the motion to invalidate the summons on behalf of two Coinbase customers identified within the document as “John Doe 1” and “John Doe 2.”
The Australian government’s 2017-18 Budget was released on Tuesday, and cryptocurrency enthusiasts in the country have at least one provision that should put a smile on their faces. After more than a year of waiting for the government’s promised GST tax relief to materialize, Bitcoin users will no longer need to worry about the existing double tax on the digital currency. The government’s new policy as of July 1, 2017 will see digital currency taxed in the same way that more traditional fiat currencies are treated.
Japanese exchange Coincheck is reportedly set to begin offering its Bitcoin customers interest-paying accounts. The offering will be a first for the country, and will enable Bitcoin holders to deposit their digital currency in fixed deposit accounts that earn interest at one of four different rates ranging from one to five percent.
It has been more than a year since the Australian government committed itself to remedying the nation’s double taxation scheme for cryptocurrencies. The delay in crafting a fix has left some observers wondering whether the issue had been set aside entirely. In a statement released this week, the government has reaffirmed its commitment to addressing the issue.
In the past few months, there have been a flurry of reports indicating that a growing number of central banks around the world are researching the potential benefits of issuing their own digital currencies. Norway’s central bank, Norges Bank, has been giving serious thought to cryptocurrency as well, as evidenced by statements from Norges Deputy Governor Jon Nicolaisen at a recent gathering of the Norwegian Academy of Science and Letters in Oslo.
Add West Virginia to the growing list of U.S. states actively working to ensure that digital currencies like Bitcoin are included in their states’ anti-money-laundering laws. With judges and others questioning whether existing AML legislation can be applied in cases involving cryptocurrencies, state lawmakers have been rushing to modify statutes to meet the challenge. WV lawmakers have now passed a bill that criminalizes the use of digital currency in any money-laundering scheme.
The United Nations Office for Project Services (UNOPS) recently released a request for information (RFI), seeking input on useful applications for blockchain technology. UNOPS is seeking the information in concert with six other UN agencies, as part of a multi-agency effort to leverage the benefits of distributed ledger technology to increase efficiency, accountability, and transparency in peacekeeping, development, and humanitarian aid efforts.
The United States Securities and Exchange Commission (SEC) has decided to review the March decision that rejected the Winklevoss twins’ Bitcoin ETF proposal. The denial came after more than three years of effort by Cameron and Tyler Winklevoss to gain approval for what would have been the United States’ first Bitcoin exchange-traded fund. That decision denied a requested rule change designed to allow the ETF to be included on the Bats BZX Exchange.
Earlier this year, Malta’s Prime Minister, Dr. Joseph Muscat, offered some innovative ideas during his keynote speech at the CEPS Ideas Lab – including a suggestion that Europe should work to become “the Bitcoin continent.” In recent remarks at an Economic and Financial Affairs Committee conference, he vowed that his country would take the lead by becoming one of the first to truly embrace the technology. Malta’s Cabinet has now taken steps toward that goal by approving the initial draft of what is being referred to as a national strategy for blockchain promotion.
Legislators in Florida are considering a bill that would add digital currencies like Bitcoin to the money-laundering statute. The legislation is a response to last year’s dismissal of money-laundering charges in a case that involved a man in Miami beach. The defendant allegedly sold $1,500 in Bitcoin to undercover detectives who had reportedly told him that they intended to purchase stolen credit card numbers. Miami-Dade Circuit Judge Teresa Mary Pooler had thrown out the money-laundering charges after determining that Bitcoin could not be considered “money” as that term was defined in state law.
The government in India announced last week that it had created a special committee to examine involving digital currency technology and propose regulatory policies to address consumer protection, money-laundering, and other concerns. Now, an alliance of digital currency firms – the Digital Asset and Blockchain Foundation of India (DABFI) has announced that it wants to be able to make the industry’s case by meeting directly with the committee.
Belgian Justice Minister Koen Geens is reportedly consulting with experts in an attempt to determine how the government can liquidate Bitcoins it has seized during criminal cases in recent months. Those Bitcoins are currently in the custody of the Central Office for Seizure and Confiscation (COSC) – the government office responsible for managing confiscated assets.
Global blockchain firm Bitfury Group has joined with the Ukrainian government to provide the country with a blockchain platform for eGovernance. CEO Valery Vavilov revealed the partnership during an interview on Wednesday, and additional details about the undertaking were provided in a press release on the company web site on Thursday
In the wake of the Japanese government’s recent recognition of digital currencies, a representative of the Russian government has reportedly indicated that his nation could follow suit next year. According to a Bloomberg report, Russian Deputy Finance Minister Alexey Moiseev affirmed his government’s desire to formally recognize digital currencies like Bitcoin as early as 2018. Russian authorities are currently working with the country’s central bank to create a common approach to cryptocurrencies.
According to the Buffalo News, a federal judge in New York has recommended that money-laundering charges be dropped in a local case, based on his determination that Bitcoin doesn’t qualify as money. Instead, U.S. Magistrate Judge Hugh B. Scott has ruled that Bitcoin more closely resembles a commodity. While he noted that Bitcoin might one day become so acceptable that it could be considered as money, Scott suggested that it currently has more in common with collectibles – like trading cards and other novelty items.
The UK’s Financial Conduct Authority (FCA) released a discussion paper on Monday that addresses blockchain technology’s potential benefits and risks. The release of the paper was timed to coincide with FCA Executive Director of Strategy and Competition Christopher Woolard’s speech today at London’s Innovate Finance Global Summit. The speech was notable for Woolard’s encouragement of the blockchain industry’s ongoing innovation, but also served as a reminder that regulators have a role to play as well.
Kirit Somaiya, the Indian MP who created a bit of a stir last month by suggesting that Bitcoin is a pyramid ponzi scheme, is once again attacking the world’s best-known cryptocurrency. This time, he’s urging the government of India to come out and formally declare that Bitcoin is illegal. Somaiya leveled his latest criticism during the Parliament’s zero hour session on Wednesday.
Arizona Governor Doug Ducey this week signed into law a measure that officially recognizes blockchain signatures and contracts. The bill had been passed by the Senate on March 23, and was signed by the Governor six days later. The bill, HB 2417, had been passed by the Arizona House of Representatives in February, 59-0, and enjoyed near unanimous support in the Senate as well.
A new Japanese law that defines digital currencies as a legal payment method goes into effect on April 1, 2017. That law applies the country’s know-your-customer and anti-money-laundering regulations to Bitcoin and other cryptocurrencies, requires exchanges to meet capital and cybersecurity requirements, and will subject those exchanges to annual audits.