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In Germany, You Can Now Make Private Transactions In Bitcoins

In Germany, You Can Now Make Private Transactions In Bitcoins

The federal government of Germany, one of the most important nations in the financial world, has recognized Bitcoins officially. The financial regulator in the country has added the currency to the national banking code after deciding Bitcoins actually do act as “units of value.”

The digital currency is now recognized as “private money” and thus can be trusted to a degree by bodies like banks. Coindesk.com quotes Stefan Greiner, a German lawyer, as saying the move makes Germany “the first country in the world which has a clear cut set of rules applicable to Bitcoins.” The recognition is important, Greiner thinks, because it lends an official blessing to the most famous crypto-currency, which may allow German banks and Bitcoin exchanges to interact on a more official level. It does require that German Bitcoin companies must comply with local financial regulations, which may seem onerous, but the regulations are designed to protect consumers and other trading partners.

One thing remains unclear, however. While Germany has already ruled that Bitcoins are not subject to capital gains tax–which seems to mean that you could accrue wealth from the currency without owing the government–it’s not clear if transactions in Bitcoins are subject to sales tax.

Thailand is said to have banned Bitcoins because it cannot effectively regulate them, and the U.S. has subpoenaed many of the big national players in the new technology in a seemingly frantic bid to understand the tech and possibly to begin to regulate it.

[Image via Flickr user: Zach Copley]KE