As China, Indonesia and India have pretty much outlawed Bitcoin whilst Japan and South Korea embrace it, as the US government is still unsure about what to do whilst its financial markets have accepted the crypto-currency for futures trading, it was, of course, anyone’s guess what the European Union would decide to do about it.
Yesterday evening, after the regular stock market close, the EU commission said it would be clamping down on the popular cryptocurrency, by accepting a new set of rules that target exchange platforms for bitcoins as well as other virtual currencies.
Having seen that Bitcoin is used by people wanting to remain anonymous, by hackers using it to get paid for unlocking computers, and by criminal and terrorist organisations, the EU Commission declared that first and foremost the Bitcoin exchanges would have to identify their users if they wish to continue operating on the European continent.
Furthermore, in order to allow member states to levy taxes on gains, exchanges must identify "persons who can demonstrate a legitimate interest" and allow national investigators more access to information, including national bank account registers.
The Commission is hopeful that this first step will help to curtail criminal organisation, with the Justice Commissioner Vera Jourova stating: "Today's agreement will bring more transparency to improve the prevention of money laundering and to cut off terrorist financing."
Whilst most of the 28 member states accepted the new rules, Britain, Malta, Cyprus, Luxembourg and Ireland stated they need more time to adapt these. Certainly for Britain where the city of London still is the heart of European finance giving up its secrecy of Bitcoin holders would be a hard pill to swallow.
At the time of writing, Bitcoin was trading at a new record high of $18k.