Best Bitcoin Card for Finland
They are celebrated as an electronic substitute currency: Bitcoins. The phenomenon also occupies the established central banks. One state has now decided not to accept Bitcoins as a currency – but as a commodity.
In Finland, Bitcoins are now regarded as a raw material
This was decided by the country’s central bank. It did not want to classify the electronic means of payment as a currency.
“If we look at the definition of an official currency as laid down in the law, it is not. Nor is it a payment instrument, because according to the law a payment instrument must have an issuer responsible for its operation,” explained Päivi Heikkinen, head of supervision at the Finnish central bank in Helsinki. “At this stage, it is more like a commodity.
Although the central bank rejects Bitcoins as a legal medium of exchange, the Finns can legally use online money for payments. Capital gains on Bitcoin investments are taxable, but losses are not deductible according to the tax guidelines of the tax authorities. Finns must pay income tax on mined Bitcoins. The first European ATM for Bitcoins was installed last month at a record store in Helsinki railway station.
“Finns can make agreements about the means of exchange they want to use,” Heikkinen explained. “Nobody supervises or regulates it, nobody guarantees it and its value fluctuates widely. It is exclusively their own risk”.
Finland, like other countries before it, is trying to respond to the proliferation of virtual currencies that are not controlled by any central bank or state. While regulators in Europe are warning against the risks of using digital currency as a substitute for real money, they are also warning against the risks of using digital currency as a substitute for real money. But they have a hard time drafting a framework to protect consumers and businesses from potential losses where they have no legal means to recover them.
Of the Scandinavian countries, the Norwegian government has also decided not to classify Bitcoins as a currency, while the Danish Financial Supervisory Authority has stated that it will make recommendations to legislators on how to treat Bitcoins and its competitors.
Bitcoins have met with different reactions around the world
The Chinese central bank has banned its credit institutions from using the virtual currency. The US Internal Revenue Service has not published any guidelines on Bitcoins and has stated that it is working on such a concept and has been monitoring digital currencies and transactions since 2007. Meanwhile, Senate candidate Steve Stockman of Texas accepts Bitcoins as a campaign contribution.
The Bitcoins’ price jumped in November and climbed over $1,000 for the first time as speculators bet on a wider use of digital money. The price on Bitstamp, one of the most active online exchanges where Bitcoins are traded against dollars and other currencies, has since fallen to around $820. A Bitcoin cost about 15 dollars a year ago.
“If it is obviously necessary to regulate the virtual currency and related activities, the legislator should define it,” explained Katri Jokinen, legal advisor to the authority on institutional oversight. “The acquisition of Bitcoins is not a payment transaction that is currently regulated by law. It’s like buying any product.”
Bitcoins was introduced in 2008 by a programmer or group of programmers under the name Satoshi Nakamoto. There are 21 million possible Bitcoins that can be scooped by a peer-to-peer network that can perform complex computing tasks. According to Bitcoincharts.com, about 12.2 million units are currently in circulation.
“The changes in value are completely unregulated and highly susceptible to news, speculation and rumours,” Heikkinen explained. “As the phenomenon increases and begins to trigger side effects, official agencies will have to consider whether to regulate it and how.