Big governments around the world have begun to express their uncertainty regarding the legitimacy of Bitcoin. The popular crypto-currency has been gaining traction since 2009 and has gotten positive reception from some governments who have accepted it as a legal payment method. Others, however, have some reservations about legally accepting virtual currencies.
One issue of concern for some governments is the establishment of a proper regulatory system for Bitcoin transactions. Virtual currency transactions will be difficult for the government to monitor, in terms of taxation and promotion of global funds flow. It is imperative for any government to have the ability to regulate all forms of currency exchange to prevent market manipulation and ensure financial security.
Chinese Government Ban
Earlier this month, the Chinese government imposed a ban on crypto-currency trading and sales, claiming that Initial Coin Offerings (ICOs) have resulted in some unsettlement in the nation’s economic activities. This ban has led to a 10% drop in the value of Bitcoin, and the government is yet to establish the official standing of crypto-currency. The Blockchain Global Summit, scheduled to hold in China on the 10th September 2017, was even moved to Hong-Kong following China’s new crypto-currency regulations.
China is not the only government taking strict measures against virtual currency. The United States Securities and Exchange Commission declared ICOs as investments which should be subject to existing stock market rules. The Russian government has an ongoing investigation on Bitcoin, since the indictment of Alexander Vinnik for laundering over $4 billion in Bitcoin. Although crypto-currency mining is legal in Venezuela, the government is currently on the hunt for Bitcoin miners claiming that they capitalize on the resource without proper documentation.
Cryptocurrency Lovers are still unshaken
Crypto-currency enthusiasts all over the world have taken to social media to air their opinions on the subject. While most remain confident and believe that these stringent measures are being implemented because governments view crypto-currency as a threat to their capitalist agenda, others are cashing out their investments for fear of financial loss.