Norway Says Bitcoins Does Not Qualify As Real Money

Norway Says Bitcoins Does Not Qualify As Real MoneBitcoins and its legality are still evolving. However, the mood of majority of countries and regulatory authorities around the world is to restrict the open and unregulated use of Bitcoins.

For instance, Thailand has already banned Bitcoins. The People’s Bank of China (PBC) has warned financial institutions that they should be “on guard” against the use of Bitcoins because of risks of fraud and money laundering. The France’s central bank has warned against the use of the virtual currency Bitcoin, noting that it is not only highly volatile but also unregulated by authorities. Even India is planning to issue a public advisory against use of Bitcoins in India.

Now Bloomberg has reported that the government of Norway said the virtual currency doesn’t qualify as real money.  “Bitcoins don’t fall under the usual definition of money or currency,” Hans Christian Holte, director general of taxation in Norway, said in an interview. “We’ve done some assessments on what’s the right and sound way to handle this in the tax system.”  Norway will instead treat Bitcoins as an asset and charge a capital gains tax, after Germany in August said it will impose a levy on the virtual currency.

The European Banking Authority (EBA) has also released a warning on the risks of using unregulated digital money that is susceptible to hackers. “Cases have been reported of consumers losing significant amounts of virtual currency with little prospect of having it returned,” the EBA said in a statement on its website. “When using virtual currency for commercial transactions, consumers are not protected by any refund rights under EU law.”