UK's supervision policy on virtual currency

1. Reason: with the rapid development of information technology, real money is far from meeting people's demand for capital flow. If there are enough people to recognize the value of a virtual currency, it may become a substitute unit of material exchange, and the existence of virtual currency will inevitably cause another upsurge in the financial sector
in view of the possible risks of virtual currency, many international organizations and central banks have responded publicly to the supervision of virtual currency system. These responses can be roughly divided into four categories: warning and risk warning, supervision and registration permission, legislative norms, and explicit prohibition
(1) warning and risk warning
some central banks and regulators have issued risk warnings against the special currency and virtual currency system. The federal financial regulatory authority of Germany, the Bank of France, the central banks of the Netherlands and Belgium have issued public warnings against the possible money laundering and terrorist financing caused by the use of bitcoin. In the report released at the end of 2013, the European Banking authority (EBA) warned consumers of many risks of virtual currency, such as exchange loss, e-wallet theft, unprotected payment, price fluctuation and so on. Although Spain did not have a similar risk warning, it issued a timely information announcement related to virtual currency
(2) supervision and registration license
generally speaking, international organizations believe that the supervision of virtual currency should find a balance between risk prevention and innovation promotion. Since 2012, Sweden has required transactions related to virtual currency to be registered with financial regulators. Other countries pay attention to qualification supervision, so as to make it indirectly meet the requirements of prudential supervision. In other countries, the regulation mainly focuses on the business model of virtual currency transaction. The financial prudential regulatory authority of France regards the provision of bitcoin circulation and trading services and the act of earning funds in the process as a payment service and requires the authorization of the government. In addition, some countries focus on the intermediary institutions related to virtual currency. The German federal financial regulatory agency and Danish regulators believe that the provision of intermediary services for virtual currency needs to be authorized< (3) legislative norms
at present, some countries have proposed legislation to regulate virtual currency transactions. Canada plans to legislate to allow the government to supervise the transaction of bitcoin, and to include the transaction of more than US $10000 into the scope of suspicious supervision. The United States hopes to adjust the relevant legal structure should be compared with the development of the special currency. In order to make the Bank Secrecy Act (BSA) applicable in the context of network, the financial crime enforcement network (FinCEN) of the U.S. Department of the Treasury issued the explanatory guidance on the behavior and subject definition of private generation, holding, distribution, trading, acceptance and transmission of virtual currency in 2013. The European central bank stressed that it should strengthen international cooperation under the existing legal framework, and regulate virtual currency from the European and global level under the existing legal framework. More countries believe that bitcoin is not a currency in circulation, has no legal status, and does not meet the definition of financial instruments, such as Finland, Sweden, Malaysia and Indonesia
(4) it is forbidden
in some countries, bitcoin related transactions are prohibited. In December 2013, the people's Bank of China banned financial institutions from trading in bitcoin, which was subsequently extended to payment service providers. The central banks of Thailand and Indonesia share the same attitude. The circulation of anonymous internet currency (including bitcoin) is prohibited by the Russian judicial inspection department as a substitute for currency. The Central Bank of Russia has earlier included the provision of bitcoin services in the scope of suspicious transaction monitoring. The U.S. Securities and Exchange Commission (SEC) has banned the issue of unregistered shares in exchange for bitcoin, and unregistered online securities trading activities in virtual currency.

2. The difference lies in the fact that some foreign countries are particularly strict in this kind of supervision, while others are particularly loose. In terms of domestic supervision, it is relatively perfect.

3. Now the virtual RMB has also been issued, and the state's policy on virtual currency must strengthen supervision. In this case, we can agree.

4.

At the G20 meeting, different countries held different views on digital currency, some strongly resisted it, and some actively supervised it. Now let's take a look at the attitudes of the G20 countries towards digital currency

In a statement, the Canadian Securities Regulatory Agency (CSA) said that considering the whole process of ICO issuance, many ICO tokens meet the definition of securities and require them to comply with the securities law. In addition, the CSA noted that ICOS may also be derivatives, subject to derivatives laws passed by Canadian securities regulators, including trade reporting rules. Regulators said they welcome companies that are about to conct ICO to enter the "regulatory sandbox" to test new financial procts in a limited environment

India

the securities and Exchange Commission of India is planning guidelines for the regulation of the bitcoin market in India. In addition, the securities and Exchange Commission of India set up a financial regulatory commission and held meetings with Reserve Bank of India (RBI) officials. The SEC also plans to regulate whether bitcoin derivatives and other cryptocurrencies are used to raise funds illegally

5. Australia
in October 2013, bitcoin Bank of Australia was attacked by hackers, with a loss value of more than US $1 million. This incident has aroused the concern of bitcoin security in Australia. The Reserve Bank of Australia and the Australian tax office have said they want a virtual currency tax like a business transfer tax
Bangladesh
the Central Bank of Bangladesh banned the use of virtual currency in September 2014. Using bitcoin will be punished by law
Brazil
Brazil is one of the few countries in the world that has enacted laws related to electronic currency payment systems. Brazil has not banned bitcoin
Bolivia
for regulatory reasons, the Central Bank of Bolivia (BCB) has banned the use of bitcoin. BCB believes cryptocurrency will help business entities evade taxes
Canada
bitcoin is not considered legal, that is, bitcoin is not recognized by Canadian law. Canada's tax authorities plan to implement the same tax plan as barter trade and speculative trading for the bitcoin
China
China is one of the few countries in the world that ban bitcoin completely and prohibit financial institutions and banks from dealing with bitcoin transactions. In December 2013, the people's Bank of China issued a notice calling bitcoin & quot; Virtual goods;, And prevent it from becoming money
trading has been suspended
Ecuador has banned bitcoin, but it has chosen to set up a new state-owned electronic currency and monetary system, and the currency will be protected by the assets of the Central Bank of Ecuador
EU
at present, the EU still has different views on the classification of bitcoin. In October 2012, the European Central Bank's report on virtual currency concerns the legality of bitcoin under the EU legal framework. The European Banking Regulatory Authority issued a bitcoin risk warning, saying that the use of bitcoin has not been restricted at present
Finland
Finland has relevant regulations for the use of virtual currencies such as bitcoin. The relevant regulations are issued by the Finnish tax authority Vero skatt. Any gains arising from bitcoin transactions will be subject to capital gains tax
Hong Kong
Hong Kong has no regulations for bitcoin or any other virtual currency. However, the government is closely monitoring the use of bitcoin to prohibit money laundering, fraud and other illegal activities
India
India does not explicitly stipulate or prohibit the use of bitcoin. However, the Reserve Bank of India (RBI), equivalent to the Central Bank of India, has been forced to shut down India's largest bitcoin trading platform after it issued a notice that the use of bitcoin could cause money laundering and security problems
Israel
the Israeli tax authority is considering levying income tax on bitcoin transactions. Israeli banks even blackmail bitcoin payments
Kyrgyz
Kyrgyz central bank has banned the use of digital currency and bitcoin for the reasons of lack of centralized management, high currency risk and legal problems
Russia
the Central Bank of Russia believes that bitcoin may be used for money laundering and terrorist financing. Therefore, the Russian government banned the use of bitcoin
Taiwan
Taiwan's financial supervision commission is concerned about the uncertainty and speculation of bitcoin, so Taiwan opposes the installation of bitcoin ATM
UK
at present, there are no relevant regulations for the bitcoin. Profits or losses from bitcoin transactions are subject to capital gains tax, while the purchase of bitcoin is still subject to VAT
the U.S.
the U.S. is probably the most supportive country for virtual currencies such as bitcoin. There are no final rules on bitcoin. However, there are also many new rules for the establishment of bitcoin management framework.

6. Because Europe has seen the development potential of virtual currency and is graally using bitcoin in major trading projects, it will relax the regulation of new currencies.

7. When it comes to downloading software from the US or your favorite songs from Australia, it's no surprise that tech savvy people and those who want the UK to leave the EU assert that geographical proximity has never been less important. This is Daniel, a member of the European Parliament and a member of the British Conservative party who supports brexit; One of Daniel Hannan's favorite words. But it is precisely wrong. Take two countries for example, one has a historical origin with Britain and uses the same language, and the other is only located in the middle of the European continent. According to the current exchange rate, the economies of New Zealand and the Czech Republic in 2014 were both US $200 billion, and the trade between the UK and one of them was significantly more than that between the UK and the other. In 2014, the import and export scale of goods and services between the UK and the Czech Republic, which is not too close to each other, was 3.9 times larger than that between the UK and Australia, which is a distant former colony. This is not isolated evidence. Britain may not play much cricket with Spain, but its trade with this historic foe is 3.3 times that of Britain with Australia. The economies of Spain and Australia are both US $1.4 trillion, but the British prefer to go to neighboring Spain to enjoy sunshine and Sangria, rather than go all the way to Australia to experience the life in "neighbors", an Australian TV series that has been broadcast for many years. In the area of trade, location still matters, but distance is not the only determinant - market size also matters. With the rapid growth of China's proportion in the global economy, the trade between Britain and China has naturally expanded. China's share in Britain's foreign trade is certainly on the rise, but we should not exaggerate the importance of China. China's gross domestic proct (GDP) in 2014 was US $10.4 trillion, and the Sino British trade only accounted for 0.9% of China's economic scale, far lower than the proportion of the trade scale between the EU and the UK in the former's economic scale, which was 5.5% in 2014. Not only is the UK's trade with the EU much closer in terms of market size than its trade with China, but the importance of location also seems to be rising, or it can be understood as falling. In 2004, China's trade with the UK accounted for 1.4% of China's economic scale, which is higher than today's, but the trade intensity with the EU has remained basically unchanged. The so-called gravity model finds that the UK's trade with Europe may be closer than the model predicts, largely because the market is far more integrated than the free trade area. Trade gravity model is a kind of economic analysis, trying to explain trade pattern through geographical location and market size. Although the theory of trade in economics began with David; The story of David Ricardo exchanging Portuguese red wine for British cloth, but most modern trade is characterized by the exchange of similar goods and services between similar markets. This kind of exchange is beneficial because it increases market competition, and competition can promote procers to improve process and management, eliminate inefficient procts, and thus improve proctivity. Recing tariffs and eliminating quotas will expand trade and bring benefits, but deepening integration, unifying regulatory system, recognizing other countries' standards, prohibiting artificial government assistance and eliminating non-tariff barriers are more effective laws. The only large closed market in the UK that can enjoy these benefits is the European single market. All the other big markets are too far away. Countries and enterprises are often reluctant to promote deep integration, because the weak will complain loudly. But it should be. The European single market has developed well in terms of free flow of goods, but it still needs to break down the obstacles hindering the free flow of services. So even if the UK votes to leave the EU, it would be foolish for the UK to leave the single market. Of course, staying in the single market means that the UK will have to pay market access fees, accept the free movement of people, the regulatory rules set by Brussels and the sharing of sovereignty. In that case, we have reason to ask: what is the point of brexit?

8. High unemployment is the result of economic depression. Economic depression plus inflation is stagflation. When stagflation occurs, there is no solution. Because raising interest rates to deal with inflation exacerbates the economic depression. Lower interest rates to deal with depression will increase inflation. The guy on the first floor actually said the same thing as me, but he made a mistake. In order to deal with the depression, he pointed out to adopt a loose fiscal policy, that is, to increase investment. This is a dead end. Because the economic depression itself is caused by insufficient consumption. If you continue to increase investment, you will continue to increase the construction of proction capacity. However, the built proction capacity is still not supported by consumption, and a new overcapacity will soon form. Then, the old overcapacity and the new overcapacity together are more troublesome than before. What's more, as my friends on the first floor said, loose fiscal policy will also aggravate inflation. Then, my friends on the first floor pointed out that we should tighten the monetary policy. This in itself contradicts the loose fiscal policy. If we really do this, it will be the same as increasing the discharge of water from the pool on the one hand, and tightening the tap of the water inlet pipe on the other hand, which will inevitably lead to the drain of water from the pool soon, resulting in financial contraction and the shortage of income. Finally, it is inevitable that the debt will rise and the income will decrease until bankruptcy.