Spanish Treasury May Treat BTC As Money - Essay Example

Spanish Treasury Implies That Bitcoin is treated as Money.

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Recently, the Spanish Treasury has replied to an inquiry about Bitcoin gambling from Abanlex, the law firm.

After Law firm Abanlex demanded clarifications about Bitcoin, the Spanish Treasury provided answers saying that gambling sites will need licenses and that Bitcoin is treated as money.

The lawyers wanted clarification on numerous issues from the Directorate General for the Regulation of Gambling (DGOJ).

The DGOJ is a government body which is accountable to the State Secretary of the Treasury. The State Secretary of the Treasury authorizes, regulates, supervises, and penalizes gambling actions in Spain.

Bitcoin users in Spain were supported by services like Segundamundo and Bitcoin ATMs.

Abanlex asked directly if the digital currency is considered as money and if using crypto currencies by gambling operators would involve the operators to obtain licensing and pay any fees.

The law firm also questioned whether those who are betting in Bitcoin have to check-out to fiat currency when their session ends. This question was not answered but the treasury responded to the other queries.

The Spanish Treasury said that the Bitcoin is basically a convertible digital currency which can be exchanged amid users and be converted into other currencies like dollars, euros and other crypto currencies.

It was also said that the activity of betting with Bitcoins is included within the definition of bets. Therefore, it is mandatory to get the general betting license and the matching singular license.

A lawyer at Abanlex, Pablo Fernandez Burgueno, explained the statement by Spanish Treasury to Teknautas.

He explained that the treasury does not directly qualified Bitcoin as money. However, it is considered similarly as the Gambling Act applies to the gambling services which operate in crypto currencies.

Based on the principle of analogy if something is considered then it applies for all and not just one law.

So, if the Treasury treats the digital currency as money under the Gambling Act, it will also treat Bitcoin as money in relation to Law 7/2012, which forbids cash payments to shield amounts exceeding 2,500 euros.

Prevention of Money Laundering and Terrorist Financing Laws prohibits it too.

A Union, Progress, and Democracy party deputy at the Congress of Deputies stated that if financial and monetary authorities consider Bitcoin as an electronic medium to be used as a method of payment, then Bitcoin would be formally bound by anti-money laundering and anti-terrorist financing restrictions on payments.

The Spanish Treasury’s decision, on the other hand, means that Bitcoin will be excused from the Value added tax which has been a major issue in some jurisdictions before.

The United Kingdom initially charged a VAT on Bitcoin trades but later changed its position exempting Bitcoin from VAT now.

The monetary treatment of Bitcoin in Spain might be emulated by the Netherlands and Finland.

At present, Australia is considering whether it should change the Goods and Services Tax (GST) on Bitcoin or not.