Frankfurt: ECB calls for tax on bitcoin

A top official at the European Central Bank (ECB) has called for governments to tax and regulate bitcoin as the official went on to label the cryptocurrency as an speculative object and an instrument for money laundering.

Ewald Nowotny, head of Austria’s central bank and ECB governing council member, has stated that a value-added tax on bitcoin is necessary “since it’s not a currency”. Nowotny’s beliefs reflect that of comments by other ECB officials, who also view bitcoin’s significant surge in value as a bubble.

Benoît Cœuré, ECB executive board member, agrees with his peer and states that one of their main concerns is tax evasion and inevitably money laundering. Cœuré  went on to say that with bitcoin, "there is a risk of large capital losses which investors should be aware of." 

However, the cryptocurrency is still a concern for central bankers due to the fact that it can permit money launderers to evade increasingly stringent rules in the traditional financial system.