Italy is considering a proposal that could pave the way for the taxation of bitcoin transaction.
Several days ago, a local taxation office tabled a proposal introducing bitcoin—which currently has no legal definition in Italy. This proposal has yet to go into effect, but when it does, companies dealing with bitcoin and other digital currencies will be required to pay its dues to the Italian government.
However, it appears that the proposal doesn’t apply to consumers and other people who deals with bitcoin.
Still, this plan goes against the European Union’s stance on bitcoin taxation. In October, the European Court of Justice declared that the exchange of bitcoin and other digital currencies should be treated like traditional money, meaning they should be exempted from value-added tax (VAT).
Study: Virtual currencies not a threat to fiat
For the cryptocurrency skeptics, this one’s for you.
A new research paper published by the Swift Institute dismissed fears that virtual currencies poses immediate risks to monetary, financial or economic stability. In fact, it’s unlikely that cryptocurrency will crowd out fiat currencies.
“The price impact of speculators in virtual currencies adversely affects their property as a medium of exchange and renders a crowding out of existing fiat currencies, such as the U.S. dollar, unlikely,” the paper stated.
The institute also pointed out that there’s no correlation between bitcoin and traditional asset classes since “bitcoin returns are uncorrelated with traditional asset classes such as stocks, bonds and commodities, both in normal times and during periods of financial turmoil.”
Current bitcoin price and trade volume
The price of bitcoin continues to rise—albeit slightly—on Wednesday, trading at $607.99 per bitcoin with a market cap of $9.73 billion and trade volume of $14.15 million.