Posted by: DeepDotWeb
December 21, 2014
Recapping the week’s biggest Bitcoins stories from around the web.
Former Bitcoin Foundation vice chairman Charlie Shrem will be spending the next two years in prison. As Nate Raymond of Reuters reports, Shrem plead guilty in September to “aiding and abetting an unlicensed money transmitting business.” He was also asked to give up $950,000 for his crimes Previously, Shrem had faced up to five years in prison for his role in Silk Road, but his lawyer argued for probation on the basis that “the case had already sent a message to the bitcoin community.”
Due to weak oil prices and economic sanctions, the Russian economy is in a state of disarray. The country’s citizens appear to be moving into bitcoin as the ruble tanks. According to Matt Clinch of CNBC writes, bitcoin and the ruble simultaneously saw its transaction volume spike on Tuesday as the Russian fiat currency continued to fall. The euro, the yen, and the pound sterling also benefited from “this flight from Russia.” According to Bobby Lee, the CEO of BTC China, the cryptocurrency is “a natural destination” for those who are seeking to exchange their ruble holdings.
Regulation and Taxation
Changes to New York State’s “BitLicense” regulations have been outlined by its top financial regulator, Benjamin M. Lawsky. As Sydney Ember of The New York Times writes, the rules will be published by the state’s Department of Financial Services “in the coming days.” Afterwards, the public will have 30 days to offer comments. Lawsky has stated that the new rules will not require software developers and Bitcoin miners to maintain licenses to continue their operations. Not only that, but the new rules will also offer a “two-year transitional BitLicense” to start-up companies and small businesses that may not be able to pay “the cost of compliance.”
Bitcoin is now subject to Australia’s goods and services tax. Alex Hern of The Guardian discusses the ruling, which will apply to bitcoin exchanges. From now on, Australians who buy bitcoin from an exchange will have to pay a tax on their purchase. As a result, Hern indicates that it will now be more expensive to run a bitcoin exchange in the country. Because the GST is not used to tax fiat currency conversions, the ruling also means that bitcoin is also unlikely to be viewed as money in the country.
While New York and Australia may be moving to regulate and tax the currency, the Federal Senate of Brazil wishes to take its time to evaluate the situation before making a decision. According to Pete Rizzo of CoinDesk, the report, which was authored by Banco Central do Brasil researcher Cesar Rodrigues van der Laan, had determined that Brazil should not immediately regulate the cryptocurrency. One of the principal reasons that van der Laan cites is the lack of activity in local markets. When the time comes to make a decision on the cryptocurrency, however, the report concludes that Brazil should tax bitcoin as an asset.
By combining the services of Tuition.io and Brawker, student loan debt holders can save 17% on their payments. Alex Gorale of CryptoCoins News describes the payment strategy, which uses Brawker, “a site where users post bitcoins, at up to 20% markup, in exchange for goods.” Student loan debt holders can then sell their bitcoins at a 20% markup for a Tuition.io gift card. The example Gorale offers involves the purchasing of a $500 gift card for only $441, which equates to a savings of 17%.
Magazine publisher Time Inc. will now be accepting payments for certain magazine subscriptions. Sydney Ember of The New York Times discusses this partnership between Time Inc. and Coinbase, who will process the subscription payments. From now on, Time Inc. consumers can purchase subscriptions of magazines like Fortune, This Old House, Health, and Health and Leisure. However, customers are not currently able to make subscription payments for People, Food and Wine, and Sports Illustrated. Coinbase CEO Brian Armstrong believes that Time Inc.’s decision to accept bitcoin payments “sends an important message to both its readers and to the broader media community.”
Bitcoin holders who wish to purchase goods and services can now do so on BTXDeals.com. Natasha Lomas of TechCrunch discusses the U.K.-based e-commerce site, where users can make payments for computer displays, software, and travel services. The prices are updated every ten minutes and are based on the Bitcoin-GBP Sterling exchange rate and vendors do not have to pay to list their goods on the site.