Weekly news (Bitcoin High Point, Bitcoin Conference, Bitcoin in Russia)
The first two weeks of 2017 have proven to be very calm in the Bitcoin world. The price of our beloved cryptocurrency has been relatively stable, opening the year with a value of just under $1,000.00 usd and currently trading at just under $830.00 usd. Being able to say that this is a relatively calm period is a wonderful indicator of just how volatile Bitcoin really is, to say the least. Of course, it is this volatility that makes Bitcoin a great financial tool. The past week has been full of news, announcements and a couple surprises that have made the Bitcoin community pay attention a bit more. All in all, it was a week like many others, yet totally unique.
2017 Bitcoin High Point
On January 4th, Bitcoin reached a trading value of $1129.87, the highest trading value of 2017 so far. This past week, it has shown a moderately sideways trend following a steep decline from $915.22 down to $759.39 on January 11th.1 Since that time, Bitcoin has made a slight rebound and has been trading sideways in the low $800’s. Given the sideways action after the last significant upwards trend, we can expect another upward trend to occur following the period we are currently in. Just how much will it rise? That is tough to say, but grabbing some Bitcoin now would be a prudent decision.
North American Bitcoin Conference Gearing Up in Miami, Florida (USA)
While it has not happened yet, I am including it in this weekly review as a reminder to anyone who wants to attend the conference. The conference will take place in Miami, Florida on January 17th & 18th. The conference will feature over 150 famous speakers and focus on innovations and technologies that will help to shape the future of Bitcoin and Bitcoin related entities. Tickets are $399.00 USD, and if you use this Promo code, it will save you $50.00.
North American Bitcoin Conference $50.00 Promotion Code: WELOVEBITCOIN
Russian Finance Minister: “Bitcoin not a threat”
Alexey Moiseev, Russia’s Deputy Finance Minister is not known for his firm stances on Bitcoin. He has been very back and forth on the subject of Bitcoin and other cryptocurrencies in the past. However, this past week he released this statement:
“So far we decided to watch it carefully and how it’s developing. We decided that the Central Bank and the Federal Financial Monitoring Service should monitor cryptocurrency for Russia’s economic security. So far these agencies believe that there is nothing critical in it. That means they understand that (threats) may appear in the future, but now they do not exist.”
This comes after many months of signs that Russia was taking a hard stance against Bitcoin and other digital currencies, with promises from the finance ministry of jail sentences. A few Bitcoin related websites have been blocked and reports from many news services reported that Bitcoin and other digital currencies were in fact illegal in Russia. This misinformation caused much uncertainty but can finally be put to rest with these official statements from Russian leaders.
More Assurance for Russian Bitcoin Users
After 2 years of rumors of Bitcoin’s legality, supposed jail sentences for involvement with Bitcoin and other worrisome news about Russia’s stance on the cryptocurrency, it was a relief for many Russians when this past week, the Russian Federal Tax Service released a document concerning their official stance on Bitcoin and cryptocurrencies in general. One of the documents many statements stated:
“The Russian laws do not contain any prohibitions as to operations with cryptocurrencies conducted by Russian citizens and organizations.”
This document, and in particular, the aforementioned statement should finally close the door to the speculations, misinformation and doubts whether or not Russian Bitcoin users have to worry about being jailed for their involvement in the cryptocurrency trading world. While sanctions, regulations and government involvement in Bitcoin can almost definitely be expected in the future, Russian users can rest assured that they are allowed to freely trade Bitcoin and other digital currencies with no fear of criminal repercussions.
European Officials Promise Tighter Rules for Digital Currencies Before End of 2017
European leaders want to reduce the anonymity of digital currencies because they fear that cryptocurrencies like Bitcoin make it easier for terrorist organizations to get funded and to help fund their plots. According to the recently released documents, which are the standard papers the EU committee uses to address current priorities that need to be addressed, by reducing the anonymous aspects of Bitcoin, good-faith users will have increased trust. The regulations they wish to implement would require that trading platforms and markets to collect and verify personal information from their users and report any suspicious activities to authorities.
Nigerian SEC Issues Warning About Bitcoin
This past week, Nigerian SEC officials released a statement declaring that investing in digital currencies was “risky” and that investors were taking a “high risk of loss of money.” The SEC took these actions due to advertisements, mainly on Nigerian radio that promote Onecoin and following the announcement that the Ponzi scheme system, MMM would be reopening its service based out of the African country.
Onecoin, which is widely accepted to be a fraudulent currency, also operates from within the Nigerian borders and came under fire by the Nigerian SEC. This is not the first time that Nigerian officials have warned against cryptocurrency schemes. While Nigerian officials have discussed creating rules surrounding digital currencies in the past, no legislation has ever been passed within the country.
Israel Tax Authority Finds way to Tax Bitcoin (The jokes would be way to easy)
All Jokes aside, The Jewish leaders have decided to follow a 2014 United States Law that creates a way to get more money from Israel’s tax payers. While this will come as no surprise to many, and most would say it was only a matter of time, this could actually harbor bad news for the rest of the world too.
Israeli tax officials want to treat Bitcoin as “property”, rather than as a currency. This would classify Bitcoin and all other digital currencies as a kind of intangible asset instead of currency. By doing this, digital currencies would be subject to the Capital Gain Tax, making all profits taxable at a rate that begins at 25%. Tax officials released a long statement explaining their reasoning. While the entire statement is very detailed, it is this section which garners the most attention and delivers the impactful news:
“…and therefore [bitcoins] will be considered in accordance with the Income Tax Ordinance as assets and their sale will be taxed as a sale of ‘property’ and income from their sale will be classified as capital.”
While the United States began taxing income and capital gains from digital currencies 2 years ago, the Israeli decision can ultimately become more impactful for the rest of the world due to the stricter enforcement of tax law within the Jewish nation. The wording of the law passed by US officials is very loosely worded and meant to serve as a guide for tax payers, whereas the Israeli officials are fine tuning it to be an iron clad law.
Coinbase Requests its Day in Court
In a surprise motion filed in court by Coinbase, the California Bitcoin start-up wants to intervene in a federal court case involving the Internal Revenue Service (IRS) and one of its users, Jeffrey Burns that stemmed from a recent attempt by the IRS to subpoena the records of all Coinbase’s users that live in the United States. The move by the IRS has been delayed due to Mr. Berns’ filing motions to block the IRS from obtaining those records. Coinbase has not made any public statements or responded to the IRS’s attempt until now.
Lawyers for Coinbase filed the motion to intervene in the case to ensure that their business interests were represented since any decision made by the courts would ultimately affect them as a company, and their U.S. user base. The full court filed motion can be viewed at Coindesk’s website, whose owners also have a stake in Coinbase.
Bitcoin Exchanges in China Update Policies to Comply with New Cryptocurrency Regulations
The three major Chinese Bitcoin Exchange websites have updated their terms and services to meet the new regulations that Chinese leaders have imposed following a meeting last week that involved leaders from the respective exchanges and representatives from the Peoples Bank of China. So far, the most noticeable changes revolve around Margin trading, Margin Trading Loans to be specific. These services have either been totally suspended or have been greatly modified, ultimately reducing services greatly. While no definitive comments have been issued and no one is yet sure if these suspensions of margin trading are temporary or permanent, the one thing that is for sure is that there will be new regulations in the coming weeks.
In related news, Bitcoin123, a Chinese start-up focused on Bitcoin investing is also greatly changing their terms and services. They will be closing down their financial management systems that are denominated in Bitcoin or the Yuan on January 26th. They released a brief statement, saying they were taking actions to comply with Chinese law.
A Bright New Week
With the inauguration of Donald Trump as the 45th President of the United States of America looming this week, the Bitcoin community and the activity we cause within the greater world should be ready for some interesting things. The past week was full of things happening and a lot of changes that directly affect us. This next week has the potential to see even more activity for Bitcoin and other digital currency communities. We can only look forward with our heads and our hopes held up high.
Gene is an avid Bitcoin enthusiast and computer programmer who is currently studying to be a software engineer. He is 40 years old and lives in Daytona Beach, Florida with his girlfriend and their son.
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