Cryptocurrencies have made their mark in almost every sphere of life. Even an international forum such as the G20 countries issued a document declaring cryptocurrencies as financial assets–not money.
This forum is an important platform for discussion of economics between developing countries and well industrialised countries. It includes countries such as the USA, UK, Germany, South Africa, Argentina, China etc.
This forum is the surge in tax evasions of cryptocurrency investment was certainly a point of focus for the finance ministers.
According to a draft document acquired by Bloomberg, “the cryptocurrencies lack the traits of sovereign currency”, the G20 countries have implied that the cryptos can be considered as an asset–not as a regular medium of exchange. While this news could be morally discouraging for some idealists but making it easy for countries to collect taxes rather than analysing the nature of cryptocurrencies could be the possible intention.
Cryptocurrencies are not yet strong enough to compete against the traditional economic system, according to Klaas Knot, the president of De Nederlandsche Bank NV. In his opinion, the cryptos do not satisfy the three roles money plays in the financial system—serving as a medium of exchange, a store of value, as a unit of account. He believes that cryptocurrencies can be considered as assets and shouldn’t be considered as a form of money that could replace the existing economic system.
The US, China, Israel and Russia see cryptocurrency as assets. However, other countries have softened their positions on cryptocurrencies which has largely helped the price of Bitcoin to reach a new high. Thus, cryptos have gained some confidence and security in the market. Even among the G20 countries, there was no clear consensus on the future of cryptocurrencies. Some governments consider cryptocurrencies to be valuable assets while others approach them with skepticism. Yet, the investors’ fears of a ban on the use of cryptocurrencies were dissipated with the neutrality of the European Central Bank on this issue, who state that they have no competence to regulate this matter.
Although, there have been diverse thoughts and statements about the credibility and significance of cryptocurrencies in the economic system, the investors’ have managed to retain their confidence through the rising prices as well as the moderate behaviour of the member countries. However, the investors must always be aware of their countries stand on cryptocurrency, investments and tax evasions so that if somehow the government bans or implies a new law, it does lead into heavy losses.
Whether you are looking to purchase cryptocurrencies as an asset or to spend it like hard cash, you can check out Unocoin for a variety of digital currencies!
Sources :
- https://cointelegraph.com/news/g20-considers-crypto-as-assets-not-currencies-according-to-document-draft
- https://zycrypto.com/g20-cryptocurrencies-are-not-currencies-but-assets/
- https://coingape.com/g20-summit-2018-debate-bitcoin-asset-vs-currency/
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