Bitcoin should not be taxed at exchanges, Europe's top court has ruled.
The news broke out on Bloomberg (opens in new tab)on Thursday morning. The European Court of Justice (ECJ) said virtual currencies should be treated in the same way as traditional money.
An advocate general — a kind of legal advisor to the ECJ — had said in a legal opinion that bitcoin should not be taxed. It recommended that Europe "keep payments with bitcoin out of scope of VAT as bitcoin can be considered a 'pure payment system,'" tax lawyer Roger van de Berg told Business Insider (opens in new tab).
Deloitte, a multinational professional services firm, has said it might be too soon to try and regulate bitcoin. In a publication titled Bitcoin at the Crossroads (opens in new tab) Deloitte explores whether regulating digital currency could potentially have a negative impact on its future development and potential to reach mass adoption.
"In most respects, while policy makers and regulators are acting in accordance with their mission statement to protect the public and the integrity of the financial markets, an important question comes to the fore – is it too soon to try and regulate bitcoin?“ it says in the publication.
According to the publication, there are three reasons why bitcoin should not be regulated yet: its market penetration is still too small, we're still far from true demand, and bitcoin has not yet found its most valuable application.
"Bitcoin is receiving a remarkable amount of attention and scrutiny from policy makers and regulators all around the world – far beyond what its current scale and market impact would seem to justify. In fact, by any relevant benchmark, the value currently at risk with bitcoin is just a drop of water in the ocean that is the financial industry."