Arnaud Touati
Arnaud Touati

Scaring the regulators?

Is regulatory wariness really an obstacle to blockchain adoption? William Essex spoke to lawyer Arnaud Touati, associate member of the Paris Bar’s legalinnovation incubator.

William Essex: So what are the regulatory challenges posed by the use of Bitcoin in Europe, particularly for cross-border transactions? Arnaud Touati: Cryptocurrencies like Bitcoin are not regulated in the same way as other currencies. There are very complex regulations around correspondent transactions, which in Europe depend on both European and national regulatory authorities. Also, banks refuse to accept Bitcoin in the use of blockchain technology; they just don’t want people to use it. The EBA (European Banking Authority) has started a consultation on the need to regulate cryptocurrencies, but for now, they are not legally defined in Europe. In July 2014, the EBA issued a recommendation to European banking and financial institutions not to use Bitcoin or to offer services around it. The European Court of Justice confirmed, in October 2015, that the operation of exchanging Bitcoin for traditional currency was exempt from VAT – because Bitcoin was a virtual currency and not a...continued

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