Topic: European Union Parliamentary questions about bitcoins (Read 396 times)

Guess the governments can't bust anyone if Bitcoin isn't considered as currency.

Thanks for sharing.

Quite interesting to read that in their view the limitation to 21 million coins is what disqualifies BTC as a real alternative to traditional currencies.

http://www.europarl.europa.eu/sides/getAllAnswers.do?reference=E-2013-004223&language=EN

Parliamentary questions
12 June 2013   
E-004223/2013
Answer given by Mr Barnier on behalf of the Commission

The market value of bitcoins in virtual circulation is approaching one billion euro. Whilst being a non-negligible figure, it is still a rather limited value compared to the value of euro coins and notes in circulation, which is about 900 times as big. Bitcoins may, as any financial scheme, represent challenges in terms of speculation, fraud and illegal activities. However, due to the still very limited acceptance of such virtual currencies by users and the low volumes traded, the risks remain relatively limited at this point.

Because of its low liquidity and very limited acceptance bitcoin does not appear to possess the necessary attributes of a reserve currency. Moreover, its supply characteristics, based on an algorithm, severely limit the quantity of bitcoins in circulation. The total amount of bitcoins in circulation is limited to 21 million bitcoins, to be achieved in 2040. This makes bitcoin an unlikely alternative for reserve currencies.

The Commission in December 2012 presented its vision for a strong and stable EMU architecture in the communication(1) ‘a Blueprint for a deep and genuine Economic and Monetary Union’. The Commission is working closely with all stakeholders to enhance economic governance and financial stability in the euro area. Measures implemented at EU level in the context of fiscal and macroeconomic surveillance and the new EU banking and financial market supervisory framework should contribute to preventing the accumulation of macroeconomic imbalances in Member States and reinforce macro-financial stability in the EU.

(1)   Dated 28.11.2012. COM(2012) 777 final.