Beijing Watchdog Won't License Crypto Exchanges

The Beijing Financial Bureau won't tolerate cryptocurrencies because they cannot be used as legal digital currencies
13 January 2020   116

Huo Xuewen, director of the Beijing financial regulator, said that control over cryptocurrencies in the capital of China will be tightened, 8btc writes. The Beijing Financial Bureau has "zero tolerance" for the issue of cryptocurrencies, since cryptocurrencies cannot be used as legal means of payment in a digital form. Huo emphasized that only the People’s Bank of China can issue legal digital currencies.

According to the regulator, many virtual currency exchanges use the structure of a legal entity with variable equity participation to reduce risks. This structure assumes that the foreign legal education of the exchange is separate from the local one - the latter in this case is a subsidiary of the former in Chinese jurisdiction. Such a unit is not engaged in commercial activities in the main direction, but is responsible for business and finance in the domestic market in accordance with the agreement.

Huo said that the regulator is aware of this phenomenon, and the issue, sale and exchange of cryptocurrencies in China are considered illegal activities. At the same time, companies selling cryptocurrencies to Chinese citizens through financial pyramids or attracting investors to cryptocurrencies through various channels will be held accountable by law.

He also stressed that no company or trading platform is allowed to sell cryptocurrencies to local investors.

In addition to speculation, cryptocurrency has no real value. There is no need for a trading platform that has no real value but can only cause investors to be cheated and social instability.

 

Huo Xuewen

Director of the financial regulator in Beijing

 Earlier, Beijing police stopped the activity of the BISS cryptocurrency exchange, arresting dozens of suspects. Huo commented on this information, noting that the exchange was registered in a foreign jurisdiction and had an operating unit in China.

China does not allow cross-border cryptocurrency transactions. No institution can sell overseas cryptocurrency to Chinese, and no institution can provide the exchange of cryptocurrency to CNY. For this, we will closely monitor and crackdown on it.

 

Huo Xuewen

Director of the financial regulator in Beijing

 Asked if China could deal with licensing cryptocurrency exchanges in the future, Hao said he didn’t think so.

Bithumb Filed Appeal Against Korean Tax Office

Looks like the korean exchange doesn't really want to pay an additional tax worth $67 000 000
16 January 2020   97

The South Korean cryptocurrency exchange Bithumb has filed a complaint against the National Tax Service (NTS) because of the requirement to pay additional taxes for the transactions of its foreign customers.

The company claims that cryptocurrencies do not have an official status in the territory of South Korea, which is why the authorities cannot have sufficient reasons to levy any taxes.

The tax court will have to decide within 90 days whether to retain or withdraw from Bithumb the obligation to pay the $ 69.1 million tax that was assigned to it by NTS in November. The Office declares that the withdrawal of income from accounts in Korean won by foreign residents is a taxable event. It is assumed that the exchange itself had to withhold tax from its foreign customers.

We paid the full amount and have since been preparing for arguments. We believe we will be given a chance to clarify our stance in court.

 

Bithumb

 The ministry has its own position on this issue.

Bitcoin under the current law is not an asset. It is clear and simple. The Ministry of Economy and Finance already made that clear. The NTS pushing ahead with the tax imposition is baseless and groundless, especially since it is still awaiting the ministry opinion on the same matter it sought again.

 

Choi Hwoa-in

Adviser to Financial Supervisory Service

According to the expert, the NTS maneuver is well thought out and aimed at starting to levy a tax on income that is currently not taxable.

We cannot comment on the ongoing matter. We will await the judgment from the Tax Tribunal.

 

NTS

Earlier, Bithumb was ordered to pay an additional $ 67 million in tax.