Bitcoin's Popularity in E-Commerce to Decrease

According to the expert, the irreversibility of bitcoin-transactions is a problem, especially when a trading company or consumer faces fraud
02 August 2018   1177

The use of bitcoin in e-commerce is declining. This is evidenced by the results of a study conducted by the blockchain start-up Chainalysis Inc., Bloomberg reports.

The report says that after the peak of activity in September ($ 411 million), the turnover of the largest processing-oriented processing services went down. By May 2018 this figure was already $ 60 million.

Amount of BTC Received
Amount of BTC Received

In June of this year, this indicator slightly increased - up to $ 69 million, but this figure is several times less than for the same period last year ($ 270 million).

According to Nicholas Weaver, senior researcher at the International Institute of Computer Science, the irreversibility of bitcoin-transactions is a problem, especially when a trading company or consumer faces fraud.

Senior Economist Chainalysis Kim Grauer is confident that the active use of cryptocurrency for everyday calculations is hampered by still fairly high transaction fees. According to him, they make inexpedient the purchase of inexpensive goods.

The decline in activity in the use of bitcoin for purchases coincided with the peak of speculative demand for bitcoin, when in December last year its price almost reached $ 20,000. After a deep drop to below $ 6,000, in July this year the price of BTC began to show a fairly sharp recovery. However, this did not serve as a catalyst for demand for bitcoins for everyday purchases.

Grauer is sure that the wide distribution of bitcoin as a means of exchange is hampered by its still high volatility, even if the price of BTC goes up.

Israeli BTC Investors to Face Catch 22

They need to pay taxes from Bitcoin investing in order to avoid their property arrest, but banks don't take their money due to AML issues
06 August 2019   142

Bitcoin investors in Israel are faced with the impossibility of paying taxes, as local banks refuse to accept funds received from the sale of cryptocurrencies because of the risks of money laundering and terrorist financing. About this writes the local edition of Haaretz on August 6.

Bitcoin is not recognized as a currency in Israel, therefore, individuals must pay 25% of the income from cryptocurrency trading to the treasury, and legal entities - 47%.

Investor Ron Gross told the publication that he acquired bitcoins in 2011 and reported his income to the tax office. In 2017, the bank that served Gross began to refuse to accept funds received from the sale of bitcoins. The investor met with representatives of the bank to demonstrate to them a 70-page history of bitcoin transactions as confirmation of the origin of the funds, but failed to convince them.

The tax authority is aware of the problem, but they say the ball isn’t in their courts. I’ve tried working with almost all the banks, but the minute they hear the word ‘Bitcoin’ they freeze up.
 

Ron Gross

Bitcoin investor from Israel

 

Since Gross was unable to pay taxes on time, his bank account, home, and even scooters were arrested. According to the investor, the tax authorities know about the problem, but can do nothing.

According to Haaretz, the tax office is aware of $ 86 million in unpaid taxes on income from cryptocurrency trading. It is possible that the real amount may be significantly higher.

Roy Arav, another Bitcoin investor, kept the proceeds from trading Bitcoin in an account with Israeli bank Discount under the control of the Bit2C exchange. The bank refuses to transfer money to Arava’s personal account under the pretext that its politicians forbid it to transfer funds related to virtual assets to client accounts due to the risks of money laundering and terrorist financing.

Arav also could not pay taxes and was forced to sue the bank. According to the investor, the authorities entered his position and granted him a deferral of time for the consideration of the claim.