Candidate to N.Y. Federal Reserve: Crypto Isn’t Currency

The offer that cryptocurrencies comprise currency has been rejected by the president and chief officer of the San Francisco Federal Reserve Bank, John Williams
23 April 2018   1125

Mr. Williams, the nominee to head the New York Federal Reserve, has declared  that “Cryptocurrency doesn’t pass the basic test of what a currency should be.” Mr. Williams stated that currencies should comprise “basically something with a store of value,” also underlining the necessity for currencies to be “elastic” in order to accept to a wide range of economic conditions and circumstance. Despite the criticisms, Mr. Williams did not manage to further elaborate on how cryptocurrencies fail to or could better fulfill the above-mentioned monetary functions.

The idea of the supply of currency and thinking about currency really belongs more in the sphere of government and central banks. My view is it’s really more of a promise of technology.
John Williams, the president and chief executive officer, San Francisco Federal Reserve Bank

Mr. Williams also claimed that the cryptocurrency sphere suffers from “problems with fraud, problems with money laundering, terror financing.” Mr. Williams is to be appointed as the head of the New York Federal Reserve Bank in June when the current president, William Dudley, will step away from the stance. 

Mr. Williams’ statements come following weeks of heavily hostile rhetoric issued representatives of various federal reserve banks in the United States.  
At the beginning of April, Federal Reserve Board of Governor member, Lael Brainard, pointed out that the institution is “monitoring is the extreme volatility evidenced by some cryptocurrencies.” 

Also the president and chief executive officer of the Federal Reserve Bank of Atlanta, Raphael Bostic, at the end of March refused the proposition that cryptocurrencies lke Bitcoin comprise money. Mr. Bostic discouraged consumers from investing in the virtual currency markets.
In January, the president of the Federal Reserve bank of Chicago, Charles Evans, claimed that bitcoin is “Not money-like at the moment,” adding that the investors in cryptocurrency are “swimming with all the sharks in the world because of all the anonymity.’’

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   132

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.