Germany Classifies Bitcoin And Crypto As Financial Instruments
The crypto market is struggling to recover its value following the recent significant price drops of the most important coin in the market.
There have been various reasons for which analysts claim that the price of Bitcoin dropped this year. They include the global fears of the coronavirus, whale selloffs, normal corrections ahead of the Bitcoin halving, which is scheduled for May, a recent US SEC decision which denied another ETH and more.
Bitcoin and crypto are legal financial instruments in Germany
Bitcoin and cryptos are now legal, financial instruments in Germany, according to new guidance that’s been issued this Monday by the country’s Federal Supervisory Authority or BaFin.
“[They are defined] as digital representations of a value that has not been issued or guaranteed by any central bank or public body and is not necessarily linked to a currency specified by law and that does not have the legal status of a currency or money, but is accepted as a medium of exchange by natural or legal persons and can be transmitted, stored and traded electronically.”
This new classification comes right after BaFin updated its anti-money laundering laws.
Definition of a crypto custodian company
BaFin provides a clear definition of what constitutes a crypto custodian firm, according to the latest reports coming from the Daily Hodl.
“The legal facts of the crypto custody business are fulfilled by custodians who take crypto values into care as a service for third parties. This primarily includes service providers who store their customers’ crypto values in a collective inventory without the customers themselves being aware of the cryptographic keys used.”
One of the main goals in the crypto space was the mass adoption of digital assets back in 2019, and there have been a lot of moves made in this direction.
In 2020, the goal is the same, and regulation is one of the essential ingredients towards its achievement.
Eduard Watson Author
An experienced finance writer for more than 10 years, active industry watcher, and gadget enthusiast.