Following moves by China and Japan to regulate digital currencies, Australia is attempting to crackdown on money laundering and terrorism financing with plans to regulate bitcoin exchanges.
Recently, the Australian government announced that as of July 1st 2017, Bitcoin will be considered real money and it will also be exempted from goods and services tax (GST). This suggests that the crypto-currency could be about to go mainstream Down Under.
So if you hold Bitcoin you can now travel all around Australia booking your favorite hotels and airlines. If you are a coffee enthusiast, coffee shops such as Imbiss25, Beaver Tail Social Club and The Little Mule, which are located in Melbourne, all accept Bitcoin as a form of payment.
Elimination of double taxation on bitcoin
Earlier this year, in an attempt to recover its fintech and bitcoin industries, the Australian government announced the elimination of double taxation on bitcoin. It also noted that bitcoin will be considered to be a legal commodity and settlement network. In its official 2017-2018 budget report, the Australian government vowed to create an improved ecosystem for bitcoin businesses and to treat bitcoin just like other forms of money.
As more official bodies and governments show trust in this new currency, it is likely that consumers will feel more attracted to it. One misconception that is consistent with the general public is that if you hold Bitcoin you will just get rich in a couple of years. It is unlikely that this is going to happen.
Difference with Bitcoin and other currencies
Bitcoin needs to be seen as a currency like any other. The key difference with Bitcoin and other currencies is that it is brand new. It is only normal that there is going to be ups and downs until more countries like Australia start embracing it as the currency of the future, and not an investment.
Alternatively, if you don’t want to deal with these fluctuations, the safest way that seems to be currently available to get involved in this new currency is if you trade bitcoin with CFDs online. CFDs, which are also known as contracts for difference, allow traders to bet on the value of Bitcoin rath. The move has been welcomed by Aurélien Menant, founder and CEO of Gatecoin, a digital currency exchange based in Hong Kong, calling it a “very positive” development.
It signifies the growing recognition of bitcoin and other crypto-currencies as influential value transfer protocols by governments. Compliance with AUSTRAC policies will weed out the crooks and ensure that only serious bitcoin businesses are able to serve the market.
Anti-money laundering processes
So far in both Japan and China, the ‘Know Your Customer’ and anti-money laundering processes of exchanges have become stricter, but this has not deterred trading activity as Japan and China remain the largest markets for crypto-currency trading globally. One challenge for Australia will be trying to regulate exchanges based outside of the country but serve Australian clients, as some of these may not use any ‘Know Your Customer’ or anti-money laundering processes, Menant warned.
As it stands, Bitcoin is not yet the “go to” currency in terms of exchanging money for goods and services. But it is getting there – after all it allows for faster and cheaper transactions and is evolving into something the world won’t be able to ignore for very long.