Banking center Switzerland gives a big boost to Bitcoin

Paypal’s Director sees it as a store of value, adds that regulation will boost merchant adoption

As hectic volatility on the Bitcoin exchanges goes on, we are on a mission to explore recent factors behind the latest batch of dramatic moves. Yesterday Swiss lawmakers have given the needed “governmental” boost to the crypto-currency with a group of 45 members (out of 200 possible) of the Swiss Parliament signing a postulate that argues for Bitcoin to be treated just as any other foreign currency would be.

Only days after China has slapped investors in the face, Swiss authrities are coming to the rescue, and this one is rather big!

If such a measure passes through the Parliament it would be up to the Federal Council to agree and decide how to implement the postulate according to a recent article by Coindesk. This could ultimately bring a benefit to the traditionally strong financial system in Switzerland and could turn the country into a hub for Bitcoin dealings.

Switzerland’s renowned worldwide reputation as a solid and secure base of operations will could once again come into play. However significant measures need to be undertaken before it all becomes feasible – prevention of money laundering and regulation of VAT application are few of the challenges faced.

The main difficulties lie within the nature of the currency – along with legal issues come technological ones and both frameworks will need a lot of proper analysis and thorough considerations before invoking appropriate legislation marks and formally recognizing Bitcoin as a legitimate foreign currency.

Coindesk proceeded to quote Luzius Meissier who is the president of Bitcoin Association Switzerland who said that the proposed action could be revolutionary in providing Bitcoin with additional legitimacy and serve as a precedent for other countries.

Recently representatives of the University of Nicosia in Cyprus have issued a proposal to their financial authorities to make the island as a hub for crypto-currency dealings. Well it remains to be seen whether authorities have even considered it, however with competition such as Switzerland they stand little chance to get a part of this pie.

On a separate note we have bumped into set of surprising comments coming from no other but the President of Paypal at eBay – David Marcus. Speaking at a start-up conference in Paris he expressed his positive attitude towards Bitcoin and has brought his insights into the highly controversial topic of the digital currency.

In fact he stated that the main reason that makes people confused about Bitcoin is that it is called a currency. According to Mr. Marcus it is not a currency so far, it is a store of value especially in countries with high inflation rates such as Argentina where fiat paper money have completely lost this function. He proceeded to say that he considers investments in Bitcoin to be associated with a big appetite for risk. The main obstacle in his opinion is the daily volatility that is accompanying the crypto-currency and the uncertain regulatory framework.

As soon as the framework becomes clearer many merchants will start seeing it as a good alternative. Speaking of which recent media reports about a Tesla Model S sedan being bought in Bitcoins turned out to be a lot of fuss. In an interview with CNBC, the general manager of the dealership that sold it, said that the company has never actually put its hands (or cursors) on Bitcoins. The transaction went through BitPay and the company received the payment in US dollars.

It is a tough going to follow all news about Bitcoin these days. Its ever increasing popularity will certainly make us here, at LeapRate put in our better efforts to stay in tune with this exciting market. Stay tuned for more!

For more on the global Forex industry see the LeapRate-Dow Jones Forex Industry Report.

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Banking center Switzerland gives a big boost to Bitcoin


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