Though Bank of America Merrill Lynch and Wells
Fargo have expressed positive attitudes about Bitcoin, don’t expect
JPMorgan Chase to follow suit. Jamie Dimon, chief executive of the largest bank
in the United States, denounced the virtual currency this week, and even
predicted its demise.
“It’s a terrible store of value,” Dimon told CNBC. “It could
be replicated over and over. It doesn’t have the standing of a government.”
Dimon cited criminal activity involving Bitcoin as a key
reason why his bank is likely to eschew the cryptocurrency. “A lot of it is
being used for illicit purposes,” Dimon said. “And the people who will get
upset with it are governments. Governments put a huge amount of pressure on
banks: know who your client is, did you do real reviews of that? Obviously it’s
almost impossible to do with something like that.”
Treasury Secretary Jack Lew also expressed to CNBC that he
is concerned about Bitcoin being used for illegal activity. Nonetheless, he is
taking a wait-and-see approach. “Bitcoin is a phenomenon that we need more time
to discuss,” Lew said. “From the government’s perspective, we have to make sure
it does not become an avenue to funding illegal activity or to funding
activities that have malign purposes like terrorist activities. You know, it is
an anonymous form of transaction, and it offers places for people to hide.”
Dimon, however, believes it is only a matter of time before
the government intervenes and imposes a series of restrictions, causing
Bitcoin’s appeal to wane dramatically. “They will eventually be made as a
payment system to follow the same standards as the other payment systems and
that will probably be the end of them,” he said.
It should be noted, however, that JPMorgan has patented
a digital payment system similar to Bitcoin, which features the ability to
make anonymous payments. One analyst even referred to it a “Bitcoin killer.”
Bitcoin to Get the
‘Art’ Treatment in Sweden
While regulators around the globe are still scratching their
heads over how to regulate Bitcoin, count Sweden among those unlikely to
recognize it as a true currency. Instead, the largest Scandinavian economy is
expected to reject Bitcoin and other virtual currencies and instead give them
the same tax treatment it would give a piece of art.
Olof Wallin, an official at the Swedish Tax Agency, said in
with Bloomberg that true currencies
are traditionally tied to a central bank or geographic area. His agency, which
is drafting rules for virtual currencies and the programmers who generate them,
“view Bitcoins as what we call another asset—just like art or antiques,” he
Interpreting Bitcoin in this way would allow Sweden to
charge capital gains taxes on any transactions. It would fall under the same
asset class as art, antiques, jewelry and stamps.
Wallin added that Sweden is also considering taxing Bitcoin
miners as businesses.
Other Nordic countries are also trying to determine how to
regulate Bitcoin; Norway has labeled it a taxable asset, Finland plans to treat
it as a commodity and Denmark is drafting a proposal that aims to protect
consumers and businesses from losses.
Major U.S. Electronics Retailer TigerDirect to
announced Thursday that it has begun accepting Bitcoin as a method of payment
on more than 200,000 products.
said it is the first major U.S. electronics retailer to date to accept the
digital currency. TigerDirect spent several months reviewing the options for
processing Bitcoin, ultimately settling on BitPay to provide the means of
conducting Bitcoin payments on its website.
will not only accept the digital currency as payment, but will also sell the
computer components used to mine it. The retailer has partnered with AMD to
produce a large assortment of mining graphic cards from Sapphire, MSI,
VisionTek, Diamond and XFX.
individuals building their own high-powered PCs with parts offered on our site
to mine Bitcoins, it’s a logical fit,” said Steven Leeds, director of corporate
marketing for TigerDirect.
Customers will be able to utilize Bitcoin as
payment on both desktop and mobile websites. Bitcoin will not be accepted for
payment at any TigerDirect physical retail locations, however.