Jason Simon explores how certain European countries are regulating cryptocurrencies –

The German Federal Ministry of Finance, with support of Germany’s Bundesbank, has determined that digital currency is not a real currency. It asserts, incorrectly, that cryptocurrency doesn’t fulfill the typical functions of currency, which it has already been proven to do. However, until Germany recognizes Bitcoin and others as part of the country’s national monetary system, it cannot be considered a valid currency.

As cryptocurrencies continue to receive more attention around the world. Many countries have begun to address their status from a legal and regulatory standpoint. While most developed countries have been more accessible to the ecosystem, a few have still not been able to determine how best to address the framework that will allow digital currency to continue to progress. Jason Simon is a FinTech and cryptocurrency expert that follows developments in the space, especially as they pertain to regulations. He has already provided a general overview of how the European Union (EU) is approaching the subject and now takes a closer look at a few of the countries in the EU that are creating their own frameworks

Germany, with a very robust economy, is often seen as a world leader when it comes to the implementation of new regulations. However, in terms of digital currency, it hasn’t been completely willing to acknowledge its importance. The German Federal Financial Supervisory Authority BaFin) qualifies virtual currencies/cryptocurrencies as units of account and, therefore, financial instruments, not currency. Simon asserts, “The German Federal Ministry of Finance, with support of Germany’s Bundesbank, has determined that digital currency is not a real currency. It asserts, incorrectly, that cryptocurrency doesn’t fulfill the typical functions of currency, which it has already been proven to do. However, until Germany recognizes Bitcoin and others as part of the country’s national monetary system, it cannot be considered a valid currency.”

Italy has been somewhat more flexible with its approach to cryptocurrencies. It has several pieces of legislation in place that address issues such as taxation and legal use, but has not gone so far as to consider digital currency a legitimate currency on the same level as the euro. It does, however, consider it to be a currency on the level of other currencies, such as the former lira. Italy is also now reviewing several bills that target anonymity in an effort to ensure the use of digital currency can meet requirements established by international governing bodies on the subject of money laundering and anti-terrorism funding.

Luxembourg is another EU country that has been open to cryptocurrency. Explains Simon, “Luxembourg appeared to be ready to embrace Bitcoin as soon as it was introduced and has welcomed many entities in the digital currency space. In June 2017, Pierre Gramegna, the Minister of Finance of Luxembourg, recognized before Parliament that cryptocurrencies are actual currencies because ‘they are accepted as a means of payment for goods and services by a sufficiently large circle of people,’ as he put it. He also stated that there was currently no regulation from a monetary perspective regarding cryptocurrencies, but added that cryptocurrency dealers in the country are bound by the same rules as any other financial service providers with regards to the fight against money laundering and terrorism financing. Gramegna, in 2018, stated that cryptocurrencies and blockchain technology were both an ‘unavoidable phenomenon that brings added value and efficient services to consumers.’”

In Spain, cryptocurrencies have been somewhat welcomed, but there is still no official framework on them as a currency. However, legislation exists to prevent their use in conjunction with money laundering and terrorism financing, as well as tax implications. New legislation is being drafted that is said to be “friendly” to the ecosystem. That legislation is expected to contain tax breaks for certain blockchain companies in order to attract more of the technology sector to the country.

France’s government has begun to work on a legal framework covering cryptocurrency and digital assets with the goal of becoming a pioneering and key player in the ecosystem on an international level. Two recent studies, one commissioned by the Minister of the Economy and Finance and the other by the National Assembly, offer detailed analyses of cryptocurrencies in the country and made several policy proposals. Both reports agree on the importance of establishing rules that will provide clarity and security while, at the same time, allowing a great amount of flexibility so that the cryptocurrency sector can mature through experimentation.

About Jason Simon

Jason Simon is a FinTech and digital payments expert who became involved in cryptocurrencies when they were first introduced. He enthusiastically follows what is happening in the evolving world of finance, excited about the prospects digital currencies offer global consumerism. When he’s not involved in helping advance the digital payments space, he enjoys spending time with his family and improving his community.

Jason Simon weighs in on how PayPal is helping shape the future of currency

PayPal was one of the first major, private payment solutions that was able to establish itself around the world. It was a slow road to get to where it is today, but the past year has seen an explosive amount of new support for the platform everywhere. Going forward, it is expected that there will be even faster adoption of digital payment solutions and digital commerce platforms.

For more than a decade, there has been a steady increase in the popularity of digital solutions – digital shopping, digital services, even digital television. In general, the world has been shifting to favor a digital-based paradigm, but the progress has been slow. However, due primarily to the COVID-19 pandemic, there has been unprecedented acceleration. Jason Simon, a FinTech and eCommerce expert, discusses how the transition is advancing and what is expected over the next few years.

The global pandemic has inarguably changed how consumers view the purchase-making process for all goods and services. This can be seen in the increase in digital consumer platforms that have begun to populate the Internet, but one of the biggest indicators is the performance seen by PayPal over the past year. PayPal President and CEO Dan Schulman took part in an interview for CNN recently and the growth the company has been witnessing shows how impactful digital operations are.

Asserts Simon, “PayPal was one of the first major, private payment solutions that was able to establish itself around the world. It was a slow road to get to where it is today, but the past year has seen an explosive amount of new support for the platform everywhere. Going forward, it is expected that there will be even faster adoption of digital payment solutions and digital commerce platforms.”

PayPal has record growth during COVID-19 while, at the same time, it has been busy helping small businesses through loans and grants. Over the past six months, the platform has onboarded 10% of its total number of merchants, adding 35 million new merchants and consumers in the period. Consumerism is moving toward digital and the eCommerce acceleration that had been expected to take place within 3-5 years took place in less than six months.

In the latter half of 2020, there was 25% growth in digital small business revenue. This was the only segment to report an improvement, as land-based small business revenue continued to fall. Additionally, 75% of digital small business sales outside the business’ home state as more merchants and entrepreneurs began to adopt digital alternatives to keep their operations afloat.

Adds Simon, “Digital is going to be the new normal. Digital trends that were already taking place have accelerated and, even after COVID-19 restrictions are removed, there is going to continue to be more emphasis placed on digital alternatives. It has become the new norm and business executives and commercial analysts everywhere agree that eCommerce is going to take priority moving forward.”

The financial services space is going digital, as well. According to surveys, up to 70% of consumers now favor digital currency over traditional solutions. Asserts Simon, “Paper money is slowly going away and digital currency is going to take over, in one form or another. This could be through cryptocurrencies, such as Bitcoin or Ether, or it could be through other forms of electronic money. However, the end result is the same. Digital money, just like digital shopping, will be the future.”

About Jason Simon

Jason Simon is a FinTech and digital payments expert who became involved in cryptocurrencies when they were first introduced. He enthusiastically follows what is happening in the evolving world of finance, excited about the prospects digital currencies offer global consumerism. When he’s not involved in helping advance the digital payments space, he enjoys spending time with his family and improving his community.

 

Jason Simon discusses the impact of Jack Dorsey’s Twitter post sale and NFTs

The fact that Dorsey would choose an NFT for the auction is no coincidence.  As a consummate pioneer and with a solid global following, he has just brought NFTs and the blockchain to the forefront.  Achieving this level of awareness and acceptance, using traditional means, would have taken years or decades.

There is never a shortage of events or actions that change the course of everyday life, but some have a larger impact than others.  The introduction of Twitter in 2006 was one of these, and Twitter co-founder Jack Dorsey welcomed the world to the new social media platform with a simple tweet in March of that year that read, “just setting up my twttr.”  Things have certainly changed significantly since then and Dorsey has now decided to put the tweet up for auction.  He has gone the route of using a non-fungible token (NFT) and Jason Simon, a FinTech and cryptocurrency expert, explains why this auction is of great importance.  

Just like the creation of Twitter itself, auctioning off the first-ever tweet through an NFT is big news. NFTs are unique digital certificates that provide a permanent record of who owns online media, capitalizing on the value of the blockchain to create an indelible, immutable transaction that is secure and which cannot be altered.  Asserts Simon, “The fact that Dorsey would choose an NFT for the auction is no coincidence.  As a consummate pioneer and with a solid global following, he has just brought NFTs and the blockchain to the forefront.  Achieving this level of awareness and acceptance, using traditional means, would have taken years or decades.”

The auction is listed on the Valuable by Cent marketplace that was introduced three months ago.  It has already become hugely popular in bidding wars and its current highest bid stands at $2.5 million.  The world’s first tweet is on track to be purchased by Hakan Estavi, the CEO of Bridge Oracle and a dedicated cryptocurrency enthusiast.  According to the Valuable by Cent website, “Owning any digital content can be a financial investment [that can] hold sentimental value. Like an autograph on a baseball card, the NFT itself is the creator’s autograph on the content, making it scarce, unique, and valuable.”

Dorsey’s tweet was first put on sale in December but didn’t gain traction until Dorsey tweeted about it last week.  Initially, bidding was extremely slow, but his promotion of it resulted in bids almost immediately reaching $88,000 before jumping to $1.5 million and then $2 million within hours.  Adds Simon, “This reaction shows how people value digital media and how important it is to ensure proper certification of intellectual property.  There are other solutions that have been created to provide this service, but only the blockchain can create a permanent, universally-accepted record that cannot be altered.  This gives it much more power and creates better confidence on the part of consumers.”

The blockchain was created to provide several solutions that previously were unavailable.  It acts as a distributed ledger that is stored across multiple nodes simultaneously, ensuring that records are not centralized and prone to being manipulated.  Because there is no centralized control, there is no possibility of the data being compromised and, with the added benefit of cryptography, there is a heavy layer of security that transcends borders, languages and governments.”

NFTs are all unique; no two are mutually interchangeable.  They are a way to create digital ownership and asset interoperability across multiple platforms, ensuring that digital property can be labeled, bought, sold and tracked to provide proof of authenticity and ownership at all times.  One of the most notable uses of NFTs is the NBA TopShot collectible, which was introduced early in 2020 by Dapper Labs in collaboration with the league.  It offers collectibles and tradables from the league and, as of last month, had over $230 million in gross sales.  

About Jason Simon

Jason Simon is a FinTech and digital payments expert who became involved in cryptocurrencies when they were first introduced.  He enthusiastically follows what is happening in the evolving world of finance, excited about the prospects digital currencies offer global consumerism.  When he’s not involved in helping advance the digital payments space, he enjoys spending time with his family and improving his community.