Erratic Banks Make Using Bitcoin Unpredictable

Erratic Banks Make Using Bitcoin Unpredictable

[heading]Erratic Banks Make Using Bitcoin Unpredictable[/heading]

 

Regulators, authorities and bank management have shown their hand when it comes to Bitcoin: they are nervous about what the future might hold.The North American Securities Administrators Association on Tuesday added two technology-related issues to its annual list of top investor threats, which join risks such as oil and gas drilling and real estate investment schemes.

The organization stated that digital currencies, like Bitcoin, offer consumers a new way of paying for goods and services, but they also create a “fertile ground for scam artists to capitalize on…(their) increasing popularity and acceptance.”

Because digital currencies are highly volatile and the concept is difficult for even sophisticated investors, they pose a risk, according to the organization.

The perception of Bitcoin risk are diverse and cover all facets of the financial world.

Stories of banks shutting down Bitcoin users’ accounts run rampant. And they continue today, perhaps at quicker speeds than ever before. An even more dramatic example happened recently to a bitcoiner living abroad in Germany.  This particular user had purchased bitcoins while living outside of Germany more than one year ago.

Now the user is in the market for a home with the bitcoins he purchased. When he began selling his Bitcoin to Mt. Gox and BitStamp, the money hit the users’ account, and the user was flagged.

“2 policemen came to my home and asked me to come to to the station to discuss my activity… as well as freezing my bank account (with the money I need to pay for the house). So, a few days ago I went into the station to discuss with them how I invested, what the charges were about (from localbitcoins) and I had to show them when and how much I invested in bitcoins originally and how many I currently own. I am now hoping that my bank account will be unfrozen in the next few days as according the police, everything went pretty well but it still up to the judge to make a decision on my case.”

Even though Germany has called Bitcoin “legal tender”, it appears still that its use can flag bank account holders. This is very much the experience in the US and Canada, despite different stated policies. It seems, when it comes to bitcoins, the banks make the laws.

Although this users account was unfrozen by a judge, his experience represents a warning for everyone looking to involve themselves in Bitcoin. Until erratic banks make using Bitcoin a normalized and predictable practice, they will merely push people away from their services, quickening the process towards a decentralized economy.

 

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.