Cryptocurrency case law list

This is page is periodically updated. It contains a list of EU and UK case law and opinions that relate to digital or crypto-currencies.

EU Law

 

Proposal for a DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Directive (EU) 2015/849 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing and amending Directive 2009/101/EC

Link here.

[G]aps still exist in the oversight of the many financial means used by terrorists, from cash and trade in cultural artefacts [sic.] to virtual currencies and anonymous pre-paid cards. This proposal seeks to address those gaps…

 

Snippets

it is appropriate to define as obliged entities under the 4AMLD all gatekeepers that control access to virtual currencies, in particular exchange platforms and wallet providers.

Last update: 21 December 2017:Austria is strongly concerned that the current text does not enhance transparency on beneficial ownership necessary to avoid the abuse of trusts for the purpose of money laundering and terrorist financing. There is a clear need to establish mandatory central and public beneficial owner registries for trusts in the Member State.

Commentary

The EU’s approach is to extend the list of obliged entities to virtual currency exchanges and wallet providers. This would bring them into the ambit of the Fourth Money Laundering Directive.

What about Peer to Peer purchasing and exchange below 10000 Euros that utilises a non-EU Wallet?

 

EU Case Law

Case C-264/14; Judgment of the Court (Fifth Chamber) of 22 October 2015;
Skatteverket v David Hedqvist

  1. Questions: The exchange of virtual currency [in this case bitcoin] for traditional currency and vice versa. Does it constitute the supply of a service effected for consideration under Article 2(1)(c) [transactions that are subject to VAT] of the VAT Directive.
  2. If so, must Article 135(1) [Exemptions] be interpreted as meaning that the above mentioned exchange transactions are tax exempt?

Key points:

  • Bitcoin, as well as traditional currencies,  cannot be considered ‘tangible property’ within the meaning of Article 14 of the VAT Directive. Hence, no supply of goods.
  • Exchange of traditional currency for units of the ‘bitcoin’ virtual currency and vice versa constitute the supply of services.
  • The ‘bitcoin’ virtual currency, being a contractual means of payment, cannot be regarded as a current account or a deposit account, a payment or a transfer. Hence not exempt under Article 135(1)(d).
  • Transactions involving non-traditional currencies [e.g. Bitcoin] are financial transactions.
  • Hence the Article 135(1)(e) exemption applies.

Link here.