After remaining quiet on the issue for quite some time, the Canadian government has now come out and confirmed that it does not view bitcoin (BTC) as legal tender. Officials say the federal government and the Bank of Canada will continue to monitor developments over the rising popularity of bitcoin and other digital currencies.
“Only Canadian bank notes and coins are recognized as legal tender in Canada,” wrote a Department of Finance official in a statement to the Wall Street Journal. “Bitcoin digital ‘currency’ is not legal tender in Canada.”
Financial Transactions and Reports Analysis Centre of Canada, the regulator that licenses Canadian-operated foreign exchange businesses, refused to comment on bitcoins.
Alexandre Deslongchamps, spokesperson for the central bank, explained that threats to financial stability would be the leading prompter for the government to increase its interest in the cryptocurrency industry.
“Smaller, stand-alone payment systems for which there are many substitutes – like bitcoin — should generally require much less intensive oversight and regulation because they pose much less risk to the Canadian financial system as a whole,” Deslongchamps told the news publication. “Nevertheless, these payment systems should be designed and operated to meet the needs of Canadians which would include convenience and ease of use, price, reliability, safety, and effective redress mechanisms.”
In the past, when asked about bitcoins, the Canada Revenue Agency (CRA) would refer to a statement posted on its website. It states that digital currencies are subjected to taxes and can be traded like other commodities.
It was reported earlier this month that a bitcoin ATM was launched in Toronto. Another bitcoin machine was established in Vancouver late last year.
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