The regulatory vacuum surrounding cryptocurrencies such as Bitcoin is harming their mainstream adoption, according to a number of Taylor Wessing partners.

Yesterday the UK Government called on the cryptocurrency community for advice on dealing with virtual currencies, as they investigate scope for Britain to support these new formats. Financial services in New York have also suggested introducing a 'bitlicense' in order to try to introduce some constraints on the process.

However, currencies such as Bitcoin will not gain widespread acceptance until EU legislation creates a single market standard to enhance trust and accessibility.

"The world is going digital: countries are looking at the imposition of 'internet' taxes and we already store many of our documents in the cloud and access money through our phones. Although this may seem complicated, we use these technologies readily enough in our everyday life. What consumers and merchants want is for transactions to be cost efficient, easy, accessible and secure and this is what legislators should be looking to provide. We suggest this will be addressed through EU legislation to create a single market standard across the EU to enhance trust and accessibility". Christine Flion and Stefania Grosso, Taylor Wessing, Brussels

"While a regulatory vacuum meant that the world of virtual currencies emerged rapidly, in our view this vacuum is now harmful to the ability of virtual currency derived benefits to go mainstream. The trick for regulators and participants will be to identify those aspects of virtual currencies that are 'better than' and those aspects that are 'worse than' and regulate accordingly. What seems to be interesting some is the idea of a single digital ledger of our respective funds, allowing rapid inter-person transfer and moving the book keeping away from the bank system." Jonathan Rogers, Taylor Wessing, London                                                                                                                                                                  

"The mood of the German regulator currently is to include "virtual currencies" into their scope of supervision. As the timing to implement PSD II is too tight to address regulations on virtual currencies, a regulatory framework for the EU can only be expected at a later point in time." Stefan Feckl, Taylor Wessing, Frankfurt

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