Poland: Bitcoin Is Not So Black As It Is Painted…

Last Updated: 24 January 2018
Article by Konrad Zacharzewski

Digital currency has been arousing a lot of interest for some time. In public administration circles - at least officially – so far, it has not been discussed very much. A few days ago though, the situation has changed. The National Bank of Poland together with The Polish Financial Supervision Authority (KNF) took a precedent position on the digital currency.

With one voice

A few days ago, the common view of the NPB and the KNF on digital currency was revealed. The document was prepared objectively. The "Announcement" clause is, in principle, a warning of risks, as evidenced by its preamble. It also refers in content to my pioneering publications devoted to bitcoin in Polish law, published almost three years ago. This is pleasant for me. And because of some knowledge of digital currency and the commitment to work on the regulatory taming of this phenomenon in the Polish legal realm, I am allowing myself to make a few comments.

Attention worthy is the whole "Announcement". This is the first official position on the digital currency, and in addition - which should be emphasized - edited jointly by the central bank and the central body of public administration. It can certainly influence the direction of legislative processes and the practice of economic life. It was, however, needlessly edited in a rather conservative tone, paying homage to an out-of-date terminology. We are dealing with digital currencies, and not, as they were called, with virtual "currencies". Such terminology (digital currencies) is now considered to be accepted and dominant. Virtuality does not associate well in this context. Digital currencies really exist.

It is really a warning?

As you read the content of the position, a conviction forms that the basic tone of the "Announcement from the National Bank of Poland and the Polish Financial Supervision Authority" on virtual "currencies" includes primarily descriptive and educational content. It may thus contribute to clarifying their legal nature and spectra of economic applications. It not so much warns about digital currencies but explains their main characteristics. These include, among others, decentralization of issuance and lack of legal status of redemption of obligations (private and public). Digital currency is not universally accepted by creditors nor is it an electronic money or a financial instrument.

That's all true. True is also the repeatedly expressed concern by the ECB and the EBA over digital currencies, and the fact that digital currency trading in Poland does not violate national or EU law, and that a fraudulent incident has occurred in one of the Polish bitcoin stock exchanges. It also does not hurt the realm of facts to present examples of risks associated with owning digital currency. It is true that the digital currency is, in certain circumstances, susceptible to computer anomalies (hacking interference, for example), and the person who owns it can be deceived in various ways. At present, the performance (rates) of digital currencies relative to the dominant world currencies are also characterized by significant volatility. It is also true that some forms of investing in digital currency offered may have the character of the so-called financial pyramid. In the latter case, the NPB and the KNF expressed themselves with a reasonable restraint, as the feature described can only be highlighted in some cases (in trace practices).

Through the lawyer's eye

When referring to the "Announcement" essentials, one has to pay attention to a few inaccuracies and to become aware of a few forward-looking themes. The definition of digital currency, as referred to in the "Announcement", is burdened with economic considerations. To a conservatively educated lawyer, the clarification of the phrase "virtual currencies are a digital representation of value" comes with great ease. The point here is that digital currency can be an asset. It is, therefore, a category which falls within the framework of the basic concepts of private law. A unit of a digital currency (e.g. bitcoin, litecoin, ethereum) has a legal status of property (art. 44 of the civil code). It can therefore be an asset. Therefore, it can be the subject of a disposal, that is to go from the seller to the buyer. It can be an element of inheritance, that is, go to successors. It can also be a non-cash contribution, that is, entering into the assets of a legal person. I have already mentioned all of this in scientific publications.

A unit of digital currency may also be "recognized by natural and legal persons as a means of payment". There is nothing disturbing about this. This feature of digital currency (as well as props such as collectables, amber, gold, etc.) is part of the content of art. 35811 § 2 of the civil code, if "the parties may stipulate in the contract that the amount of cash benefit shall be determined by other measure of value than money". In the context of private law, digital currency is a different measure of value than money. This is the core of its legal substance (design). As such, it can be used to redeem obligations between private legal persons.

This is not a defect, but a feature. Therefore, digital currency trading is legal. Most of the functions of digital currency derive from this code attribute (feature). Commonly, a unit of digital currency is money, since it can redeem obligations. However, it should be stressed that this is a function, not a public-law status, which interferes with the central conditions of the issue of money by the central bank. Digital currency in no way lies on the antipodes of the assumptions of the system of money creation formulated in the Constitution of the Republic of Poland.

It is, however, a means of redeeming obligations. In the same way fidget spinners, recently the most popular items of lust in certain circles, also have the status of money, since in exchange for a fidget spinner, one can get a collection of pokemon stickers. The fulfillment of such equivalent benefits also leads - as indicated by the results of the basic legal reasoning - to the redemption of obligation resulting from the exchange agreement (art. 603 of the civil code). Not only the payment by money may result in the redemption of obligation. This is the elementary message, known to the students of the university lecture on contract law. Digital currency is not money. That is certain. However, they perform the function of money, just as measures of value other than money. This is also certain.

What's before us?

The joint "Announcement" of the NPB and the KNF does not deserve a unilateral orthodox condemnation, although its leading tone due to the programmed warning character is slightly ominous. Beyond doubt, however, through its strong official voice, it enters the mainstream discussion on the location of digital currency in Polish law and in the Polish economic reality. That is why it is important to convey that the "Announcement" raises an incredibly significant issue in its final words. It mentions DLT (distributed ledger technology). It does it well. By omitting the warning precautionary plot in the "Announcement", this is certainly the most important element of the content of the commented submission.

It is true that the digital currency arouses some anxiety in the unacquainted people. The reasons are various, generally associated with the phenomenon of hiding pre-tax income. In the meantime, in practice, the most untaxed income is laundered with legal money. At present money laundering through digital currency, a prominent phenomenon due to its media attractiveness, is marginal. That is why, the positive inclusion of the most important issue, namely the DLT, included in the "Announcement", should be praised.

One has to agree with the thesis described in the "Announcement" that "distributed ledger technology can have a range of other uses, such as in the electronic databases, industry, services, or the financial sector. Many of the functional, operational and legal aspects of this technology should, however, be subject to a thorough and detailed analysis and testing, prior to its mass market introduction". From the perspective of future considerations this is the most significant part of the commented "Announcement". The importance of the distributed ledger technology can be overestimated and diminished only by those who do not know what is really going on.

Basic knowledge

Therefore, it will be sensible on this occasion to refer to the fruit of the works conducted under the protectorate of the Ministry of Digital Affairs of Poland under the program "From paper to digital Poland". A group of scientists and practitioners works pro bono under this program. I have participated in the "Blockchain Stream/DLT and Digital Currency" work from the beginning as a leader of the involved lawyers. We performed a number of documentary studies that are currently the most important resource for reliable knowledge of digital currency and DLT technology in Poland. All materials are easily available on the Internet.

This legacy primarily includes the "Overview of Polish law in the context of applications of distributed ledgers technologies and digital currency" from October 2016 (announced in January 2017 version), "Blockchain technology and cryptocurrency term lexicon" from October 2012 and "The canon of good practices of cryptocurrency market entities in Poland" from January 2017. I refer the persons interested in the essence of things to those documents. I think that these few papers constitute a starting point for forming an opinion on the officially mentioned subject in the joint "Announcement" of the NPB and the KNF.

Should we be afraid?

It is not my role to convince anyone to specific solutions because I have to admit that from the perspective of an academic-lawyer and a practitioner–lawyer, I have no influence on the direction of legislative activity and the practice of exercising public authority by public administration bodies. As a scientist I explain, and as a lawyer I solve problems. That is why, I strongly encourage all those concerned to diligently deepen their knowledge of digital currency and distributed ledger technology.

Bitcoin is not so black as it is painted... And that is why, a bit of a personal thread at the end. I have set up my first email account in 1996. In order to obtain it, I directed an application to the Head of the University's Information Technology Center, previously approved by the Dean of the Faculty of Law and Administration of my home University. Recognition of the application took two weeks. I have received a letter of approval about one month after the application has been accepted by registered mail, including the approval of the address and the login and password. And I could use the email. This is hard to believe today - email used to to cause concern...

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions