Following the Congressional Hearing that was held on digital currencies this Monday, the Senate Banking Committee has held their hearing on the topic as well.
7 senators from the Banking Committee have attended the hearing to help them fully grasp the concept of digital and virtual currencies, with Bitcoin taking the lead spot of the conversation.
If Monday’s hearing showed us that the US congress can recognize Bitcoin as a legitimate currency; Tuesday’s hearing was focused on understanding how it can be legislated. The questions that were asked of the attendees were mainly in regard to Bitcion’s growing use, tax collection, central banking, and its affiliation with criminal activity.
The hearing did show that the committee representatives are somewhat in the dark when it comes to digital currencies. Sen. Jerry Moran went to reddit, so he could educate himself more on the idea of digital currencies before the hearing, “I’m one of the senators attending today’s US Senate Banking Committee hearing related to bitcoin. What would you like me to know?” he posted on the Bitcoin board on redditThe issue of taxation came up with Sen. Heidi Heitkamp questioning how to tax digital currencies like Bitcoin, with its constant fluctuating, With Sen. Jeff Merkley even stating “Are bitcoin wallets … going to replace the Swiss bank account?”
When asked about how Bitcoin is used online, BitPay CEO Tony Gallippi replied “Credit cards were never designed for the Internet and credit card fees are discriminatory, the highest fees are paid by the smallest businesses. If you are a business owner, it is your fault that you took a stolen credit card, even if the bank approved it. Bitcoin is a cheaper, faster, and more secure payment system, with no discrimination against smaller businesses.”
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The discussion then shifted to the legality and criminal use of digital currencies. The conclusion to which most agreed to was that criminals will take advantage of any new technology that has a monetary value, and Bitcoin cannot be labeled as a criminal currency due to that.
While the hearing did not bring any new legislations or regulations regarding Bitcoin, it did bring more recognition to its place in the economy. With China, and Europe becoming more accepting of Bitcoin, and the nature of questions asked, a notion that the US feels left behind when it comes to digital currencies was prominent.
Photo courtesy of Wikipedia