The U.S. has become the first country to ban virtual currencies, with the Treasury Department saying it will ban “virtual currency” trading on March 15, with some of its other restrictions including prohibiting “the transfer or use of bitcoins or other virtual currencies” in all U.N. designated conflict zones.
Bitcoin is a digital currency that’s based on cryptography that’s difficult to trace.
Unlike traditional currencies, Bitcoins can’t be bought and sold in stores, unlike traditional currencies.
They’re traded in an online marketplace, and unlike traditional financial products, they’re not regulated by governments.
A ban on virtual currencies would affect the U.K. and the Netherlands as well, as well as some countries in the European Union.
In a letter sent Monday to the U!
Treasury Department, the European Central Bank said it was concerned that “virtual currencies are being used as a means of anonymous payment for illicit activities.”
“These virtual currencies have not been authorised by any central bank or financial authority, nor have they been subjected to any formal scrutiny and oversight,” the ECB said.
“As a result, they have become a vehicle for criminals and terrorist financing, and have become tools for cybercrime, money laundering and money laundering operations.”
The ECB said the virtual currencies could be used to launder money and evade taxes.
Bitcoin, a virtual currency, is based on a software program, not a physical object, and the currency can’t legally be converted into cash.
The U!s Treasury said it planned to introduce new regulations in the next three months that will ban the virtual currency trade and the use of bitcoin.
Bitcoin, which has soared since its 2009 debut, has gained in popularity as investors have become more cautious about holding the currency.
Its price rose more than 500% last year to about $1,200 an ounce.