The Department of Banking and Securities (DoBS) with the state of Pennsylvania has said that local cryptocurrency exchanges don’t need to be licensed under the Money Transmission Business Licensing Law.
Cryptocurrency is Not “Money”
According to a memorandum called Money Transmitter Act Guidance for Virtual Currency Businesses, the DoBS with the state of Pennsylvania doesn’t consider cryptocurrencies to fit the definition of money under the Money Transmitter Act (MTA).
… Thus, only fiat currency, or currency issued by the United States government, is “money” in Pennsylvania. Virtual currency, including Bitcoin, is not considered “money” under the MTA. To date, no jurisdiction in the United States has designated virtual currency as legal tender. – Reads the document.
Because cryptocurrencies don’t fit the lawful definition of money, cryptocurrency exchanges are not money transmitters, hence there is no need for a special license which is otherwise required under the Money Transmission Business Licensing Law.
By doing this, Pennsylvania joins the ranks of other states such as Texas, where cryptocurrencies are also not defined as money.
Is it a Currency?
The regulatory debate of whether Bitcoin and other cryptocurrencies can be considered currency is one that’s been held for quite some time.
It seems that different legislators have approaches fitting their currently existing regulatory framework. The Securities and Exchange Commission, for instance, considers most of the ICO-issued tokens to be securities. However, the Commission holds that Bitcoin (BTC) and Ether (ETH) are not securities.
The IRS, on the other hand, considers virtual currencies to be currencies. However, it also taxes them as property, which does seem convenient for the tax watchdog.
What do you think of the Government’s position on cryptocurrencies? Let us know down below!
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