Pro bitcoin union
If he's worried about fintech upstarts or bitcoin offering a high-tech alternative to Western Union's bread-and-butter business of money transfer, Chief Information Officer David Thompson doesn't let on. Thompson, formerly the Pro bitcoin union of Oracle, Symantec and PeopleSoft, offers a cogent case for the payment giant's ability to innovate and stay relevant as interest in blockchain-based and even digital currency payments escalates. To that pro bitcoin union, Western Union recently invested in Digital Currency Group, an investment firm pro bitcoin union on bitcoin and blockchain startups.
The upshot of a recent interview with Thompson is that he feels the costs of scaling a payments business, and the barriers to entry created by regulatory regimes, are steep. It will be harder than many assume for challengers to undercut established players like Western Union and their pricesyet the established players have to stay abreast of technological changes and modernize their services.
Time will tell how well companies like Western Union adapted to change, and how safe their positions really were. Some think bitcoin could be a cheaper way to send money around the world. Has that position softened? That allows a firm that specializes in this space to pro bitcoin union us insight into firms that potentially could be a partnership for us, a technology we might want to leverage, a market we might want to be entering.
Clearly there's a lot of dialogue in the industry and the press about digital currency, and much of that talk has shifted to a discussion of blockchain and not necessarily the digital currency itself. We anticipated that shift because with digital currency, when you really think about it, until you have an ecosystem where you can use that value, there's not a lot of value to the individual user or consumer. I personally mine bitcoins to understand the technology and the ecosystem, that's my interest pro bitcoin union a technologist.
The only person I can pay with bitcoins is the guy who maintains my sprinklers. I can't go to Whole Foods and buy my groceries with bitcoin. I do see promise with blockchain in the sense that that open ledger is really good for potential record reporting of documents and smart contracts.
There are many governments looking at blockchain as a way to do birth certificates or titles, a smart pro bitcoin union in which certain terms are triggered and then it registers itself on the blockchain. I think the public blockchain is difficult to do financial transactions with. If you take Western Union, JPMorgan Chase and Wells Fargo, we're public companies, and if our transactions were all pro bitcoin union, looking at them pro bitcoin union potentially enable someone to produce our revenue projections before we can.
I think you'll see more closed-loop blockchain usages for financial services. That's something we're working with DCG and getting their perspective on. We're a heavily regulated entity, we operate in more than countries and territories, and we have a lot of regulatory scrutiny.
So any movement into new things requires due diligence, requires dialogue with regulators. You do have a partnership with Ripple, which uses blockchain protocols to automate international payments. How is that going? We have a pilot in place with Ripple, where we're looking at Ripple for intercompany settlements and cross-border settlements.
Ripple is a capability where correspondent pro bitcoin union could be disrupted. We're just looking at it as a way to streamline our settlement process. We do have a robust capability for settlement through countries, technology we've built for ourselves. I'm always open to ideas of using open source capabilities or off-the-shelf technologies.
I don't know if there's business value in it or not. We're still at that pilot stage. There are a number of blockchain-type companies that are trying to offer their own international payments service — TransferWise, WorldRemit and a number of others. What's your attitude toward those disruptors? As a company, we're going to have competition, because this is a very robust market — there's high demand from customers for cross-border payments and remittances.
TransferWise, PayPal [which recently bought Xoom] and some of these other firms have focused initially on domestic money transfer.
As soon as you cross a border, the barriers to entry are significantly higher because of the regulatory requirements, the licensing requirements, and the anti-money-laundering, fraud and risk mitigation you have to put in place. We're a dominant player in the digital money transfer space, pro bitcoin union we'll continue to build and innovate. There are people who say the cost of international remittances has to go down, especially for migrant workers sending money back home.
Does Western Union have a take on that? We're one of the most competitive from a pricing perspective. In many corridors from a fee perspective we're free. One thing that's omitted from a lot of folks who discuss this topic is they're not looking at a compliance solution. There's a lot of people who pro bitcoin union to put in technologies that will do things faster, but they miss the point that you have to have an AML program in place, you have to have fraud and risk management in place, you have to have consumer protection processes in place.
The second you put that infrastructure in place, your costs associated with that service internally go up. Even services out there that say they're going to disrupt the world and this is going to be free, pro bitcoin union they start figuring out the requirements mandated by regulators, it quickly becomes intolerable. And many of the firms you'll see in this space are not profitable. They're burning through a lot of pro bitcoin union from venture capital.
You said you're leading a digital transformation at Western Union — what are some of the changes you've made and plan to make? We've had a bill pay transformation team of about people based in San Francisco for more than four years. That team has built a robust digital platform based on Hadoop technology, a big data capability that allows us to in real time look across billions of rows of data, looking for fraud and risk patterns and general compliance infractions.
Pro bitcoin union process 31 transactions per second and we apply 1, compliance and risk rules to every transaction. The capability also allows us to provide streamlined know-your-customer processes for consumers, so they can have as little friction as possible.
Our mobile app is among the highest rated in the app stores. These tools allowed us to pro bitcoin union the largest digital money transfer company. We made an announcement in Q4 of last year of a new product called WU Connect. We've built a set of APIs that allows our cross-border money transfer capabilities to be embedded into social media applications and messaging applications. We have signed contracts with WeChat and Viber where they have embedded our money transfer product into their applications.
So if you downloaded Viber now, you could do a money transfer across borders in that. They're trying to make their apps sticky so consumers stay with them. The cross-border remittance pro bitcoin union very social, whether it's a mother to her son or a husband to his wife, so we're finding customers are very attracted to this capability.
Many of our retail agents are banks and postal services. You're starting to see many of those banks very interested in doing P2P money transfers in their mobile applications. You'll pro bitcoin union many banking partners taking on this capability. Do you ever worry about the risk of cyberattack to the payments system? And has Western Union added any special security layers to its network? Do I stay awake at pro bitcoin union worrying about cybersecurity?
It is one of my top concerns as a technologist responsible for our technology platforms. We spend a significant amount of time, energy and resources on cybersecurity at Western Union. That's important because we operate in so many different remote locations. Our board and shareholders are interested in making sure we have resources allocated to cybersecurity.
We also invest in third-party firms that evaluate our capabilities to ensure if we have a weak link, we strengthen it. Pro bitcoin union have invested significant resources in denial of pro bitcoin union attack mitigation.
We've also put in what we call defense-in-depth capabilities in our infrastructure — multiple layers of protection. That's a real critical point in financial services. We've connected to many intelligence agencies and law enforcement organizations around the globe, and we are plugged into those threat notices so we can be prepared. We also pro bitcoin union watch our insiders — through background checks, through technologies that watch employee and contractor behaviors — and we also have separations of duties for certain tasks.
Editor at Large Penny Crosman welcomes feedback pro bitcoin union penny. Partner Insights Sponsor Pro bitcoin union From: Comment Start the Conversation, Login. Like what you see? Make sure you're getting it all Independent and authoritative analysis and perspective for the banking industry.
Back to Index of Legal Reports. This report surveys forty foreign jurisdictions and the European Union, reporting on any regulations or statements from central banks or government offices on the handling of bitcoins as well as any significant use of bitcoins in business transactions. Of those countries surveyed, only a very few, notably China and Brazil, have specific regulations applicable to bitcoin use.
Overall, the findings of this report reveal that the pro bitcoin union over how to deal with this new virtual currency is still in its infancy. However, journalists have reportedly obtained documents indicating that Alderney is trying to take the lead and become the central hub for the bitcoin, by minting and issuing physical bitcoins and creating an international center with a bitcoin storage vault service that complies with anti-money laundering rules.
Under the National Constitution of Argentina [3] the only authority capable of issuing legal currency is the Central Bank. Therefore, they may be considered money but not legal currency, since they are not a mandatory means of pro bitcoin union debts or obligations. Although bitcoins are not specifically regulated, they are increasingly being used in Pro bitcoin union, a country that has strict control over foreign currencies.
According to the guidance paper and draft rulings, Bitcoin transactions will be treated "like barter transactions with similar taxation consequences. Additional information on this topic is available. The Belgian Finance Minister, in response to a question by a Belgian senator, stated in July that while the Bitcoin system seems to be somewhat problematic as a potential tool for money laundering and other illegal activities, such problems should not be overstated.
He also stated that, based on studies from the Belgian central bank Banque nationale de Belgique and the European Central Bank, the bitcoin does not present any significant risks to price stability, to the financial system in general, or to its pro bitcoin union users. Finally, in this same statement, the Minister of Finance indicated that government intervention with regard to the Bitcoin system does not appear necessary at the present time.
On October 9,Brazil enacted Law No. Article 11 determines that the penalties provided for in the legislation applicable to financial institutions applies to the infractions set forth in Law No. Canada does not have pro bitcoin union specific law or regulation that regulates bitcoins.
Nevertheless, these payment systems should be designed and operated to meet the needs of Canadians which would include convenience and ease of use, price, reliability, safety, and effective redress mechanisms. On February 11,the Canadian Finance Pro bitcoin union unveiled the Federal Budget forwhich included a brief mention of Canadian government pro bitcoin union to introduce anti-money laundering and anti-terrorist financing regulations for virtual currencies such as Bitcoin.
The new law will treat virtual currencies, including Bitcoin, as "money service businesses" for the purposes of the anti-money laundering law. According to news reports, there are no merchants that accept bitcoins in Chile as of yet. Buying virtual currencies in Chile is still very cumbersome. Interest in acquiring bitcoins is slowly growing. However, because there pro bitcoin union no regulation on the use of bitcoins, transactions are informal in nature and mainly conducted among friends.
On December 3,the central bank of China and pro bitcoin union other central government ministries and commissions jointly issued the Notice on Precautions Against the Risks of Bitcoins. Banks and payment institutions in China are prohibited from dealing in bitcoins.
The Notice further required strengthening the oversight of Internet websites providing bitcoin registration, trading, and other services. It pro bitcoin union warned about the risks of using the Bitcoin system for money laundering.
On December 6,the Croatian National Bank CNB reportedly conducted a pro bitcoin union on the circulation of digital currencies pro bitcoin union concluded that the bitcoin pro bitcoin union not illegal in Croatia: According to the same report. The use of bitcoins is not regulated in Cyprus. However, the Danish Tax Authority has not published any comment as to whether Bitcoin earnings should be taxed.
On March 18,the Danish Central Bank issued a statement declaring that Bitcoin is not a currency. According to the statement, "Bitcoin does not have any real trading value compared to gold and silver, and thus is more similar to glass beads.
The Pro bitcoin union Central Bank went on to point out that Bitcoins are not protected by any national laws or guarantees, such pro bitcoin union a deposit guarantee.
On April 1the Tax Authority published a binding reply in which it declared that an invoice cannot be issued in Bitcoins, but must instead pro bitcoin union issued pro bitcoin union Danish Kroner or another recognized currency.
The Authority went on to state that any losses in Bitcoins cannot be deducted as a cost of doing business. In Estonia, the use of bitcoins is not regulated or otherwise controlled by the government. On December 19,the Pro bitcoin union business information Web portal Dv. Nymmel said that according to Bank of Estonia estimates, the bitcoin does not create any threat to financial or price stability because of its limited virtual area of circulation.
In MarchPro bitcoin union Tax Authority defined the official government position that Bitcoin is an alternative means of payment and income derived from Bitcoin transactions constitutes capital gain subject to taxation. The European Union EU has passed no specific legislation relative to the status of the bitcoin as a currency.
In Octoberthe European Central Bank issued a report on virtual currency schemes that discusses the Bitcoin system and briefly analyzes its legal status under existing EU legislation.
On December 13,the European Banking Authority EBAthe regulatory agency of the EU responsible for advising EU institutions on banking, e-money regulation, and payments, issued a warning on the dangers associated with transactions, such as buying, holding, or pro bitcoin union virtual currencies.
The EBA pointed out that since the bitcoin is not regulated, consumers are not protected and are at risk of losing their money and that consumers may still be liable for taxes when using virtual currencies. The Finish Tax Authority, Vero Skatt, has issued instructions for the taxation of virtual currencies, including the bitcoin.
When transferred to another currency, the rules pro bitcoin union taxation of capital gains apply. When the currency is used as a form of payment for goods and services, it is treated as a trade, and the increase in pro bitcoin union that the currency might have gained after it was obtained is taxable. A court decision that is mentioned in the Banque de France report found that a company that acted as an exchange for bitcoins should be considered a payment service provider, subject to oversight from the French Prudential Supervisory Authority.
Accordingly, bitcoins are units that are not expressed in the form of legal tender. Instead, they are units of value that have the function of private means of payment within private trading exchanges, or they are substitute currencies that are used as a means of payment in multilateral trading transactions on the basis of pro bitcoin union agreements of private law.
However, licensing could become necessary under various circumstances, such as the creation or maintenance of a market in bitcoins. The tax treatment of bitcoins has been discussed in some statements by the Federal Ministry of Finance. Among the opinions voiced by the Ministry is a statement on the possibility of value-added tax liability for bitcoin transfers, the lack of income tax effects for the underlying transaction when bitcoins are used as a means of payment, and the lack of long-term capital gains liability for bitcoins that are held pro bitcoin union longer than one year.
No specific legislation on bitcoins exists in Greece, nor has the National Bank of Greece issued any statement pro bitcoin union bitcoins. A private company has listed a few businesses that accept bitcoins as a form of payment, however. However, our existing laws such as the Organised and Serious Crimes Ordinance provide sanctions against unlawful acts involving bitcoins, such as fraud or money laundering.
On March 19, the Central Bank of Iceland issued a statement explaining the legal status of digital coins in Iceland. The coins are not a recognized and protected currency, and purchasing them may violate the Icelandic Foreign Exchange Act, which specifies that Icelandic currency cannot leave the country. Additional information on the topic is available. There appears to be no explicit legal framework that regulates, restricts, or bans bitcoins in India.
It is not regulated by the central bank so there are risks. On February 6,Bank Indonesia issued pro bitcoin union statement on bitcoin and other virtual currencies. The Central Bank of Ireland has not published a statement on its website regarding bitcoins. The Revenue Commissioners in Ireland are monitoring the development of the bitcoin and considering its implications for possible taxation, with the most likely areas of taxation being in the taxation of any gains, as well as value-added tax, which is a charge on goods and services.
According to media reports, officials from pro bitcoin union Ministry of Justice and Bank of Israel have been conducting discussions on the implications of using bitcoins, particularly in illicit transactions. An incident of an alleged attempted extortion involving a request for payment in bitcoins was reported on December 19, At least three Israeli banks have received emails from an unknown individual threatening pro bitcoin union release the personal details of millions of their customers unless the payment was made.
On October 29,the European Central Bank published a report titled Virtual Currency Schemes[75] which studies relevant economic and legal aspects of the Pro bitcoin union system. A European Directive of regulates the use of electronic currencies including the bitcoin with the aim of harmonizing payment methods, increasing competition, and facilitating market access.
The Decree allows the use of pro bitcoin union currencies in accordance pro bitcoin union the EU Directive at the level of the European Central Bank, and by the central banks of European Members, the Italian public administration at the regional and local government levels, and the Italian postal system. However, the use of electronic currency is restricted to banks and electronic pro bitcoin union institutions—that is, private legal entities duly authorized and registered by the Central Bank of Italy.
Aside from these developments, Italy does not regulate bitcoin use by private individuals, and currently the implementation of initiatives concerning the use of electronic currencies lies with the EU. There are at present no laws in Japan regulating the use of bitcoins. Pro bitcoin union amendment to the Payment Services Act pro bitcoin union virtual currency exchanges regulation.
Virtual currency exchanges pro bitcoin union in Japan will be required to register with the Financial Services Agency. The amendment will be effective by pro bitcoin union June in Bank Negara Malaysia officials apparently met with local bitcoin proponents in November to learn more about the currency.
The Central Bank does not regulate the operations of Bitcoin. The public is therefore advised to be cautious of the risks associated with the usage pro bitcoin union such digital currency. Malta currently does not have any regulations specifically pertaining to bitcoins, nor does there appear to be any official government statement on the recognition or policy towards the bitcoin. In October pro bitcoin union, a Maltese company launched the first bitcoin hedge fund.
Virtual currencies such as bitcoins currently do not fall within the scope of the Act on Financial Supervision Wet op het financieel toezicht of the Netherlands, as the Dutch Minister of Finance, Jeroen Dijsselbloem, recently emphasized. He emphasized that currently, despite the watchful eye of government authorities on the future development of virtual currencies, in principle the consumer is solely responsible for their use.
The Dutch Central Bank De Nederlandsche Bank, DNB recently called attention to the risks posed by the purchase of virtual currencies, including bitcoins and litecoins, [91] and warned consumers to be wary.
Nevertheless, Dutch regulators have not imposed licensing restrictions on virtual currency businesses. On May 14,a district court in a decision in a civil suit involving pro bitcoin union uncompleted Bitcoin transaction between two parties, ruled that Bitcoin, like gold, is a medium of exchange that is an acceptable form of payment in the country but that pro bitcoin union be defined as legal tender, common money, or electronic money.
Pro bitcoin union, the Reserve Bank has no direct power over any form of alternative payments medium. Who knows at this point? There is still a lot for the world to pro bitcoin union on this issue. It appears that Nicaragua has not yet promulgated any legislation regulating bitcoins, nor has the Central Bank of Nicaragua issued any rulings or guidelines on the subject. However, news reports indicate that bitcoins are being used in the country. Simon is reportedly interested in promoting the use of bitcoins in Nicaragua and advanced some pro bitcoin union related to their use.
The Norwegian Tax Authority has issued a principle statement that bitcoins will be treated as capital property, at least for tax-related purposes. Capital property legislation allows for deductions for losses and taxes on winnings. Although travel currencies are exempted from the capital gains tax, bitcoins are not as the bitcoin and other virtual currencies are not recognized as travel currencies.
The use of the bitcoin in Poland is not regulated by a legal act at present. On December 21,the Russian website Coinspot. Wozniak was more certain about the taxation of bitcoin transactions. He said that all types of income must be taxed under Polish law, and the law makes no distinction among the types of payments used to conduct transactions, including bitcoin payments.
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