Cyprus Mail

Bank troubles boost bitcoin utility, say marketers

By Elias Hazou

BITCOIN marketers Neo & Bee said yesterday they welcome regulation of their business and look forward to more dialogue on the crypto-currency.

The Cyprus-based company was responding to a fresh warning issued by authorities on Tuesday concerning the potential dangers associated with virtual currencies, such as hacking, insolvency of bitcoin exchanges, outright theft and money laundering.

“Businesses that operate with bitcoin should be regulated under a sober and equally innovative framework, perhaps even under a new regulatory body,” Neo & Bee said in a statement.

“Money can be stolen from any wallet, physical or digital, including bank accounts, credit cards, vaults, safes, mattresses and by trusting the wrong person,” the company noted.

“Bitcoin is extremely unlikely to go to zero, whereas the euro is designed to decrease in value every year, as per the initial design of Keynes. Also, as long as Bitcoin has utility, it will have value. As long as the banking system fails to provide honest services, Bitcoin will have utility and thus value.”

It added: “Cash is by far the safest and most anonymous way to complete monetary transactions for nefarious reasons, as repeatedly proven by convicted criminals around the world, who do not go to jail because they are ‘systemic’ and therefore too-big-to-jail. Systemic risks do not exist in bitcoin, and that’s why failed businesses should and must die so that the healthy ones can move on, and not take the wealth of a country and its future with it.”

Neo & Bee also took a swipe at an MP of the House commerce committee, which on Tuesday held a discussion on bitcoin with the company and financial regulators.

“A parliamentary representative that first heard about Bitcoin two days prior noted to the University of Nicosia (UNic) that it was ‘strange’ that they decided to accept bitcoin payments, without any other university in the world having done the same. The University of Cumbria, a public UK university, followed UNic in January.”

Lack of knowledge about a subject should not stand in the way of innovation, the company said.

According to the Central Bank here, bitcoin is not legal tender, but at the same time trading in the virtual currency is not illegal.

Bitcoin is classed neither as a currency nor a financial instrument, and is consequently completely unregulated. Cypriot authorities appear baffled over the new technology, and are waiting on the European Union for guidance.

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