The recent study from the Federal Reserve Bank of Minneapolis has stirred the pot, suggesting Bitcoin might be a thorn in the side of government fiscal policies. The researchers propose a bold solution: slap a hefty tax on Bitcoin or outright ban it.
According to them, Bitcoin creates serious challenges for governments, particularly when maintaining a “permanent primary deficit” – a situation where government spending always exceeds its revenue without factoring in interest payments on debt.
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In their paper, the researchers claim that Bitcoin, being a decentralized digital currency, competes with government-issued securities, making it harder for governments to manage their finances.
“A legal prohibition against Bitcoin can restore unique implementation of permanent primary deficits and so can a tax on Bitcoin,” …
Full story available on Benzinga.com