Australia: PayPal requests blockchain apps be regulated distinctly from Bitcoin payments

The company’s inquiry was first submitted to the Australian Senate in December 2014, insidebitcoins.com reports. Among requests for clear definitions, were recommendations that PayPal’s digital wallets be held separate from digital currencies and that blockchain-based applications should not fall under the same regulation as Bitcoin.

One of PayPal’s distinctions was that blockchain technology has potential far away from the Bitcoin financial payment structure. Applications such as MaidSafe and Storj utilise the blockchain to create solutions for problems companies and internet users are currently facing.

PayPal believes the blockchain companies that are formulating non-financial solutions should not be subject to the same regulation as the financial businesses of Bitcoin and other digital currencies. Blockchain applications, also known as bitcoin 2.0, utilise blockchain technology to create an entirely new system for data storage, centralised servers, identity ledgers and smart contracts and do not use these services for financial exchanges.

PayPal also wants the Australian Senate to draw a line between digital currencies and the companies that facilitate trades of digital currencies. PayPal believes that Bitcoin itself, as well as transactions between individual users, should not be regulated whereas exchanges should be.

PayPal prefers a registration and licensing process that is applied to companies providing financial services in digital currency, recommending the Australian Securities and Investments Commission to regulate such transactions in their country. These companies would also be subject to the Anti-Money Laundering and Counter Terrorist Financing Act.