- German MP Joana Cotar proposes Bitcoin legal tender legislation.
- Germany is not generally considered a pro-crypto jurisdiction.
- Cotar sees Bitcoin as a better alternative to CBDCs.
El Salvador made history as the first country to recognize Bitcoin as legal tender in 2021. This groundbreaking move catalyzed the imagination of what national adoption could look like. Not to be outdone, the Central African Republic followed suit in 2022, although it reversed course around a year later in March 2023 by legislating for “economic agents” to be free to choose crypto as payment.
Now, in a stunning development, Bitcoin’s legitimacy as a monetary medium could reach new heights through an unlikely champion, Germany, with Member of Parliament Joana Cotar recently revealing her plans to push Bitcoin legal tender legislation in Europe’s industrial powerhouse.
Bitcoin as Legal Tender in Germany
The seed for this disruptive proposal was planted when Cotar openly declared her support for recognizing Bitcoin as a legal tender in Germany. Cotar seeks to spearhead a “preliminary examination” to formulate a legal framework that would formally endorse Bitcoin in this regard. Her stated goal is to balance prudent regulation while upholding the liberating aspects of decentralized money.
In a bid to offset the fears that surround cryptocurrency, Cotar emphasized the need for “legal security for companies and citizens” in integrating Bitcoin. This addresses the potential risks like money laundering and tax evasion that are often associated with crypto. However, Cotar is adamant about not stifling the innovation or freedom that makes Bitcoin so revolutionary.
Furthermore, Cotar’s “Bitcoin in the Bundestag” initiative aims to advance Bitcoin literacy and gather proposal support by educating her fellow legislators on the benefits of BTC. While it’s still early days, Cotar’s plans represent a major milestone in Bitcoin’s integration with legacy finance
Cotar Not a Fan of CBDCs
Bitcoin’s integration into legacy finance has been gaining momentum over the years. Alongside El Salvador’s adoption and the Securities Exchange Commission recognizing it as a commodity, Cotar’s initiative adds further legitimacy to Bitcoin by recognizing benefits such as having no single point of failure, permissionless remittances, and the freedom that comes with decentralized money.
Cotar believes that Bitcoin’s decentralized design is a better alternative to a digital euro central bank digital currency (CBDC). In support of this view, she cited concerns over financial privacy and excessive government overreach that are often associated with CBDCs.
This view is in stark contrast to the Bank for International Settlements, which advocates for CBDCs on the basis of offering price stability and infrastructure resilience, among other factors.
On the Flipside
- Cotar’s proposal has set the stage for a showdown between Bitcoin and CBDCs.
- German lawmakers are generally wary about cryptocurrencies, including recently legislating against BTC as payment for property.
- The legal tender proposal faces challenges in gaining majority support in the Bundestag and passing legislation.
Why This Matters
If Germany, the world’s fourth-largest economy, recognizes Bitcoin as a legal tender, the knock-on effect would change regulatory perspectives worldwide, lending further legitimacy to cryptocurrency as a viable financial system.
Learn more about Germany’s growing legislative crypto landscape here:
Commerzbank Secures Crypto Custody License in Germany
Find out about Ethereum’s brush with bankruptcy during the early stages of its development here:
Recordings of Ethereum’s 2015 Crisis Reveal Naïve Idealism