The Federal Financial Supervisory Authority (BaFin) of Germany has officially defined cryptocurrencies as financial instruments.
According to BaFin’s document published on 2.3.2020, cryptocurrencies are now classified as the “digital representations of value” that have the following characteristics:
- Not issued or guaranteed by any central bank or public body;
- Don’t have the legal status of currency or money;
- Can be used by individuals or legal entities as a means of exchange or payment;
- Serve investment purposes;
- Can be transmitted, stored and traded electronically.
The document also notes that cryptocurrencies are not to be confused with various types of “electronic money” which have other sections of the law dedicated to them.
Specifically, are not cryptocurrencies:
– a monetary value that a) meets the requirements of payment systems in limited networks or with a very limited range of products and instruments for social or tax purposes or b) is used only for payment transactions related to payment transactions for electronic communication networks / services.
BaFin also clarified that, cryptocurrencies did not fall into any of the generally recognized pre-existing categories in Germany.
The BaFin Document ist available here (in german)