Stateless Virtual Money in the Tax System

53 Eur. Taxn. 7 (2013), Journals IBFD

6 Pages Posted: 2 Sep 2013 Last revised: 19 May 2014

See all articles by Aleksandra Bal

Aleksandra Bal

International Bureau for Fiscal Documentation (IBFD)

Date Written: June 1, 2013


Money has been affected by technological developments, especially by the widespread use of e-commerce and the emergence of virtual worlds. Stateless digital currencies have emerged and raised a series of legal questions, especially in the area of taxation. The challenge, for the tax administration, is how to approach a system that is outside the traditional streams of commerce and finance and for users to understand the tax consequences of their transactions in virtual currencies. This paper begins with a basic primer on the essential characteristics of digital money: what it is and how it operates. Next, it discusses two prominent virtual currency schemes: Bitcoin and virtual world money. Its main purpose is to give an overview of the tax implications one should consider when exchanging virtual currencies. As those problems cannot be addressed in a one-size-fits-all manner, the focus is here on two exemplary countries: Germany and the United States. Finally, the article concludes with some remarks on future developments.

Keywords: virtual worlds, virtual money, virtual currency, digital money, Bitcoin

JEL Classification: K34

Suggested Citation

Bal, Aleksandra, Stateless Virtual Money in the Tax System (June 1, 2013). 53 Eur. Taxn. 7 (2013), Journals IBFD, Available at SSRN:

Aleksandra Bal (Contact Author)

International Bureau for Fiscal Documentation (IBFD) ( email )

Rietlandpark 301
Amsterdam, 1019 DW

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Abstract Views
PlumX Metrics