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Now that bitcoin has been recognized as a medium of exchange, rather than a commodity subject to certain taxation in Japan, is it the only such one other than the Yen?

Since the pronouncement of course falls far short of declaring bitcoin legal tender, does it in effect mean anything other than it is now legal to operate an exchange?

Edit: I reworded the original question, as I had incorrectly equated the terms "form of payment" and "medium of exchange".

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  • Where this recognition is published?? There no such thing axept in some crypto news website !! Do you have any official source? – Badr Bellaj May 3 '17 at 11:27
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    LMGTFY: cnbc.com/2017/04/12/… – Tom Russell May 3 '17 at 17:27
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TL;DR: Bitcoin has been declared a legal form of payment which is not the same as an official currency.

I think that it may not be clear what a "legal form of payment" means and how this differs from the official currency of a country.

"Currency" usually refers to a form of money issued by a government, which makes "cryptocurrency" a misnomer to some degree.
Currencies generally have a high level of protection and status in their country, for example the nation requires the taxes to be paid in terms of the currency and usually requires its population to accept the currency as a means of payment. However, first and foremost the currency defines the unit of account that is being predominantly used in the country.

Yet, nations recognize a number of different ways to settle obligations explicitly which are sometimes called "legal forms of payment". These may be different forms of transferring the nation's currency, but can also be other forms of money. For example, if you are using a form of money that the nation has not recognized as legal form of payment, in the case of legal dispute it may first need to be established whether the payment was valid in the first place, and if the payment is not recognized as such, the value may be lost.

Some examples of legal forms of payment are cash, money orders, checks, and wire transfers, and in most countries also digital payment networks such as PayPal. Although uncommon, payments settled in foreign currency will also be recognized. In some regions around the world there are local currencies that aim to encourage commerce in their region. Often these regional currencies are tied to the national currency, but given out at a discount, e.g. the Reka-checks can be bought by employees in Switzerland for 3-20% less than their face value but only used to pay for tourism services in Switzerland.

To my understanding, what happened in Japan a few days ago was the recognition of Bitcoin as a legal form of payment. This does not give Bitcoin a special status, except that value transfers performed with Bitcoin are now explicitly recognized as payments in Japan. Similar things have happened in the past, e.g. when Germany declared that Bitcoin would be treated alike to a complementary currency, or (IIRC) Belgium declared that it would treated like foreign currency.

An overview of the current legal status of Bitcoin in the world can be found on Coin Dance.

Note: I'm neither a lawyer, nor an economist.

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  • Was it illegal to pay for something in bitcoin before the government's announcement? – Tom Russell May 4 '17 at 17:13
  • I edited my question to reflect this astute if rather unkind answer. It didn't address the gist of my question. – Tom Russell May 4 '17 at 17:36
  • @TomRussell: It was unregulated, but probably not illegal. Now it is explicitly legal to use. Legal forms of payment in Japan are likely to be some subset of cash, credit cards, checks, wire transfers, online payment services like PayPal– and now Bitcoin. – Murch May 4 '17 at 18:41
  • You've gotta be yanking my blockchain. – Tom Russell May 4 '17 at 21:17
  • It seems to me that you were expecting something very different. It's it possible that you were thinking of legal tender instead of legal form of payment? Perhaps, I don't understand your question correctly. In that case could you please clarify what you were expecting to get more information on? – Murch May 4 '17 at 22:34

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