Challenges in regulating digital currencies include:

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REVISTA CHILENA DE DERECHO Y TECNOLOGÍA C E N T R O D E E S T U D I O S E N D E R E C H O I N F O R M ÁT I CO • U N I V E R S I DA D D E C H I L E ISSN 0719-2584 • VOL. 5 NÚM. 2 (2016) • PÁGS. 173-209 • DOI 10.5354/0719-2584.2016.43541

The Digital Currency Challenge for the Regulatory Regime

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[ABSTRACT Digital currencies pose several questions. First, finding the best definition. Digital currencies have specific features that make necessary to mention in its definition. The second puzzle that they present is the function of Internet. It is important because Internet is the vehicle for the good functioning of digital currency schemes. The network provides all the facilities to digital currency, but it also may be a place for criminal activity. The third question is the relation of digital currencies and the e-commerce. The electronic commerce is an antecedent of virtual currencies. The necessity to make the payment quicker and easier makes possible the growth of virtual currencies. Finally, there is the puzzle of the regulation. A complete regulation does not exist in the digital area. It is the nature of the Internet. It is a place where there are no financial rules. Criminal activity and improper use of Internet will increase over time.]

[There are some puzzles in digital currency matter. First, finding the best definition. Digital currencies have specific features that make necessary to mention in its definition. The second puzzle is the function of Internet. It is important because Internet is the vehicle for the good functioning of digital currency schemes. The network provides all the facilities to digital currency, but it also may be a place for criminal activity. The third puzzle is the relation of digital currencies and the e-commerce. The electronic commerce is an antecedent of virtual currencies. The necessity to make the payment quicker and easier makes possible the growth of virtual currencies. Finally, there is the puzzle of the regulation. A complete regulation does not exist in the digital area. It is the nature of the Internet. It is a place where there are no financial rules. Criminal activity and improper use of Internet will increase over time. In response to the question whether people should use digital currency we will say that there is not a clear answer. It will depend on the preferences of the users. Definitely, the best example of a digital currency scheme is Bitcoin. This virtual currency is experimental. Bitcoin never will replace the fiat currency or printed money. In the same way, the high use of digital currency will depend of the purposes of the agreement. As in all of the private transactions, the parties will agree to the terms and conditions. Then, the payment method reflects the decision of the parties. The buyers and sellers will take into account that a high level of privacy will be a high level of risk and less protection from the authority, at least for now.]