Bitcoin does not meet the definition of a currency or even an electronic payment form in Finland, where the central bank has instead decided to categorise the software as a commodity.

“Considering the definition of an official currency as set out in law, it’s not that. It’s also not a payment instrument, because the law stipulates that a payment instrument must have an issuer responsible for its operation,” Paeivi Heikkinen, the head of oversight at the Bank of Finland in Helsinki, said in an interview last week. “At this stage it’s more comparable to a commodity.”

Finland is the latest country to try to come to grips with the advent of virtual currencies that are not controlled by any central bank or government.

As regulators in Europe warn of the risks associated with using such software as a substitute for real money, authorities are struggling to design frameworks to protect consumers and businesses from potential losses they have no legal means of recouping.

In the Nordic region, Norway’s government has also decided Bitcoin does not qualify as a currency. Globally, Bitcoin has had a mixed reception, with China’s central bank banning lenders from handling the virtual money.

The US Internal Revenue Service has not offered guidance on Bitcoin beyond saying it was working on the issue and that it had been monitoring digital currencies and transactions since 2007. – Bloomberg