VAT Treatment of Cryptocurrencies – Some Thoughts on the Libra Project

Abstract

On 18 June 2019, Mark Zuckerberg officially announced the Libra project with a popular post on Facebook. The idea of launching a global stablecoin that would benefit from an easily accessible and globally available financial infrastructure was born. Based on the blockchain system, Libra would distinguish itself from other popular cryptocurrencies (like bitcoins) for being collateralized (and therefore “stable”) and for its creation process. In this article, the author will first briefly describe the Libra project and make some observations about Libra by analysing its functioning and determining whether it is a fully stablecoin or not. She will then examine the issue from the point of view of VAT, which could possibly be taken into account on transactions made using Libra.