Land of Vikings: Crypto War Is Brewing?

In Norway, an unknown person threatened to blow up three mining-firms for making much noise, which affects the inhabitants of the surrounding villages. Then the authorities of the Vikings’ Country decided to solve the problem with crypto miners in their own way. The reason was that 2 entrepreneurs had paid only $8.7 thousand of taxes for 34 bitcoins (more than $280 thousand). Currently the story is about the tax controls tightening and, probably, the introducing of a new tax regime for companies working with digital assets. It seems that a war against the digital financial industry is about to break out in the Scandinavian state.

After the Breivik’s case, one should take the threats of ordinary Norwegians seriously. Just in case. Moreover, the attitude to the cryptocurrency and digital economy in Scandinavian countries was the most enthusiastic at the beginning.

About a year ago the Central Bank of Norway was considering the possibility of a full transition to a digital currency! The idea was as follows: All individual crypto accounts of the residents had to be stored in the Central Bank and be linked to bank cards or smartphone applications. All social payments should have been assessed on them, such as: pensions, child allowances, compensations and even salaries of state employees. The financial regulator explained this by the fact that the residents of the country were less likely to use cash and it would have been a good idea to make the electronic financial turnover cheaper.

In neighboring Sweden, the authorities considered the introduction of the crypto krone. The token was supposed to be based on the state distribution register. The Central Bank of Sweden made the statement, which said that the introduction of a crypto krone would not create “serious obstacles” for the country’s monetary system.

A similar project was announced in Denmark. Iceland also put its digital coin in requisition. Out of a sudden everything calmed down. Why has the attitude been changed from extremely positive to extremely negative?

There is no need to go far to answer this question. The Scandinavian social fairy tale is based on two aspects: the state’s role in the economy and the giant tax rates.

The state sector occupies a dominant position in the financial and industrial sphere of the Nordic countries. Everybody knows the largest Scandinavian brands - Nokia, IKEA, Volvo, SAAB, Bofors. But their influence ends where the interests of the social state begin. The GDP of Norway is by 44% of the tax revenue. Of Sweden - by 46%, Finland - by 40%, Denmark - by 49%. For comparison, the share of tax revenues in the US GDP is 24%. This money goes to the state budget and provides a quiet, comfortable life for most residents. The tradition that the rich pay for the poor is also a characteristic of Scandinavia. The marginal tax rate on personal income is: in Norway - 48%, in Sweden - 57%, in Denmark - 55%, in Finland - 49%. Astonishing figures.

And here there are cryptocurrencies, mining, blockchain ... Their very nature contradicts the state control because the crypto economy is based on the idea of the individuals’ consensus  and lack of influence from authority and business. Almost all the projects of the crypto nationalization had failed before they began. The exception is El Petro. But Venezuela simply has no way out due to the inflation rate of 1,000,000%.

Scandinavian socialism also formed a special attitude to taxes. The residents voluntary pay almost half of their incomes to the budget being sure that the money will be used to meet their social needs. And miners do not want to pay.

"The responsibility for paying taxes from the cryptocurrency lies on every resident, but miners and traders are in no hurry to give money to the state, - said Astrid TWETER, a representative of the Norwegian Tax Administration. - A person who bought or sold cryptocurrency assets like bitcoin or other coins should point this in the tax report. In case of the cryptocurrency, the tax administration does not receive an automatic message from a third party that the resident has performed transactions with digital money".  She also added that the tax service would use the information about exchange trades and various control methods to track the value of digital assets.

But we must realize that this is nothing more than words. The tax inspector able to catch a cryptocurrency businessman or a company for the concealment of incomes or their undervaluation has not been born yet in the whole world. And the increased tax control over legal crypto exchanges will only lead to the fact that coins will leave civilized trades for the shadow market.

In the Scandinavian countries something is happening to the cryptocurrencies, what the Marxist-Leninist theorists talked about behind the scenes about:  the conflict between socialism and communism is inevitable. Scandinavian socialism is putting pressure on crypto-communism.