Top 10 countries that greenlight crypto
A few years after bitcoin and altcoins had been invented, they were gladly used by a small community of crypto fans and aroused interest among advanced companies. Governments neglected a new digital currency and treated it as something worthless. Nevertheless, in the course of time, the popularity of digital tokens picked up steam rapidly. So, monetary authorities around the world had to acknowledge cryptocurrency and pondered hard over the appropriate legislation. First and foremost, they set out precise rules and regulations. Later, lawmakers came up with amendments to legalize the use of decentralized payment systems.
More interesting developments unfolded later. Several countries officially recognized crypto assets as legal securities. In this context, experts began speculating that other countries would follow suit and incorporate tokens into their economies soon. In this article, we will tell you about 10 countries that greenlighted the use of crypto at the government level.
1. Germany
The powerhouse in the EU was one of the first to regulate crypto at the legislative level and recognized it as a financial instrument. Germany’s central bank defined digital assets as private money that is allowed to settle transactions between banks and commercial firms. Every purchase paid by crypto is subject to a VAT, but cryptocurrency transactions are exempt from taxes.
Throughout Germany, the issuance of digital tokens, ownership, trading, and mining crypto are legal under the law.
2. Canada
This country is ranked second in the world in terms of the number of bitcoin ATMs scattered around its vast territory. Although bitcoin and altcoins are not acknowledged to be legal tender or authorized payment means in Canada, payments for merchandise and services in virtual money are carried out as a common procedure. Besides, every act of selling merchandise or service is subject to a VAT. On top of that, Canadian citizens have to file their returns from crypto investments to tax authorities.
3. Malta
Digital assets here are full-fledged financial instruments. Crypto services firms operate legally. Citizens are allowed to use digital tokens for payment transactions.
Malta's Ministry of Finance enacted a special law with provisions regulating crypto turnover. Interestingly, crypto assets circulating in the country are supervised by the Digital Innovation Authority, not by the central bank. The government made this decision to evade the conflict between crypto assets and fiat money.
4. Norway
Cryptocurrency was acknowledged in this Nordic country to be an official digital asset back in 2013. The government charges a tax for gains on selling tokens. Until 2017, this tax was akin to a VAT. However, later the government negated it for transactions with crypto tokens.
5. Singapore
The authorities of the city-state consider cryptocurrency a financial asset. Local companies buying and selling virtual currencies are charged a 7% tax. At the same time, long-term crypto investments of individuals are not subject to taxation.
Singapore's lawmakers managed to establish a flexible framework for the regulation of digital assets. Therefore, a great deal of large companies willingly registers under Singapore's jurisdiction. Cryptocurrencies are supervised by the local financial watchdog, the Monetary Authority of Singapore.
6. US
Crypto-related transactions have been legalized by the Securities and Exchange Commission (SEC) since 2015. They are taxed accordingly but the tax law is adopted by each state on its own.
Crypto users have to pay both a local and a federal tax on mining gains, crypto investments or the exchange of goods for tokens.
7. Czech Republic
It is one of few counties in Eastern Europe where cryptocurrencies are authorized. Interestingly, the central bank ruled that individuals and firms are not required to obtain a license for crypto transactions and are not charged any levies. The only requirement imposed by the Czech authorities is that owners of crypto exchanges, bitcoin ATMs, and firms exchanging crypto for fiat money should verify their clients.
8. Switzerland
This Alpine country brought up the issue of crypto regulation in 2013. However, the bill remained on the table. The appropriate legislation was adopted a few years later. In 2016, the authorities of Zug, one of the Swiss largest cities, began accepting bitcoin as a payment means for public services and utility bills.
Later on, digital currency was actively introduced into people's everyday life in other cantons. Despite the lack of clear-cut rules and regulations on digital money, Switzerland is one of the most popular countries to register blockchain startups and crypto firms.
Besides, individuals are allowed to make unlimited transactions with cryptocurrencies. They are exempt from VAT. Still, they have to obtain a license to carry out some transactions.
9. Sweden
Sweden's authorities recognize e-money as a payment means but the status is not validated officially. Returns from mining and selling crypto are subject to an income tax.
Financial regulators in Sweden authorized bitcoin ATMs and exchange transactions for retail traders. However, such operations should comply with the law against money laundering and funding terrorism.
10. Japan
In the spring of 2017, Japan's Parliament approved bitcoin and other cryptocurrencies as legal tender. At the same time, under Japan's law, virtual currencies are not akin to a full-fledged currency but can be used for shopping and service payments on a par with fiat money. A VAT is not charged for crypto transactions.
Crypto exchanges in Japan are registered with a government regulator and should hold a license.
