Cryptocurrencies have been attracting the attention of investors, entrepreneurs and governments around the world for several years. Their popularity continues to grow, and many countries are making decisions on how to regulate the use of digital assets on their territory. Some states have fully legalized cryptocurrencies, others have introduced partial restrictions, and still others have chosen the path of a complete ban. In this article, we will look at where cryptocurrency is allowed and which countries support the use of digital assets.
1. USA
The United States of America is one of the leading countries in the field of cryptocurrencies and blockchain technologies. In the United States, cryptocurrencies are recognized as legitimate assets, and their use is regulated at the federal and state levels. Although regulation may vary by state, the government’s overall position is to support innovation in the crypto industry.
Cryptocurrencies in the United States are treated as property for tax purposes, and income from trading them is subject to taxation. The Securities and Exchange Commission (SEC) actively monitors the cryptocurrency market and issues recommendations and rules regarding the issuance and trading of digital assets.
In addition, the United States is one of the largest markets for crypto exchanges and blockchain-related companies, which makes the country an important center for the development of the crypto industry.
2. Canada
Canada is also among the countries where cryptocurrencies are legalized and supported. The Canadian government treats cryptocurrencies as commodities, and transactions with them are subject to capital gains tax. At the same time, the country is actively developing blockchain technologies and creating favorable conditions for the work of cryptocurrency companies.
Canadian authorities have introduced regulation of crypto exchanges and service providers related to digital assets, requiring them to comply with anti-money laundering (AML) and customer identification (KYC) standards. This makes Canada one of the most transparent and secure jurisdictions for conducting cryptocurrency business.
3. Switzerland
Switzerland is known for its loyal attitude towards cryptocurrencies and is one of the most digitally asset-friendly states in the world. Projects related to blockchain and cryptocurrencies are actively developing in the country, especially in the Zug region, also known as “Cryptodolina”.
Switzerland allows the use of cryptocurrencies as a means of payment and recognizes them as legitimate assets. The country’s authorities are actively working to create favorable conditions for the cryptocurrency business, including the introduction of innovative legal norms such as the “Law on the Distributed Registry”.
Due to its progressive position, Switzerland has become an important international hub for cryptocurrency startups, funds and investors.
4. Japan
Japan is one of the first countries to officially recognize bitcoin and other cryptocurrencies as legal means of payment. In 2017, Japan passed a law regulating the use of cryptocurrencies and their exchange for fiat money. Since then, the country has remained one of the most open and friendly to digital assets jurisdictions.
The Japanese Financial Services Agency (FSA) strictly regulates crypto exchanges and companies related to cryptocurrencies, requiring them to comply with security and consumer protection standards. This has made Japan one of the safest and most transparent markets for trading cryptocurrencies.
Thanks to progressive legislation, Japan attracts a large number of cryptocurrency projects and actively develops blockchain technologies in various sectors of the economy.
5. Singapore
Singapore is one of the leaders in financial technology and innovation, and cryptocurrencies are no exception. The country has clear and transparent rules governing the use and trading of digital assets.
Cryptocurrencies in Singapore are not considered a legitimate means of payment, but are recognized as a commodity, and their use is regulated by local law. In 2020, the Payment Services Act came into force in the country, which regulates the operation of cryptocurrency exchanges and digital payment service providers.
Singapore actively supports the development of blockchain technologies and cryptocurrency projects, providing favorable conditions for business and innovation. This makes the country one of the leading crypto centers in Asia.
6. Germany
Germany is one of the few European countries where cryptocurrencies are officially recognized as legitimate financial instruments. In 2013, the German Federal Financial Administration (BaFin) recognized bitcoin and other digital assets as “private money”, which allowed them to be used as a medium of exchange and an investment tool.
Cryptocurrencies in Germany are subject to capital gains tax, and all transactions with them are regulated in accordance with national legislation. In 2020, Germany also passed a law allowing traditional banks to provide services for storing and trading cryptocurrencies, which opened up new opportunities for investors and companies.
Germany is actively developing the ecosystem of blockchain technologies and attracting cryptocurrency startups, creating favorable conditions for their work.
7. Estonia
Estonia has become one of the first countries in the world to introduce e-government and actively use blockchain technologies in government. Cryptocurrencies are recognized as legitimate assets in Estonia, and their use is regulated by local legislation.
Estonia has introduced requirements for compliance with AML and KYC standards for crypto exchanges and companies related to digital assets. This has made the country one of the most transparent and secure jurisdictions for conducting cryptocurrency business in Europe.
Due to its progressive position and developed digital infrastructure, Estonia attracts many cryptocurrency projects and startups.
8. Australia
Australia recognized cryptocurrencies as legitimate assets back in 2017. Since then, the country has been actively supporting the development of the cryptocurrency market and blockchain technologies. Cryptocurrencies in Australia are treated as property, and all transactions with them are subject to taxation.
The Australian authorities have imposed strict requirements on crypto exchanges and service providers related to digital assets, including compliance with AML and KYC standards. This has made Australia one of the most regulated and secure jurisdictions for running a cryptocurrency business.
Australia is actively developing blockchain technologies in various sectors of the economy, including finance, agriculture and healthcare, making it one of the leading crypto centers in the region.
9. Malta
Malta, known as the “Blockchain Island”, became one of the first countries in the world to implement comprehensive legislation regulating cryptocurrencies and blockchain technologies. In 2018, Malta adopted a series of laws aimed at creating a favorable legal environment for the cryptocurrency business.
Cryptocurrencies in Malta are recognized as legitimate assets, and their use is supported by the state. The country is actively attracting cryptocurrency projects and startups, offering them favorable working conditions, including low taxes and a simple registration procedure.
Thanks to its progressive legislation, Malta has become an important international hub for cryptocurrency business and blockchain technology innovation.
10. Dubai (UAE)
The United Arab Emirates, and in particular Dubai, actively supports the development of cryptocurrencies and blockchain technologies. In 2021, Dubai created a regulatory body responsible for overseeing cryptocurrency companies and projects within the special economic zone.
Dubai attracts many cryptocurrency projects due to its progressive approach to regulation and its desire to become the world’s leading center of blockchain innovation. Cryptocurrencies in Dubai are recognized as legitimate assets, and their use is regulated by local law.
Dubai is actively developing an ecosystem of blockchain technologies, which makes it one of the leading crypto centers in the Middle East.