Cryptocurrency has been a controversial topic ever since its existence. It has been widely criticised for its volatility, and its impact on the environment and is even referred to as a ‘Ponzi scheme’ by top economists. However, some countries still believe in the decentralisation power of cryptos such as El Salvador, which made Bitcoin a legal tender in September 2021, followed now by the Central African Republic in April this year.
The legal status of cryptos varies from country to country. Here we list all the top countries that made cryptos legal, illegal or unregulated (with some restrictions).
In 2018, Algeria passed a financial law—making all crypto transactions illegal. This includes holding and trading any digital assets. Any violation of the law is subjected to an offence and is punishable.
In 2014, Bolivia made crypto illegal. The Bolivian Central Bank issued a resolution that banned cryptos, instead of rug pull cases and scams which cost investors a fortune. According to the Bolivian government, cryptocurrencies should not be trusted as an investment.
Best of Express Premium
China’s central bank in September 2021, made all cryptocurrency-related transactions illegal and put a blanket ban, sending the strongest signal yet of its determination to crack down on the industry.
All cryptocurrencies, including Bitcoin and Tether, are not fiat currency and cannot be circulated on the market, the People’s Bank of China said on its website. “All crypto-related transactions, including services provided by offshore exchanges to domestic residents, are illicit financial activities, “the PBOC said in the statement.
Cuba is the latest country to authorise and regulate cryptocurrencies like Bitcoin.
Egypt has classified cryptocurrencies such as Bitcoin as prohibited under Islamic law. Dar al-Ifta, the country’s primary Islamic advisory body, issued a religious decree in 2018.
The country 2020, tightened banking laws in September 2020 to prevent trading or promoting cryptos without a Central Bank licence.
The European Union has not made the usage of cryptos legal or illegal. It recognises Bitcoin and other digital assets as ‘crypto-assets’.
Meanwhile, European Union (EU) lawmakers are tightening rules on cryptocurrency transfer, in the view of the rising use of crypto-assets for money laundering. According to Reuters, the new proposal will make it mandatory for cryptocurrency companies such as exchanges operating across the EU to obtain, hold, and submit information on any of their users involved in any transfers.
The proposals aim to extend the anti-money laundering requirement (AML), a rule already applicable in the conventional payment space. This would make it necessary for crypto exchanges to report to the authorities if any transaction above EUR 1,000 ($1100) takes place.
In 2018, Indonesia’s central bank issued new regulations banning the use of cryptocurrencies, including Bitcoin, as a means of payment.
The crypto industry in Iran is not regulated, the Central Bank of Iran (CBI) in April 2021 authorized domestic banks and money exchangers to use locally and licensed mined cryptocurrencies to pay for imports to the sanctioned nation.
The country has a very ‘love-hate’ relationship with crypto. Iran announced a four-month ban on the energy-consuming mining of cryptocurrencies such as Bitcoin after cities suffered unplanned outages due to massive crypto-mining operations held in the country.
Notably, around 4.5 per cent of the world’s Bitcoin mining takes place in Iran, which, according to blockchain analytics firm Elliptic.
The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021 is yet to be tabled by the government. The Bill seeks to prohibit all private cryptocurrencies in India, however, “it allows for certain exceptions to promote the underlying technology of cryptocurrency and its uses,” the document reads.
India has levied a 30 per cent tax on crypto investors, and a 1 per cent TDS on every crypto intra-traders. Currently, India has not regulated cryptos but won’t legalise it as well.
The country is “fairly ready” with its consultation paper on cryptocurrencies and has consulted domestic as well as institutional stakeholders including the World Bank and the International Monetary Fund, said Economic Affairs Secretary Ajay Seth.
In January 2022, Russia’s central bank proposed banning the use and mining of cryptocurrencies on Russian territory, citing threats to financial stability, citizens’ well-being and its monetary policy sovereignty.
The move is the latest in a global cryptocurrency crackdown as governments from Asia to the United States worry that privately operated and highly volatile digital currencies could undermine their control of financial and monetary systems.
Russia has argued for years against cryptocurrencies, saying they could be used in money laundering or to finance terrorism. However, Russia’s leaders are using cryptocurrency to bypass the sanctions imposed by the US and its allies after Russia’s invasion of Ukraine, said Blockchain analytics firm Elliptic. The research firm has tracked down a Russian crypto wallet which has ‘significant asset holdings’.
In April 2021, the Central Bank of the Republic of Turkey issued a regulation banning the use of cryptocurrencies in every form— directly or indirectly.
The United States
Cryptocurrencies are legal in the US. According to the U.S. Department of Treasury’s Financial Crimes Enforcement Network (FinCEN), Bitcoin is a convertible currency with an equivalent value to real currency or one that can act as a substitute for real currency. The Internal Revenue Service has also categorized Bitcoin as property for taxation purposes.
Credit: Source link