The growing popularity of Bitcoin as a currency has brought the attention of many governments all around the world to regulate the currency. Some ended up making it illegal whilst some loved the idea. Here are seven countries that love Bitcoin (in no particular order):
US is one of the countries with the largest Bitcoin trading volume in the world. Ever since Bitcoin has been introduced, the country has adopted a positive stance towards it; although, some state governments – New York for example – have put regulations into force. Bitcoin is classified as a money services business (MSB) by the US Department of Treasury’s Financial Crimes Enforcement Network (FinCEN), and has also made it to the US derivatives markets.
From 1 July 2017, Australia started treating Bitcoin “just like money”, and therefore it will no longer be subject to double taxation. Just recently, in order to strengthen the Anti-Money Laundering and Counter-Terrorism Financing Act, the government has also announced a bill that will regulate digital currency exchanges including bitcoin exchanges for the first time.
Bitcoin in Canada is classified as a commodity, so “any resulting gains or losses could be taxable income or capital for the taxpayer”. Bitcoin transactions can also be considered barter transactions when digital currency is used to pay for goods or services. Furthermore, Bitcoin exchanges in Canada are required to register with Financial Transactions and Reports Analysis Centre (FINTRAC) and are also expected to be regulated under anti-money laundering and counter-terrorist financing laws.
Canada has also been one of the few countries that embrace Blockchain and its potentials, and the regulators have just recently approved the first Bitcoin fund manager.
UK is renowned for leading the financial industry and acting as the centre of tech innovation. It is home to numerous Blockchain related start-ups, and Bitcoin, although not regulated yet, is considered legal. “We don’t prohibit regulated firms from engaging in digital currency trading, nor do we prohibit banks from offering banking services to deal with currency firms that use blockchain,” said Chris Woolard, the Financial Conduct Authority’s executive director. He also stated that they do not view digital currencies as a bad thing, but they do have to exercise a degree of caution.
Netherlands has always been one of the friendliest countries towards Bitcoin, ever since it was introduced. In fact, it has its own ‘Bitcoin City’ whereby people can use bitcoins to make purchases ranging from gas to dental services. It also attracts various start-ups and cryptocurrency communities to form regular meet-ups and events across the nation, including the setup of a ‘Bitcoin Embassy’. Dutch organizations and banks have also been at the forefront of blockchain initiatives; one of those initiatives being the development of an internal blockchain prototype dubbed “DNBCoin”.
Cryptocurrencies are currently not regulated under the Financial Services Act of Netherlands. Bitcoin has been classified by one court as a “medium of exchange” but not electronic money and by another court as an “object” subject to seizure. As far as Bitcoin mining goes, it is not banned by the Dutch government, but, as well as mixing services, it is recognized as money-laundering indicators and can raise suspicion.
Since Bitcoin, as well as Bitcoin service providers, are officially legalized by the South Korean government, the country has recently seen a significant increase in the number of Bitcoin related start-ups such as Bithumb, one of the world’s largest Bitcoin exchanges. However, South Korea is looking to soon introduce a stricter regulation and monitoring of virtual currencies, which would include strengthening user verification procedures and would require banks to perform due diligence on bitcoin exchanges.
Japan has recently legalized Bitcoin, recognising it as a kind of prepaid payment instrument, essentially granting it the same legal status as any other currency, whilst also bringing all locally owned Bitcoin exchanges under the anti-money laundering (AML) laws. The country’s favourable move towards the currency has helped significantly increase the currency’s overall value.