The growth in the popularity of cryptocurrencies could not go unnoticed, and many governments began to take steps to regulate the digital sector of the economy in order to attract investment. It should be noted that there is no single rating for all that would rank countries in terms of friendliness to the crypto business.
Malta can be called a leader in promoting ICO startups and developing blockchain technologies. The parliament and government of the country actively supports the concept of distributed ledger technologies.
Thus, the largest cryptocurrency exchange Binance, after a series of claims from Japan, Hong Kong and China, settled its headquarters in Malta. Today, the Binance cryptocurrency platform is the leader in terms of trading volumes. In the future, the Binance exchange intends to open its own digital bank.
The cryptocurrency market in Malta is governed by securities laws, as well as anti-money laundering and anti-terrorist financing (AML) compliance requirements. In 2018, the Digital Innovation Department was created in the country, the main task of which is to form a regulatory framework for cryptocurrency. It is also the responsibility of the agency to certify blockchain platforms, which should improve the verification processes for their users.
A small island nation attracts businessmen from all over the world with its favorable taxation. There are no taxes on income, capital gains, VAT, etc. These fiscal benefits also apply to crypto business.
In 2018, the Bermuda Monetary Authority passed the Digital Business Act, which regulates all areas of crypto business. In addition, local authorities are actively implementing AML rules to create a friendly legal environment for startups and crypto companies.
Switzerland was one of the first to develop regulations for conducting ICO projects. In the case of opening a trading cryptocurrency exchange or conducting an ICO startup, it is required to obtain the appropriate licenses from the regulator.
In a federal country, you need to highlight the canton of Zug, which has a low tax rate of 11.91%. This canton has been dubbed the “Crypto Valley” and has a favorable regulatory framework for cryptocurrencies. For example, state railroad ticket offices can accept payments for tickets in Bitcoin.
Another of the most attractive jurisdictions for investors in the crypto business is Gibraltar. Despite its small size, the country has achieved great success in the gambling sector, and also intends to achieve no less achievements in the field of crypto business development. Although cryptocurrency is not a legal means of paying for goods and services in Gibraltar, the regulator can issue a license that allows an entrepreneur to engage in crypto exchange in the country. The Gibraltar authorities are constantly working to improve the regulatory norms and rules of the cryptosphere.
Crypto in Slovenia qualifies as virtual currencies, which allows you not to tax digital currency on capital gains. However, individuals pay income tax on profits from cryptocurrencies, which is charged on the difference between the purchase and sale of cryptocurrencies. There are also fiscal obligations from mining. However, the latter is exempt from VAT.
The state is a well-known world financial center. Singapore’s economy is considered the most innovative, dynamic, competitive and most business-friendly. The state has the lowest level of corruption in the world.
In general, in the jurisdiction of Singapore, there are positive conditions for holding ICO start-ups and doing crypto business. The cryptocurrency sector in the country is regulated by the Monetary Authority of Singapore.
Estonia is one of the countries that was the first to legalize the cryptocurrency business. Thus, by the end of 2018, more than 900 licenses for the exchange of cryptocurrencies and the maintenance of virtual wallets were issued in Estonia.
Digital services in Estonia are widely used in the public and private sectors. In particular, Estonia can be called a pioneer in the field of e-residency. This allows citizens of other countries to obtain a virtual resident status and have electronic access to government digital services via the Internet.
The pseudonym of the creator of Bitcoin (Satoshi Nakamoto) is Japanese, the first major Bitcoin exchange (Mt. Gox) was born here, and its national currency, the yen (JPY), is the second fiat currency against the volume of Bitcoin, according to CryptoCompare. It’s like this Asian country of over 125 million inhabitants should have been among the cryptocurrency-friendly countries from the start.
As of April 2017, Japan recognizes Bitcoin and cryptocurrencies as legal property and payment methods. The rules were flexible even for crypto companies until several high-profile hacks appeared on the horizon.
It is very easy for a foreigner to register a business in the country, and this can be done through a trusted representative. It is not even necessary to come to the country to open a company. According to the created conditions for doing business, Georgia is even in the TOP-10 countries in the world (Doing Business rating). Typically, foreigners register a business within one hour as part of a one-stop shop, fill out the necessary forms and pay taxes.
As for the cryptocurrency business, in Georgia the government is just starting to take the first steps in regulating this area. In 2019, the Ministry of Finance of Georgia published a decision on the tax regulation of cryptocurrencies in Georgia.
In the jurisdiction, cryptocurrency qualifies as a virtual asset, not money. This frees it from regulation by supervisory authorities. In 2018, the Hong Kong Financial Services Agency published a report on money laundering and terrorist financing, according to which the role of cryptocurrency in such violations was considered insignificant.