MOST CRYPTO-FRIENDLY COUNTRIES IN THE WORLD TODAY :
Since the inception of cryptocurrency in 2009, the digital currency has continued to be on the rise. Furthermore, we have seen an upsurge in its adoption in various countries in the last ten years. The rise in crypto use has continued to grow. Hence, it becomes important to know which countries have the most crypto-friendly atmosphere for effective trading of the currency.
Issues like regulatory frameworks, taxes, the rate of a fiat currency, and inflation are key determinants of a nation’s acceptance of these digital assets. For intending investors in the crypto space, knowing the countries that provide a safe place for crypto investments to grow is beneficial. The top five countries that encourage the presence of cryptocurrencies are;
- United Arab Emirates
- Portugal: Exchange of cryptocurrencies for other currencies and trading of the digital asset attracts no form of taxation. Portugal is known to be very crypto-friendly. It allows investors to set up a base in the country through its many programs that provide amenable residency and citizenship permits. Portugal is a crypto haven for individual investors thanks to its fiscal policy. Under this policy, it does not charge tax on capital gains made from selling cryptocurrency in a personal capacity. This could be because, for Portugal, crypto is viewed as a form of payment rather than an asset.
- Bahrain: By 2019, the government of Bahrain made the dealings of crypto-centric businesses legal. This development made Bahrain the first country in the Middle East to develop comprehensive rules to guide the adoption of crypto-assets. Early in 2022, Binance, the world’s largest crypto exchange secured a licence to operate in Bahrain. Hence, increasing access to the crypto services offered by the country. Bahrain has banking regulations for crypto in place. It further recognizes the currency as an official method of payment. This is why many crypto companies in the Middle East are setting up there.
- Singapore: Singapore is noted as one of the most well-developed economies in the world with access to both developed and developing markets. Regarded as the fintech hub of Southeast Asia, Singapore has created a balanced regulatory and legal framework for crypto assets. Its flexible guidelines makes it a crypto-friendly country. Singapore imposes no capital gains tax on goods and services transacted with crypto. It also provides a six-month grace period for crypto companies to operate without a license.
- Switzerland: In Switzerland, the rules that apply to crypto-assets differ from one region to another within the country. For instance, Lugano is viewed as a crypto-friendly city as it plans to pay its taxes with the digital currency. However, in Bern, regulations are stricter, and mining and trading are viewed as regular income. Switzerland’s financial structure allows for high levels of privacy with low risk, which makes it a viable market for cryptocurrencies.
- United Arab Emirates: Like Bahrain, the UAE has also enacted clear guidelines that encourage the increased use of cryptocurrencies. The support of innovation, blockchain technology, and crypto adoption establishes UAE as a crypto-friendly country. The Abu Dhabi Global Market lays out clear regulations to be followed while conducting crypto-related transactions. UAE positions itself as the crypto hub of the Middle East region, and with its recent approval of Binance, it just might get the crown.
Other countries that are considered to be crypto-friendly include El Salvador, Slovenia, Malta, Germany, Bermuda, etc. With the increasing recognition of cryptocurrencies as digital assets, and the potential for growth of this industry, countries that are yet to provide the necessary frameworks to support the existence of crypto as a virtual currency will soon follow in the footprints set by these five countries. The world is a global village, and cryptocurrencies might just become the dominant medium of exchange.