Country by Country: Is Cryptocurrency legal?
As I’m sure you can imagine, whenever a new paradigm-shifting technology comes into play, the governments of the world need to assess and analyze it for various reasons. Is it dangerous? Can it be used to commit crimes? Does it fit into a current regulatory scheme? Can we even regulate it? The questions are endless.
This happened with most major technology innovations in the past 50 years, but cryptocurrency is a special category, as it encompasses many different spheres of what most advanced countries attempt to regulate; such as internet browsing history and the transferring of money.
Because of this, many countries around the globe have taken vastly different approaches on handling the introduction of cryptocurrencies, but I believe that they can all be put into one of three categories; legal and regulated, legal and unregulated, and illegal.
Category 1: Legal and Regulated.
The majority of advanced countries are going to be in this category. This category recognizes the legitimate uses of cryptocurrency, but also accounts for the fact that it can be used for nefarious purposes, such as buying prohibited items from the dark web, or money-laundering. They also recognize cryptocurrency in order to properly collect taxes from it. Some major players in this category include:
*China gets a footnote because it is currently “highly regulated”; while individual use is legal, commercial financial institutions are prohibited from dealing with cryptocurrency and Initial Coin Offerings (ICO’s) are banned entirely.
Category 2: Legal and Unregulated.
As the name suggests, countries in this category recognize the existence of cryptocurrencies, but have either made statements that they will not regulate them whatsoever, or their laws do not cover cryptocurrency use. Some examples include:
Category 3: Illegal.
A few countries have taken the extraordinary step of outlawing all use of cryptocurrencies, as it competes with their national currency and/or has been cited as being used for malicious purposes. The inclusive list of countries includes:
The takeaway here is that cryptocurrency is generally safe to use (unless you live in one of the four countries in category 3!), so long as you are complying with your country’s laws, which for most people is probably just declaring them on your taxes.
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