Bitcoin Regulation Guide by Country

Olga Shirimova
September 18, 2020
Bitcoin legality

Is Bitcoin legal to use? And what about taxes? These are not simple questions: crypto regulation depends on where you are and what you are doing with your crypto.

To know if your government welcomes Bitcoin and how far this love (or hate) goes, read this article.

The Bitcoin legality world map: though most countries allow to use crypto, the rules are very diverse and often unclear. Image source: Medium

Why It’s Important to Know the Legal Status of Crypto

Anyone who is going to buy, sell, trade, or mine cryptocurrency must be 100% sure it’s legal in this area. Remember that BTC and other digital currencies are a new thing, and many countries still don’t know how to approach it. Often, there’s no crypto regulation or it gives you mixed messages.

Some countries embrace the innovation. Others prefer a “wait-and-see” attitude. Finally, there are states that ban crypto and punish law-breakers.

Countries That Prohibit Bitcoin ? 

The countries that ban crypto normally say it’s a bubble or a Ponzi scheme that frauds use to steal people’s savings. Also, there are crime concerns: “everyone knows” that Bitcoin is custom-made for drug-dealing, tax evasion, money-laundering, terrorist financing, and other dirty things.

Below are the countries that share this view:

  • Afghanistan
  • Algeria
  • Bangladesh
  • Bolivia
  • Egypt
  • India
  • Pakistan
  • Qatar
  • Saudi Arabia
  • Vanuatu
  • Vietnam

Not all of them are equally hostile, though.

Bangladesh, Algeria, and Bolivia are probably the worst places in the world for using or even holding crypto. Afghanistan that used to be one of the biggest haters of crypto now seeks to use it for boosting the national economy. In Vietnam, it’s illegal to use cryptos for payments, but the regulation allows you to trade them for other virtual assets.

Also, bans do not mean that all citizens stay away from illegal assets. It’s easy to check. Search for something like “How can I buy BTC in X country” and you will see that citizens can always find ways around the law.

SAFETY TIP. ? When visiting a country where BTC is illegal, avoid discussing, or even mentioning your crypto activities. It’s dangerous as propaganda often presents any BTC user or blockchain promoter as a fraud.

Countries That Welcome Bitcoin ? 

Now, let’s consider the countries with a warmer crypto climate. For your convenience, we have sorted them in alphabetical order.


Argentina does not consider Bitcoin a legal currency, because it’s not government-issued. Rather, the law views crypto as something like goods, stocks, or bonds. It means when you sell your bitcoins, you pay the same tax as if you were selling stocks (15%).

Currently, Argentina has no specific legal guidelines for cryptos. The government warns citizens against possible BTC frauds, but that’s all. Therefore, more and more people start using BTC, as the national economy and currency are unstable.


In this country, buying and holding crypto is tax-free. However, selling digital money is a taxable event. In this case, you pay capital gains tax.
For instance, if you buy 1 BTC for $5,000 and then sell it for $10,000, your taxable capital gain will be $5,000.

When you buy stuff or pay bills with Bitcoin, the law sees it as selling crypto and applies the same tax. Thus, if you buy a car worth $20,000 and pay in BTC, you sell your BTC for $20,000.


Belarus warmly welcomes blockchain and crypto startups in its Hi-Tech Park, the local Silicon Valley. The regulatory climate of the valley is more than pleasant. To attract more hi-tech guys, Belarus has developed clear and permissive crypto regulation.

The best thing is that Belarus does not tax any operations with crypto, including purchase and sale. But when you exchange your BTC for goods or fiat currencies, you have to pay income tax. 


In Belgium, the government does not regulate the use of cryptocurrencies. Neither it sees them as a serious threat to the national economy or a money-laundering tool.

Interestingly, the tax you pay depends on the legal status of your crypto activity. If crypto investing, mining, or trading is a hobby for you, the law sees it as normal management of private assets. Therefore, you pay no income tax.

But if you make living out of it, they tax your crypto profits as a professional income and apply standard rates (25% — 50%).


Canada is one of the friendliest states in the world. Digital money usage is completely legal and the national crypto regulation encourages you to trade, hold, or otherwise use your coins.

This country is home to many big exchanges including Coinbase, Kraken, and Coinsquare. Also, there are hundreds of Bitcoin ATMs and a lot of vendors accepting crypto as payment.

As for taxation issues, investors/traders treat their crypto as a commodity, so they report all gains and losses, and pay corresponding taxes. In general, the taxation of crypto may be complicated and unclear


Right now, the Chinese government encourages the development of blockchain and says it’s the future. As for cryptocurrencies, they face skepticism and restrictions. At the same time, they are legal.

Though the law does not allow financial institutions to use crypto as money, individuals are free to own, send, and receive it. You can sell or buy BTC in China on a peer-to-peer exchange like LocalBitcoins, as CEX platforms are banned here.

Moreover, China now recognizes BTC as property and protects it. For instance, if someone steals your crypto holdings, the court will see it as material damage and punish the guilty ones.


Many Cyprus-based businesses trade with Africa, Eastern Europe, and other areas that love crypto payments. So, Cyprus has been very accepting towards cryptocurrencies: here, you can legally own, mine, buy, sell, and exchange digital assets. There are no clear laws to regulate these activities.

The government is not in a hurry: it needs time ”to evaluate all the risks and benefits” and no one knows how long this process will take. Until then, crypto users and blockchain companies may enjoy the freedom that legal unclarity grants.


This country is famous for its open-minded approach to crypto assets and companies. It hosts more than 1,400 blockchain startups, though now it’s harder to get a license.

Here, crypto has the status of “a value represented in digital form”. You can freely use it as a payment tool, much like regular money. Crypto transactions are not subject to VAT.


France has no clear definition of crypto, though in March 2020 a French court suddenly decided that BTC is currency. The crypto regulation is rather vague, but in an encouraging way. It seems the trend will continue.

Right now, more and more retailers start accepting crypto payments, from small tobacco shops to the top French brands like Sephora and Decathlon.

Speaking of taxation, VAT applies only when you convert digital money into traditional one or spend it on goods or services. Crypto-to-crypto transactions are still tax-exempt.


Georgia is another place where BTC users would feel at home. Here, they pay no taxes on the profits they receive from selling crypto. Even better, it doesn’t matter if they sell BTC for fiat or digital money.

In the eyes of the Georgian regulation, selling crypto is the same thing as exchanging one type of money for another, and it’s not a taxable event.


Germany is a good country to get started with crypto, as your holdings are exempt from capital gains tax. Therefore, if you buy BTC for $5,000 and then its price doubles, you don’t have to pay anything for getting richer. Note that you need to hold your crypto for at least 1 year to have this advantage.

Also, if your gains are below 600 euros a year, you can trade your digital assets without paying any taxes.


This small state has been very crypto-proactive. They offer a favorable regulatory climate that promotes the use of digital money and fosters crypto businesses. In Gibraltar, you pay no capital gains and dividend taxes on your crypto profits. 


Right now, there are no legal procedures to tax the income you derive from crypto transactions or mining. But if the Greek tax authorities classify your crypto activity as a business and your profits as capital gains, it’s another story.

In this case, an individual has to pay the capital gains tax (15%). For a company, the tax rates are between 22% and 45%.


Again, there are no specific legal guidelines to follow. The tax treatment of crypto activities depends on “the character of these activities and the parties involved”. It means every case is different and you should consider it separately. if you are a miner, you pay no taxes, as this is not “economic activity”.

In general, Ireland tends to apply “normal tax rules” to digital currencies.


Israel is an attractive jurisdiction for a crypto user or a business and has a numerous crypto community. At this moment, the regulation is rather relaxed and unclear. The government is working to make it more accurate and transparent but it’s a slow process.

As for the tax issues, the Israeli authorities see crypto as “valuable property”. Therefore, if you sell your BTC, you pay capital gains tax. If you make crypto transactions regularly, your income is subject to income tax. Besides, you cannot avoid VAT.


As a member of the Eurozone, Italy is friendly to cryptocurrencies, though it’s not among the top enthusiasts. Officially, Italy defines BTC as “virtual currency” that citizens can use as an alternative method of payment if they want.

There is no law saying that crypto owners must declare their holdings or pay any taxes on gains they receive from crypto transactions. Therefore, you don’t know what to do in this case. The experts agree that a private crypto investor doesn’t need to worry about these issues if their gains stay within a reasonable limit.


The motherland of Satoshi Nakamoto was among the first to embrace the new-gen money. There, crypto trading and mining are legal if you are ready to pay a tax of up to 55%. It looks so discouraging, that many people and companies forget to report their cryptocurrency gains.

The good news is that you can pay less than 55%, depending on how much you earned last year. To calculate how much you owe to the state, examine the tax brackets.


In the past, the Latvian government used to be suspicious of cryptos and was not sure if it was good enough for payments. Now, the authorities have warmed up towards digital money: they want to tax crypto transactions and take their share of profits. Thus, they are working to make their crypto regulation better.

Crypto is “the legal means of exchange”. The regulators plan to impose a 20% tax on all the gains you receive from crypto transactions. 


This Baltic state is among the first ones in the EU who prepared clear legal guidelines for crypto activities. They recognize digital money as “current assets”. You can use it to pay for goods and services or store it for sale.

Any income you receive from an “individual purchase” of crypto is subject to a 15% income tax. As for VAT, crypto transactions follow the same rules as fiat ones. Mining is free from VAT. 


Malaysia does not tax crypto transactions at all. Bitcoin is legal and safe to use, though they don’t recognize it as legal tender or currency. Rather, it’s a kind of security.

At the same time, the Malaysian government regulates crypto exchanges: they have to take measures for protecting users’ funds. 



Malta is one of the world leaders when it comes to crypto regulation. Though they don’t see digital money as legal tender (and who does?), it offers a comfortable environment for blockchain startups and crypto exchanges.

They apply no VAT to crypto-crypto and crypto-fiat transactions. Long-held crypto funds are free from any taxes unless you make several trades within 1 day. In this case, the Maltese law sees it as day trading and taxes your gains as business income.


The Mexican financial regulators recognize crypto but see it rather as a fintech tool than a currency. Digital money fans would be happy to know that this country does not tax their crypto transactions.

The local tax authorities have some plans to change the situation, but so far they haven’t come up with a clear-cut initiative. So, crypto regulation still belongs to the future.

The Netherlands

The taxation regime in the Netherlands is rather beneficial. 

The tax rate they apply to mining and trading depends on if the authorities qualify this activity as a source of income or not. There are inspectors to decide what your particular case looks like.

As for VAT, the Dutch legislators don’t make this issue clear.


Recently, Nigeria has seen a growing demand for BTC. Here, you will find a vibrant community that uses crypto for purchases, cross-border transfers, investing, trading, lending, and so on.

In Nigeria, crypto is legal, but it lacks regulation. Meaning those who use it, do it at their own risk. Thus, if someone falls victim to a BTC fraud, it’s their problem.


“Wealth in the form of virtual currency”, as they call crypto here, can be accepted as payment, traded, and stored electronically.

To any income you obtain from selling crypto, they apply capital gains tax. You declare it as “other income”, just like your mining profits. 


When it comes to taxation, Poland labels crypto as “virtual currency”. Starting from January 2019, any BTC seller has to pay capital gains tax (19%), regardless of the amount of gains.

However, if you switch between cryptos (i.e. don’t convert crypto to fiat), there’s no need to mention these profits in your declaration. As for mining, no taxes apply to your rewards until you sell them.


Portugal is one of the 8 countries that impose zero tax on crypto trading and transactions. So, when you buy or sell digital assets, you pay neither capital gains tax nor VAT. It applies both to crypto-crypto and crypto-fiat operations.

This freedom from taxes makes Portugal one of the sweetest homes for crypto traders, along with Germany, Singapore, Switzerland, and Malta.


Earlier this year, Russia was going to adopt a law that would make any company issuing or trading crypto illegal. Later, they have changed the draft making it more neutral. Now, the Russian law-makers see cryptocurrency as “a digital set of data”. You may use this set of data as a payment method or an investment tool.

At the same time, you cannot use crypto to purchase goods and services. Therefore, Russia grants BTC legal status but prohibits you from buying a cup of coffee with it.


According to the Monetary Authority of the city-state, Bitcoin is a commodity, like gold or oil. Whatever the term, neither individuals nor companies who make long-term crypto investments pay capital gains tax. Maybe because it doesn’t exist in Singapore.

However, if crypto trading is the core business for your company, you pay income tax. 


Slovenia loves cryptocurrency: in this country, the list of things you can buy with BTC includes almost everything you need daily. There are more than 1,000 crypto-friendly retailers, and this number is growing.

However, there are taxes applied to crypto transactions. Individuals don’t pay any capital gains tax when they sell BTC, but they cannot avoid income tax (no matter if they sell their crypto or let it sit). 


In Spain, they tax crypto trading the same way as forex trading. In theory, exchanging one crypto for another is a taxable event, too. But in practice, there’s no legal mechanism to calculate your gains in this case. So, only crypto-fiat transactions are taxable.

Also, you have to declare your crypto assets. If the value of your holdings is higher than a certain amount (it depends on the region), you pay wealth tax, too. When you buy goods from a store, you pay VAT. 


Another country that we can call crypto haven. In Switzerland, you can buy, sell, or hold cryptocurrencies without having to pay capital gains tax. If you mine crypto, you have to pay income tax as the law considers your hobby self-employment.

Professional traders have to pay corporate tax on their profits. 


Sweden has no specific laws to regulate cryptocurrencies. Instead, the standard financial laws may apply to your crypto activities. It depends on what these activities are, what you use crypto for, etc.

When you sell your digital assets, such a transaction is free from VAT. The profits you obtain from cryptocurrency investments are subject to capital gains tax.


Here, crypto is legal and rather popular, but the government is still cautious. Recently, they became a little more welcoming and started to develop some regulations. The most strict rules apply to exchanges and ICOs.

Individual users will not face any legal resistance, but businesses are less lucky. For instance, it’s illegal for a financial institution to invest and trade crypto, as well as to offer their clients financial advice on it.


Like many countries, Turkey provides no crypto regulation: the decision-makers don’t think it’s necessary to restrict crypto operations. Moreover, the authorities drafted a plan to create Turkcoin, the national crypto.

So far, the Turkish crypto climate has been a real delight. There are some talks about how the country should regulate crypto to prevent crime financing and money-laundering, but no one shares any details on it. 

The United Kingdom

The UK views crypto as foreign currency and taxes it accordingly. There is no VAT while you are exchanging currencies, but you have to pay capital gains tax when you buy something with crypto. If you are an investor, you have to pay the same tax on the profits you obtain.

In general, the taxability of your crypto activities depend on their aim, participants, and other conditions. As the regulation is not very consistent, you’d better consult a tax advisor if there are any doubts.

The United States

Here, everything is complicated. On one hand, there are 5.8 mln BTC users in the United States. On the other hand, the authorities and skeptics show strong resistance. As a result, the US crypto regulation is very strict, especially if you want to start an ICO or take part in it.

For regular crypto users, life is easier. It’s legal to buy, sell, and trade cryptocurrencies that have a status of “property”. According to the IRS, the taxable events are converting crypto to fiat, trading crypto with another currency, purchasing goods and services, and receiving income in digital money.


Currently, Ukraine is working to make its cryptocurrency regulation more consistent and clear. In March 2020, they issued guidance for taxpayers, who now have to report their BTC holdings as “intangible property”.

Miners don’t pay any taxes on their profits, so it becomes big business in Ukraine.

United Arab Emirates

In the UAE, the authorities are very passionate about blockchain. They even plan to start EMCASH, the national cryptocurrency.

The regulation is tolerant, but not very consistent. Though “virtual currencies” are illegal, the Central Bank says this ban has nothing to do with crypto. Today, the citizens and residents of the UAE can safely sell, buy, and trade Bitcoin and some other currencies.

The Countries That Cannot Make Their Mind ?

Finally, there are some countries where BTC and other cryptos remain in a legal limbo. It means their governments are uncertain and prefer to wait.

This approach has its pros and cons: if your crypto does not exist legally, there are no gains to report and no taxes to pay. On the other hand, there’s no authority to protect your property.

Here’s our updated grey list that includes:

  • Albania
  • Andorra
  • Barbados
  • Brazil
  • Columbia
  • Jordan
  • Kazakhstan
  • Kenya
  • Peru
  • Tunisia

Crypto Regulation: Closing Thoughts

Hopefully, this brief overview gives you a general idea of where you can happily live with your crypo.

One more thing: before buying a one-way ticket, make a deeper analysis. First, the moods of the regulators change quickly. Second, your rights, obligations, and tax rates may depend on if you are an ex-pat or a citizen.

There are always some “buts” and “thoughs”, at a closer look.

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