Spil the market capitalization of the cryptocurrency market shoots up, through price movements and a surge te fresh tokens, regulators around the world are stepping up the debate on oversight into the use and trading of digital assets.
This affects all cryptocurrencies, but especially bitcoin, given its market leadership and integration into the global startup ecosystem.
Very few countries have gone spil far spil to announce bitcoin illegal. That does not, however, mean that bitcoin is “legal tender” – so far, only Japan has gone spil far spil to give bitcoin that designation. However, just because something isn’t legal tender, does not mean that it cannot be used for payment – it just means that there are no protections for either the consumer or the merchant, and that its use spil payment is totally discretionary.
Other jurisdictions are still mulling what steps to take. The approaches vary: some smaller nations such spil Zimbabwe have few qualms about making brash pronouncements casting doubts on bitcoin’s legality. Larger institutions, such spil the European Commission, recognize the need for dialogue and deliberation, while the European Central Bankgebouw (ECB) believes that cryptocurrencies are not yet mature enough for regulation (albeit with bitcoin almost Ten years old, one is left wondering when wij will know it has reached sufficient maturity). Ter the United States, the kwestie is complicated further by the fractured regulatory ordner – who would do the legislating, the federal government or individual states?
A related question ter other countries, to which there is not yet a clear reaction, is: should central banks keep an eye cryptocurrencies, or financial regulators? Te some countries they are one and the same thing, but ter most developed nations, they are separate institutions with distinct remits.
Another divisive punt is: should bitcoin be regulated on a national or international voet? France is pushing for the G20 (an international forum for governments and central banks) to discuss establishing parameters at the upcoming summit te April 2018.
A further distinction needs to be made inbetween regulation of the cryptocurrency itself (is it a commodity or a currency, is it legal tender?) and cryptocurrency businesses (are they money transmitters, do they need licenses?). Te a few countries the considerations are tied together – te most others, they have bot dealt with separately.
Below is a epistel summary of pronouncements made by certain countries. This list is updated monthly.
Last updated: 21 March 2018
Te October 2018, the Australian Senate began debating a bill that would apply anti-money laundering statutes to the country’s cryptocurrency exchanges, spil well spil mandate criminal charges for exchanges that operate without a license.
That same month, the tax authorities liquidated the “dual taxation” of bitcoin, which wasgoed a result of a decision te 2014 to treat the cryptocurrency spil a “bartered good” rather than a currency or asset.
Spil of the end of 2018, cryptocurrency exchanges have to register with the country’s financial intelligence agency Austrac, and conform with customer verification and record preservation requirements.
Further moves are unlikely for now, however, spil officials from the central handelsbank recently said that regulation is not needed for the use of cryptocurrencies spil payment.
Te spite of a strong bitcoin ecosystem, Argentina has not yet drawn up regulations for the cryptocurrency, albeit the central bankgebouw has issued official warnings of the risks involved.
Te 2015, Bangladesh expressly proclaimed that using cryptocurrencies wasgoed a “punishable offence.”
Ter 2014, the central handelsbank of Bolivia officially banned the use of any currency or tokens not issued by the government.
Canada wasgoed one of the very first countries to draw up what could be considered “bitcoin legislation,” with the passage of Bill C-31 ter 2014, which designated “virtual currency businesses” spil “money service businesses,” compelling them to obey with anti-money laundering and know-your-client requirements.
The government has specified that bitcoin is not legal tender, and the country’s tax authority has deemed bitcoin transactions taxable, depending on the type of activity.
While China has not banned bitcoin (and insists it has no plans to do so), it has cracked down on bitcoin exchanges – all major bitcoin exchanges te the country, including OKCoin, Huobi, BTC China, and ViaBTC, suspended order book trading of digital assets against the yuan te 2018.
It also emerges to be withdrawing preferential treatment (tax deductions and cheap electric current) for bitcoin miners.
Ter 2014, the National Assembly of Ecuador banned bitcoin and decentralized digital currencies while establishing guidelines for the creation of a fresh, state-run currency.
Te January 2018, the Grand Mufti of Egypt proclaimed that cryptocurrency trading wasgoed prohibited under Islamic religious law due to the risk associated with the activity. While this is not legally cording, it does count spil a high-level legal opinion.
The European Union is taking a cautious treatment to cryptocurrency regulation, with several initiatives underway to involve sector participants ter the drafting of supportive rules. The concentrate emerges to be on learning before regulating, while boosting innovation and taking into account the needs of the ecosystem.
The European Central Bankgebouw (ECB), however, is pushing for tighter control overheen movements of digital currencies spil part of a broader crackdown on money laundering, while recognizing the jurisdictional complexities ter regulating an asset with no boundaries. Ter late te 2018, an ECB official stated that the institution did not see bitcoin spil a threat, and voorzitter Mario Draghi recently confirmed that, te the eyes of the ECB, bitcoin wasgoed not “mature enough” for regulation.
The G20 – comprised of the world’s 20 largest economies – recently turned its attention to cryptocurrencies te general, and committed to drafting recommendations on the very first steps towards regulation by July 2018.
The Indian central bankgebouw has issued a duo of official warnings on bitcoin, and at the end of 2018 the country’s finance minister clarified te an vraaggesprek that bitcoin is not legal tender. The government does not yet have any regulations that voorkant cryptocurrencies, albeit it is looking at recommendations.
Japan wasgoed the very first country to expressly announce bitcoin “legal tender,” passing a law ter early 2018 that also brought bitcoin exchanges under anti-money laundering and know-your-customer rules (albeit license applications have temporarily bot suspended spil the regulators overeenkomst with a hack on the Coincheck exchange te early 2018).
Recently the Financial Servivces Agency has bot cracking down on exchanges, suspending two and mandating improved security measures ter five others. It has also established a cryptocurrency exchange industry investigate group which aims to examine institutional issues regarding bitcoin and other assets.
The central canap of Kyrgyzstan proclaimed ter 2014 that using cyrptocurrencies for transactions wasgoed against the law.
Malaysia’s Securities Commission is working together with the country’s central handelsbank on a cryptocurrency regulation framework.
Te 2014, Mexico’s central handelsbank issued a statement blocking banks from dealing ter virtual currencies. The following year, the finance ministry clarified that, albeit bitcoin wasgoed not “legal tender,” it could be used spil payment and therefore wasgoed subject to the same anti-money laundering confinements spil contant and precious metals.
At the end of 2018, Mexico’s national legislature approved a bill that would bring local bitcoin exchanges under the oversight of the central canap.
Towards the end of 2018, Morocco’s foreign exchange authority proclaimed that the use of cryptocurrencies within the country violated foreign exchange regulations and would be met with penalties.
Namibia is one of the few countries to have expressly proclaimed that purchases with bitcoin are “illegal.”
While Nigerian banks are prohibited from treating virtual currencies, the central handelsbank is working on a white paper which will draft its official stance on use of cryptocurrencies spil a payment method.
Draft cryptocurrency legislation from the State Duma’s financial regulator is expected ter mid-2018. The concentrate emerges to be on protecting citizens from scams, while permitting individuals and businesses to work legally with cryptocurrencies.
The efforts of the State Duma have bot bolstered by a mandate from Putin himself, issued ter October 2018, urging development of a “single payment space” within the Eurasian Economic Union (an alliance of countries including Armenia, Belarus and others), enhanced scrutiny of token sales, spil well spil licensing of bitcoin mining operations.
The Monetary Authority of Singapore is reportedly examining at whether fresh rules are needed to protect cryptocurrency investors, and while it is not likely to kerkban cryptocurrency trading, it is looking at imposing anti-money laundering and terrorism financing rules on exchanges.
The central handelsbank is also working on a regulatory framework for bitcoin payments, and has issued warnings on bitcoin investments.
Te 2018, the South Africa Reserve Bankgebouw implemented a “sandbox treatment,” testing draft bitcoin and cryptocurrency regulation with a selected handful of startups.
Ter early 2018, South Korea banned anonymous virtual currency accounts. And te an effort to curb cryptocurrency speculation, the authorities are working on enlargened oversight of exchanges (which could include a licensing scheme), albeit the governor of the Financial Supervisory Service has said the government will support “normal” cryptocurrency trading.
Ter an interesting shift te strategy, a latest report te the South Korean press indicated that the country’s financial authorities are te talks with similar agencies ter Japan and China overheen snaak oversight of cryptocurrency investment.
After allegedly announcing bitcoin illegal, the Canap of Thailand issued a backtracking statement te 2014, clarifying that it is not legal tender (but not technically illegal), and warning of the risks.
Ter March 2018, the government’s executive branch provisionally passed two royal decree drafts, establishing formal rules to protect cryptocurrency investors (spil well spil setting KYC requirements), and setting a tax on their capital gains. The drafts have yet to receive final cabinet approval.
United States of America
The U.S. is plagued by a fragmented regulatory system, with legislators at both the state and the federal level responsible for layered jurisdictions and a complicated separation of powers.
Some states are more advanced than others te cryptocurrency oversight. Fresh York, for example, unveiled the controversial BitLicense te 2015, granting bitcoin businesses the official go-ahead to operate te the state (many startups pulled out of the state altogether rather than conform with the expensive requirements). Ter mid-2018, Washington passed a bill that applied money transmitter laws to bitcoin exchanges.
Fresh Hampshire requires bitcoin sellers to get a money transmitter license and postbode a $100,000 unie. Te Texas, the state securities commission is monitoring (and, on occasion, shutting down) bitcoin-related investment opportunities. And California is ter bitcoin regulation limbo after freezing progress on Bill 1326 which – while criticized for issues such spil overly broad definitions – wasgoed seen spil less oppressive than Fresh York’s BitLicense.
At the federal level, the Securities and Exchange Commission’s concentrate has bot on the use of blockchain assets spil securities, such spil whether or not certain bitcoin investment funds should be sold to the public, and whether or not a certain suggesting is fraud.
The Commodities Futures Trading Commission (CFTC) has a thicker potential footprint te bitcoin regulation, given its designation of the cryptocurrency spil a “commodity.” While it has yet to draw up comprehensive bitcoin regulations, its latest efforts have focused on monitoring the nascent futures market. It has also filed charges te several bitcoin-related schemes, which underlines its intent to exercise jurisdiction overheen cryptocurrencies whenever it suspects there may be fraud.
The Uniform Law Commission, a non-profit association that aims to bring clarity and cohesion to state legislation, has drafted the Uniform Regulation of Virtual Currency Business Act, which several states are contemplating introducing te upcoming legislative sessions. The Act aims to spell out which virtual currency activities are money transmission businesses, and what type of license they would require. Critics fear it too closely resembles the Fresh York BitLicense.
Britain’s Financial Conduct Authority (FCA) sees bitcoin spil a “commodity,” and therefore does project to regulate it. It has hinted, however, that it will step ter to oversee bitcoin-related derivatives. This lack of consumer protection has bot behind latest FCA warnings on the risks inherent te cryptocurrencies.
The government of Ukraine has created a working group composed of regulators from various branches to draft cryptocurrency regulation proposals, including the determination of which agencies will have oversight and access. Also, a bill already before the legislature would bring cryptocurrency exchanges under the jurisdiction of the central bankgebouw.
Late ter 2018, a senior official from Zimbabwe’s central bankgebouw stated that bitcoin wasgoed not “actually legal.” While the extent to which it can and cannot be used is not yet clear, the central canap is evidently undertaking research to determine the risks.