This report summarizes the cryptocurrency policies and regulatory regimes in fourteen jurisdictions around the world. Among the key issues covered in the report are matters relating to the legality of cryptocurrency markets; the tax treatment of cryptocurrencies; and the applicability of anti-money laundering, anti-organized crime, and anti-terrorism-financing laws.
In terms of the legal recognition of cryptocurrency markets, the jurisdictions included in this report may be categorized into two groups. In the first category are countries that permit cryptocurrency markets to operate, and within this group some countries (including Belarus, Gibraltar, Jersey, and Mexico) have been proactive in that they have enacted specific laws recognizing and regulating the cryptocurrency markets, while others (such as Brazil, Argentina, and France) allow the markets to exist but have yet to issue industry-specific laws. The second category of countries includes those that have taken steps to restrict the cryptocurrency markets, mainly by barring financial institutions within their borders from participating in them (China and Iran).
Of the countries that permit cryptocurrency markets to operate, many impose taxes. However, the tax treatment of income generated from a cryptocurrency transaction may vary depending on how it is categorized. For instance, in Argentina a transaction of this nature would be taxed in a manner similar to revenue generated from the sale of securities and bonds, whereas in Switzerland cryptocurrency is categorized as a foreign currency for tax purposes. Some of the countries included in the report do not levy taxes on cryptocurrency transactions (Belarus and Jersey).
Many of the countries that permit cryptocurrency markets to operate have enacted laws subjecting organizations that participate in these markets to rules designed to prevent money-laundering, terrorism financing, and organized crime. These include Australia, Belarus, Canada, Gibraltar, Japan, Jersey, and Switzerland. While a bill that would have the same effect is working its way through the Brazilian legislative process, countries like Argentina, France, and Mexico have yet to follow suit.
Prepared by Hanibal Goitom
Foreign Law Specialist
Last Updated: 12/30/2020