Crypto friendliness may mean different things to different people and rightfully so since. No two countries seem to have the same crypto regulation in place. Though, at the same time, governments across the world have come a long way since crypto came to life.
Today we will bring you the three most crypo friendly countries in the world.
What Makes a Country Crypto-Friendly?
For a country to be considered one of the world’s most crypto-friendly countries in addition to let it be legally regulated it has to meet certain economic requirements such us:
Zero (or low) crypto capital gains taxes
Zero (or low) crypto income tax
Zero (or low) tax on crypto exchanges like crypto trading or spending
Knowing now that crypto taxation is the largest indicator of a country's stance on cryptocurrencies, let's deep dive into the types of cryptocurrency taxes that most countries impose. Following are the crypto trades and activities that are taxed by most governments:
Crypto Exchanges: including trading crypto for another cryptocurrency or selling it for your national (or any fiat) currency.
Crypto Transactions: Spending crypto to purchase products or services (Crypto Payments)
Any income from crypto
What are The Most Crypto-Friendly Countries in The World?
1. El Salvador
El Salvador is the unquestioned leader regarding the regulation of cryptocurrencies. This Central American country approved a law that effectively made Bitcoin legal tender.
To attract foreign investment, the government has recently exempted foreign crypto-investors to pay income tax and capital gains tax on Bitcoin. To strengthen further its position among the most cryptocurrency-friendly countries, the country has announced the El Salvador Golden Visa program, under which immediate permanent residency, not citizenship, will be granted to crypto-investors after they meet the minimum investment requirement made in crypto.
It also plans to preserve its status as a cryptocurrency hub by setting up the world's first Bitcoin City regardless of strong criticism from established financial institutions. The city will be powered by geothermal energy and will have no income tax, no property tax, and no capital gains tax.
2. Portugal
One of the countries best recognized for its ability to invest in cryptocurrencies is Portugal. Such a tax-free way of life for crypto-investors is one of the reasons why Portugal has been rapidly growing in popularity.
For the majority of investors, there is no Portugal crypto tax on crypto trading, income, and capital gains. This is because it treats cryptocurrency not as an asset but as any other legal tender. This means that most transactions are crypto tax-free, and only income related to professional cryptocurrency activities is taxed. This means that the crypto users count Portugal as their tax haven.
The Portuguese government also allows employers to pay wages using cryptocurrency, and makes it easy to purchase crypto on a variety of platforms. To benefit from these generous policies, crypto holders do need to be residents or citizens. However, Portugal offers a golden visa program that simplifies the process, allowing people to become residents through investment.
3. Switzerland
Switzerland emerged as an early shooting star in the realm of cryptocurrencies. In 2018, Swiss banks became the first to permit cryptocurrency businesses to set up trading accounts, a major step in promoting legitimate uses of cryptocurrency and reducing fraud. Nowadays, Switzerland categorizes cryptocurrency as an asset, and some locations even regard Bitcoin as legal tender, which makes it one of the friendliest countries for Bitcoin.
Every Swiss region has its unique legal regulations and definitions regarding cryptocurrencies, but most are very cryptocurrency-friendly. As a result, it has emerged as the "cryptocurrency valley", due to its large number of entrepreneurs, start-ups, companies, stores and cryptocurrency investors.
In addition to this, Switzerland's banking environment both minimizes risk while maximizing privacy, which carries over to crypto-investors as well. Indeed, it is this dedication to embracing cryptocurrencies that earns Switzerland the title of one of the most cryptocurrency-friendly countries in the world.
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