Is Bitcoin Legal: An Overview of Different Countries
In some of the developed countries, including the USA, Canada, the U.K., and Japan, Bitcoin is legal.
12:33 17 December 2020
On the other hand, the legal status of Bitcoin is not clear in other countries. Although there is a hype that Bitcoin will disrupt the global financial system, several countries strictly ban Bitcoin.
However, tech firms and large corporations are working hard to improve the digital infrastructure. Additionally, legal and tax authorities, government agencies around the world try to build regulations for making Bitcoin a global financial system. Here you will know about the legal status of Bitcoin in different countries.
Countries Where Bitcoin is Legal
First, let’s discover some of the top countries where Bitcoin is legal. However, each country may have different regulations for various activities of Bitcoin. Most of the people in these countries use the official app bitcoin revolution for trading Bitcoin.
Bitcoin is legal in the United States of America. It is one of the early adopters and has made significant developments in the crypto space. There are a number of businesses and retailers that accept Bitcoin payments.
Moreover, some of the best Bitcoin exchanges are established in the USA. The tax regulatory authority IRS has recently proposed special regulations for Bitcoin and cryptocurrencies. Bitcoin is not legal tender in the USA, and it is considered a property.
The United Kingdom
Bitcoin in the UK is legal and has different implications in various countries. Some countries treat Bitcoin as property. On the other hand, the tax authorities treat it as an alternative currency. You can conduct online research to know which country uses Bitcoin for what purpose within the UK.
It is believed that the founder of Bitcoin, Satoshi Nakamoto, is from Japan. This is one of the top countries where Bitcoin is legal. The tax authority of Japan has issued special regulations for Bitcoin. A study revealed that the Japanese currency ‘Yen’ holds the highest number of Bitcoins in circulation.
However, it was possible after China banned the usage of cryptocurrencies in the year 2017. Almost all the large crypto exchanges moved to Japan from China after this event.
The Australian government announced that Bitcoin is a property and subjected it to Captial Gains Tax. All the earnings in Bitcoins will be calculated into the equivalent Australian Dollar for tax purposes.
Bitcoin is legal in South Korea. The government of South Korea allows its citizens to trade and invest in Bitcoin. It also supports other cryptocurrencies.
Countries Where Bitcoin Is Illegal or Prohibited
Regardless of the popularity and increasing demand, some countries still ban Bitcoin. At the same time, some countries restrict only specific activities in relation to Bitcoin and cryptocurrencies.
The central bank of Bolivia banned Bitcoin in 2014. It announced that no currency would be considered legal that is not controlled by the government. The list includes Bitcoin and other cryptocurrencies.
Some Bitcoin activities are not allowed in Colombia. Many stores and retailers accept Bitcoin, but it’s not a currency. Moreover, the Costa Rican Central bank clarified that cryptocurrencies are neither currencies nor supported by the government. However, Bitcoin is not illegal, but there are no clear regulations of Bitcoin.
China banned the use of Bitcoin and cryptocurrencies in 2017. Earlier, it was one of the top countries for adopting Bitcoin and altcoins. However, it has banned trading and investing after 2017. Most of the major crypto exchanges moved to Japan after the ban.
The Vietnam government and state bank of Vietnam banned Bitcoin payments. However, investing in Bitcoin is not illegal in Vietnam.
The Russian government also announced that virtual currencies like Bitcoin are not completely illegal. However, the government prohibited Bitcoin and other cryptocurrencies to use for payments.
The Bottom Line
I hope the above information has helped you to know about the legal status of Bitcoin and other cryptocurrencies in some of the countries. If you want to invest or trade Bitcoin or cryptocurrencies, you need to know the legal status of your country.
Also, you should understand the tax laws and regulations before making any transactions in cryptocurrencies. If you have any queries, please share them in the comment section.