Making Bitcoin (BTC) legal means that if someone wants to pay for a cup of coffee, they can use BTC to pay for it. Without a central bank declaring Bitcoin legal tender, the risk of accepting BTC for goods sold would fall on merchants. If the central bank has explicitly declared Bitcoin legal tender, then it becomes an official form of value exchange within the economy. On April 1, 2014, the PBOC ordered commercial banks and payment companies to close Bitcoin trading accounts in two weeks. [98] Financial institutions are not allowed to facilitate Bitcoin transactions. [14] In September 2014, the Bangladesh Bank stated that “anyone caught using the virtual currency could be imprisoned under the country`s strict anti-money laundering laws.” [78] The Autorité des marchés financiers (FMA) has warned investors that cryptocurrencies are risky and that the FMA does not monitor or regulate virtual currencies, including Bitcoin, or cryptocurrency trading platforms. [14]: 30–31 On March 12, 2017, the central bank changed its rules. With the new rules, broad and general exceptions to the restrictions of the Foreign Exchange Law No. 87/1992. [177] As of 2013 [update], the UK government has stated that Bitcoin is not regulated and will be treated as a “foreign currency” for most purposes, including VAT/GST. [3]: United Kingdom The Autorité des marchés financiers, the financial regulator of the province of Quebec, has stated that certain business models related to Bitcoin, including exchanges and ATMs, will be regulated under its current MSB law. [30] While some states have explicitly allowed their use and trade, others have banned or restricted them.

Similarly, various government agencies, departments, and courts have classified cryptocurrencies differently. The Swedish tax authority issued a preliminary ruling on value added tax (VAT) on bitcoins and found that bitcoin trading is not subject to Swedish VAT, but is subject to the rules of Finansinspektionen (financial supervisory authority) and is treated as currency. The Swedish tax authorities appealed against this decision. [3]: Sweden Bitcoin and cryptocurrencies are generally welcome in most parts of the world. Nevertheless, some countries have even banned them or their use. Whether the bans are due to the decentralized nature of bitcoins, the threat to their current financial system, or simply the fact that the right regulations have yet to be approved, at least nine countries have chosen it. These are: In 2013, the Bank of Portugal stated that Bitcoin was not a safe currency because its issuance had no oversight or regulatory requirements. In 2014, Portugal did not have a specific legal framework for Bitcoin. [3]: Portugal As a general rule, there are macroeconomic factors that a country wishes to address by adopting a currency as legal tender. For Bitcoin to be legal tender, these factors must align with visionary leadership.

Bitcoins can be considered money, but not legal tender. A bitcoin may be considered a commodity or item under the Argentine Civil Code, and transactions involving bitcoins may be subject to the rules governing the sale of goods under the Civil Code. [3]: Argentina On May 5, 2022, Argentina`s central bank banned financial institutions from facilitating cryptocurrency-related transactions. [49] Bitcoin can be used anonymously to transact between account holders worldwide. This has created monetary concerns for governments. While some legislators and officials may not support its use due to a lack of control and illegal connections, many have introduced regulations under their countries` anti-money laundering and combating the financing of terrorism (AML/CFT) laws to reduce its use for these purposes. The Norwegian tax authority stated in December 2013 that it did not define Bitcoin as money, but considered it an asset. Profits are subject to wealth tax. In business, the use of Bitcoin falls under VAT regulations. [179] Cryptocurrencies made a notable debut in 2009 with Bitcoin.

With Bitcoin, the world stumbled upon a peer-to-peer digital currency that guaranteed many conclusive benefits for the transformation of finance. However, the legality of cryptocurrencies remains questionable for various reasons. Searching the list of legal countries for cryptocurrencies in 2022 would help you see how many countries have made a good start in cryptocurrency adoption. Regulation remains an ambiguous concept in the world of cryptocurrencies, with no universal framework for the use of crypto-assets. The following discussion gives an overview of the top countries that have embraced cryptocurrencies by overcoming the uncertainties of crypto regulation. Texas could also soon switch legal tender to Bitcoin. Governor candidate Huffines has said he will try to make Bitcoin legal in his state if he wins the election, various media outlets reported. Financial institutions are not allowed by the central bank to facilitate Bitcoin transactions. [14] In April 2018, the Central Bank of the Islamic Republic of Iran issued a statement banning the country`s banks and financial institutions from handling cryptocurrencies, citing money laundering and terrorist financing risks. [77] The legal status of cryptocurrencies varies considerably from jurisdiction to jurisdiction and is not yet defined or changing in many of them. [1] While the use of cryptocurrency per se is not illegal in most countries, its status and ease of use as a means of payment (or commodity) varies with various regulatory implications.

[2] Estonia is also one of the leading competitors among countries using cryptocurrency with simpler privacy laws and crypto regulations. The relaxed regulatory environment for crypto in Estonia could offer conclusive advantages to revolutionize the economy by attracting top tech companies. This is one of the most popular decisions among countries that allows crypto companies to operate safely without legal complications. At the same time, Estonia is also on the fast track to launch its national cryptocurrency Estcoin. The country`s financial services sector is also showing greater support for the use of cryptocurrencies, with Estonian bank LHV Bank being the first example of blockchain technology adoption. Germany`s unique approach to cryptocurrencies is a valid reason to add them to this list. Germany views cryptocurrencies as private money, unlike many other countries that adopt cryptocurrency as an asset. Long-term investors could find a safe haven in Germany to be exempt from long-term capital gains tax. Therefore, people holding cryptocurrency for more than a year would benefit from capital gains tax exemptions. In addition, Berlin has also become a hub for many popular blockchain companies such as EOS.

Countries that use currencies linked to Western economies have little or no say in economic policy. This is one of the main reasons why El Salvador has taken a similar step.