The battle regarding the legalization of cryptocurrencies has been going on forever. Cryptocurrencies, often termed as ‘digital currencies’ are famous for their digital transactions and to secure the transaction on the network, it uses cryptography. Bitcoin has been the primary cryptocurrency ever created and it was soon followed by a series of digital tokens including Litecoin, ETH or Ethereum, etc.
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- The battle of legalization within the nations:
As the largest digital currency of the world, the legality of Bitcoin varies from nation to nation. Although there are a number of different varieties available in the crypto market, Bitcoin has been successful in attracting the investors and their resources around the globe.
- Several developed nations with advanced economics are not yet sure about authenticating cryptocurrency such as Bitcoin as a medium of exchange.
- Bitcoin with its other fellow digital tokens have been able to win the trust and faith of corporations and large investors around the world, which has increased the regulatory hassle for cryptocurrencies everywhere.
- Being absolutely decentralized, cryptocurrencies are highly opposed by governmental institutions resulting in a ban on them.
- Several nations have accepted the benefits associated with Bitcoin and are ready to work with it.
- Whether mining cryptocurrencies, using them as authenticated legal tender or as a property, the regulatory rules regarding them greatly vary across all the nations of the world. Trading for beginners can be extremely chaotic and difficult, the bitcoin mining can be beneficial to the beginners.
- Nations where Bitcoin is legal:
- European Union – Bitcoin is legalized in almost every part of the European Union. There has been no clear legalization passed about the status of Bitcoin’s legalization but, Bitcoin has clarified that VAT and other taxes are not applicable in the conversion of fiat currency to Bitcoin.
- Transaction of products using Bitcoin are subjected to different taxes like the income tax, VAT, etc.
- In the EU, digital currencies and crypto assets are categorized as QFI or Qualified Financial Instruments.
- There is no prohibition provided under the EU law that stops banks, investors or other corporations from keeping cryptocurrencies, trading them or providing services using them.
- The USA – Bitcoin and other cryptocurrencies are legalized in the United States of America.
- As per the US treasury, in 2013, Bitcoin was listed as a convertible decentralized digital currency.
- The CFTC (Commodity Futures Trading Commission), in September 2015, declared Bitcoin as a commodity and it is taxed as a property by the IRS.
- The USA is way ahead of the other nations in the world in terms of digital trading with the trading volumes in digital exchanges at $1.5 Billion.
- South Korea – trading Bitcoin is authenticated in South Korea but, digital trading using cryptocurrencies is a restriction for minors and outsiders as well.
- Adults can transact cryptocurrencies in South Korea on registered exchanges by using their original identities and account at a financial institution in which such exchanges also have an account.
- The bank as well as the exchange has the responsibility to check the identity of the customer and implement different anti-money altering laws. The transaction volume using Bitcoin has significantly reached a height in South Korea.
- Japan – Bitcoin and other cryptocurrencies are acknowledged as a legal property by the payment services act in Japan, which is known to have the most dynamic regulatory environment for digital currency in the world.
- India – Bitcoin is not considered to be an illegal currency in India. The recent revolution regarding cryptocurrencies have made lawmakers consider the benefits associated with them.
- China – cryptocurrencies like Bitcoin are considered to be an illegal tender in the nation of China. The government has enacted several regulatory measures to cease any kind of events related to transactions of digital assets.
Although several countries have realized the benefits associated with Bitcoin, the regulation of Bitcoin as a currency has a long way to go. With further developments, cryptocurrencies will be globally accepted by every Nation.