What are crypto regulations around the world?
The use of crypto exchanges is continuously increasing, and the regulations governing the cryptocurrency around the world are increasing and updated regularly. Since the cryptocurrency exchanges and bitcoin code platform aspects are continuously evolving in this case, it is not easy to stay aware of these revised rules in different global territories. Transformation in cryptocurrency from speculative/risky investment to a well-balanced portfolio helps to continue gaining momentum. Various governments around the world were also divided in their views on regulating the emerging crypto-asset class.
We’ve generated this guide to help you with the worldwide cryptocurrency regulatory arrangement, their stance on the legislation and associated activities. Let’s learn how different countries approach coin and exchange laws and if they have any upcoming regulations that could change their approach to cryptocurrencies.
Australia
In 2018, a new set of laws for digital currency exchange providers was imposed by the Australian Transaction Reports & Analysis Center (AUSTRAC), the AML/CTF regulator and the Financial Intelligence Agency. Accordingly, the companies are obliged to register and perform the KYC guidelines, report the suspicious transactions and comply with the AML regulations.
In December 2021, Australia reported that it would develop a framework based on licensing for cryptocurrency exchanges and check out to launch a retail CBDC for an overhaul of the payments industry. The Australian treasurer, Josh Frydenberg, mentioned that the government started consultation in early 2022, based on a licensing framework for digital exchanges that help the crypto-assets to be sold and bought by customers in a regulated environment.
The Australian government consulted on the regulation of businesses that hold crypto-assets for their consumers and on the usefulness of a central bank digital currency; he also stated that the applied taxes on cryptocurrencies in Australia are below a rate of 19-45% capital gains tax.
Canada
Canadian regulators typically take a proactive approach to crypto. Canada is the first country to approve a Bitcoin Exchange Traded Fund (ETF) for the 1st time on February 18, 2021 and the 2nd time on February 19, 2021, both on the Toronto Stock Exchange.
Also, the Canadian Securities Administrators (CSA) and the Investment Industry Regulatory Organization of Canada (IIROC) have mentioned that crypto trading networks and dealers must authorize themselves with provincial regulators. Canada also introduced the crypto investment companies as money service businesses (MSBs). The crypto platforms must be registered with the Financial Transactions & Reports Analysis Center of Canada (FINTRAC). From a tax point of view, Canada treats cryptocurrency like other goods.
The European Union (EU countries)
Cryptocurrency is legally allowed in almost all of Europe, while exchange laws depend on the European member states. Tax laws also differ depending on the member state of the EU, which usually ranges from 0% to 50%. The EU’s 5th and 6th Anti-Money Laundering Directives have been launched, hitting the KYC/CFT regulations for reporting requirements.
In recent years, the European Commission has promoted the Crypto-Assets Market’s Regulation (Mica), which is a framework that increases the security of customers, clearly states the rules of the crypto industry and initiated the new requirement for licensing.
Great Britain
Crypto exchanges should be registered with the Financial Conduct Authority (FCA) and comply with UK AML/CFT reporting laws and regulations. Although it does not provide specific guidelines for exchanges, the FCA rules mandated that firms dealing with crypto-assets should comply with the Terrorist Financing, Money Laundering and Transfer of Funds Regulations 2017 (MLR). The updates to these regulations were included in FATF’s guidelines in January 2020.
However, UK cryptocurrency laws may mainly align with the EU on a short-term basis, but change from the bloc to some extent in the coming years. In January 2022, the UK government stated plans for legislation addressing “misleading crypto-asset marketing” with the aim of bringing cryptocurrency to reject “in line with all other financial advertising.”
China
China does not classify cryptocurrency exchanges as legal tender, although they do classify them as property to determine inheritance. The People’s Bank of China (PBOC) banned crypto exchanges from operating in the country citing that they facilitate public funding without approval.
The world’s largest crypto exchange, Binance, was first launched in China, but later moved its headquarters following the country’s crypto regulation. The current location of Binance’s headquarters has not been disclosed, although people believe it has existed in Malta or the Cayman Islands.
