Cryptocurrency has become a big part of the global financial system as it is increasingly incorporated with other business sectors. Governments worldwide are still figuring out how to deal with its rising popularity.
Some countries like China or India are trying to do everything they can to stop further development of blockchain technology in their economies. However, more governments are opening up to the emerging sector and its advantages, improving legislation for cryptocurrencies and their roles as both an asset and a utility.
Creating the right kind of regulations and crypto policies is essential in creating an environment where this new technology could prosper. Here are the countries that are leading in cryptocurrency adoption.
The Mediterranean island is one of the biggest cryptocurrency hubs in the world. Apart from being the place for some of the world’s most significant blockchain technology events, its government has implemented crypto policies that help businesses operate in cryptocurrency.
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In 2018, the Maltese parliament passed three blockchain and cryptocurrency acts and gave investors a clear description of the legal requirements for establishing a viable cryptocurrency firm. As a result, many cryptocurrency enterprises have established offices on the island.
It seems that Malta is heading in the direction where cryptocurrency is the inevitable future of money. It was one of 8 EU countries that committed themselves to the promotion of cryptocurrency adoption, and its government is constantly advocating for further adoption in front of international organizations such as the UN General Assembly.
However, Malta is still lacking clear tax regulation of cryptocurrency which allows for the risk of money laundering schemes. It is somewhat surprising that Malta still doesn’t have a special law that oversees crypto taxation given the government’s attempts to create a crypto-friendly atmosphere. Despite this, the thorough regulation of other “commercial elements” continues to draw numerous companies to the country.
Brazil has been one of the countries that have recently implemented crypto policies and are looking into different options for reforming their economic system. Sao Paolo is one of the biggest tech hubs in the world as many blockchain startups and tech events find their home in the Brazilian megalopolis.
It is no wonder that the Brazilian government is focused on digitalization. The government started an initiative called “the Real Digital Project” which aims to digitize the Brazilian Real by the end of 2022. The Latin American country is still adopting and cognizant of the full potential of crypto tech
This November, Brazil has taken further steps into embracing cryptocurrency. New legislation concerning Bitcoin and other cryptocurrencies in Brazil was passed by the Brazilian government. Bitcoin, known for its digital value, has been included in the “virtual assets” industry to which the new regulation is applicable.
Bitcoin has received government approval, both as a payment method and as a digital commodity for investment. The main goal of the bill is to create an authoritative entity that will oversee the crypto market and this responsibility will be in the hands of the Central Bank of Brazil and the Securities and Exchange Commission.
Furthermore, it emphasizes that certain regulations must be followed and that only bitcoin service providers that have received formal approval from the federal government are allowed to operate in Brazil. Additionally, the legislation aims to recognize various providers according to their roles in trading, transfer, custody, and administration.
We don’t have to go too far to find the next cryptocurrency pioneer. There were several occurrences in 2019 that put Argentina at the forefront as the breeding ground for cryptocurrency adoption. It all started with the partnership between Bitex and Alto Viaje (a platform for adding funds to the public transport card), so passengers could pay in BTC for their public transport needs.
Because this project was a huge success, the Argentinian government decided to take cryptocurrency one step further. They made a trade deal with Paraguay in which Paraguay paid for pesticides and fumigation products in BTC, which was the first cryptocurrency deal for both countries. Having international arrangements be conducted in Bitcoin as the main currency is groundbreaking and Argentina might be the first of many countries that will implement it in future global trade.
The South-American country is also a big breeding ground for blockchain startups, further developing the sector in the country. Binance has developed a partnership with the city of Buenos Aires in which they will finance blockchain projects and startup companies to promote this growing sector.
Although there are no legislative crypto policies, these initiatives tell a lot about the government’s attitude towards cryptocurrency and blockchain technology. Every blockchain initiative financed by Binance will get a matching contribution from the nation’s Ministry of Production and Labor of up to $50,000. Pretty good incentive to boost engagement in the Argentinian fintech sector.
In conclusion, the aforementioned governments are only a few of those that saw the future potential of cryptocurrencies and chose to “take the risk” of adopting them through crypto policies. I hope that their innovative steps will open the door for other nations to accept blockchain technology, which will result in the widespread acceptance of cryptocurrency.