Bitcoin in Brief Thursday: OECD Explores Cryptocurrencies, Central Asian Powerhouse Calls for UN Crypto Rules

Bitcoin in Brief Thursday: OECD Explores Cryptocurrencies, Central Asian Powerhouse Calls for UN Crypto Rules

In today’s edition of Bitcoin in Brief we’re focusing on developments in the realm of international politics and economics regarding cryptocurrencies. The Organization of Economic Cooperation and Development is looking into the possible uses of digital coins and the associated technologies. Kazakhstan is calling for the adoption of common crypto rules by the United Nations, while Iran and Russia are thinking about using cryptocurrency in bilateral trade.  

Also read: Bitcoin in Brief Wednesday: Coinbase Goes After Big Money as Nomura Creates Komainu

OECD Explores Cryptos and ICOs

Bitcoin in Brief Thursday: OECD Explores Cryptocurrencies, Central Asian Powerhouse Calls for UN Crypto RulesThe Committee on Digital Economy at the Organization of Economic Development and Cooperation (OECD) has started exploring blockchain-based cryptocurrencies and Initial Coin Offerings (ICOs). The international body also wants to help governments of member-states develop and implement legislation aimed at protecting consumer rights in electronic trade.

According to Elina Sidorenko, head of Russia’s interdepartmental group working to assess risks and opportunities associated with cryptocurrencies, the OECD will be used as a platform to discuss matters related to cryptos and token sales. These discussions will be held in the context of ensuring the safety of consumers of financial services, she said in a post on her Telegram channel.

The OECD and the Financial Action Task Force on Money Laundering (FATF) recognize the role of cryptocurrency as a means of payment and accumulation, Sidorenko emphasized. Both organizations also view ICOs as a good mechanism to attract funding, she added. “I hope that the generally positive rhetoric on cryptocurrencies in the OECD will not change,” the Russian official said, promising to keep her followers informed on further developments.

Astana Calls for UN Crypto Rules

Kazakhstan’s President Nursultan Nazarbayev thinks that the time has come to adopt common, international rules on cryptocurrencies with the help of the United Nations. “Most countries are actively exploring the possibility to adapt their regulations to the current configuration of the financial system. At the same time, the disconnected actions of different states will lead to inefficiency. It is necessary to develop general rules,” he insisted, quoted by Zakon.kz.

During the Astana Economic Forum, Nazarbayev noted that Kazakhstan’s own project to issue an assets-backed cryptocurrency called G-Global has won institutional support from international organizations. The initiative “has been mentioned on multiple occasions during the G20 summit. Last week the Council of Foreign Ministers at the Organization of Islamic Cooperation, which includes more than 50 nations, adopted a resolution to support it,” the president revealed.

Bitcoin in Brief Thursday: OECD Explores Cryptocurrencies, Central Asian Powerhouse Calls for UN Crypto Rules

Kazakhstani officials have previously said that G-Global will be designed as a crypto “backed by assets, not just trust.” These assets have not been specified so far but the Central Asian country is rich in natural resources. Kazakhstan is the leading economy in the region, generating 60% of its GDP, primarily through the oil and natural gas industry.

Recent reports that Kazakhstan’s central bank is preparing legislation to ban the sale and purchase of cryptocurrencies, as well as crypto mining, have been dismissed by representatives of the local crypto community. According to Leonid Muravjov, VP at the Blockchain and Crypto Technology Association of Kazakhstan, the government is actually spending huge amounts of money to digitize the economy, which is currently heavily reliant on the export of mineral resources.

Kazakhstan and Belarus to Cooperate on Blockchain

Bitcoin in Brief Thursday: OECD Explores Cryptocurrencies, Central Asian Powerhouse Calls for UN Crypto RulesAstana and Minsk intend to strengthen their ties in the field of blockchain implementation. Kazakhstan and Belarus have signed a memorandum of cooperation that will allow experts from the two former Soviet republics to exchange experience and improve their competitiveness on the world stage through wider adoption of new technologies. Both countries are members of the Eurasian Economic Union (EAEU).

“The bottom line is that this (blockchain) is a multinational technology, and the development of some real solutions, both at state level and in the private sector, does not make sense in the context of a single state. The memorandum aims to develop the most optimal solutions through exchange of experience and personnel, and to share already working solutions based on blockchain technologies and cryptocurrencies,” said Stanislav Baskov, Director of the Belarussian Distributed Ledger Technologies Association.

According to a press release by Astana Hub, Kazakhstan’s IT Park, the agreement was signed during the international expo TIBO – 2018 in Belarus. It would allow Kazakhstan to take advantage of the Belarusian experience in blockchain and cryptocurrency integration. Recently, Minsk legalized crypto-related activities for entities registered with its Hi-Tech Park with a presidential decree that came into force on March 28.

Iran and Russia to Create Crypto Alternative to SWIFT

Recognizing the opportunity to minimize dependence on the US dollar, Iranian authorities have turned their attention to cryptocurrencies. Iran’s central bank has commenced work on proposals to use cryptocurrency in international trade, as requested by the parliamentary Committee on Economic Affairs, Interfax reported.

Bitcoin in Brief Thursday: OECD Explores Cryptocurrencies, Central Asian Powerhouse Calls for UN Crypto Rules“Cryptocurrencies offer a good opportunity to circumvent the use of the dollar, and also replace the SWIFT system,” said Mohamad Reza Purebrahimi, who heads the commission. Teheran has established cooperation with Russia on the matter following a meeting with the chairman of the Economic Policy Committee of the upper house of Russia’s parliament, Dmitriy Mezentsev. Purebrahimi said that the two countries may be the first to use cryptocurrency in bilateral trade transactions.

“Against the backdrop of US pressure, the expansion of settlements in national currencies, as well as the possible use of payment systems like [the Russian] Mir and the Iranian Shetab is promising,” Mezentsev commented. According to official sources quoted in Moscow, Russia may put its version of SWIFT, the SPFS, on blockchain as early as next year.

What are your thoughts on the highlights in today’s Bitcoin in Brief? Tell us in the comments section below.


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Major Belarusian Bank Starts Offering Bitcoin CFD as Belarus Gets Less Crypto Friendly

Major Belarusian Bank Starts Offering Bitcoin CFD as Belarus Gets Less Crypto Friendly

A well-known bank in Belarus will begin offering a bitcoin contract for difference (CFD) product through its platform, a joint project with a Swiss bank. Meanwhile, Belarus is growing less crypto friendly, reportedly amending its decree to impose strict KYC rules.

Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space

New Bitcoin CFD Product

Major Belarusian Bank Starts Offering Bitcoin CFD as Belarus Gets Less Crypto FriendlyMtbankfx is an accredited FX dealer and the first banking forex platform in Belarus. Launched in July 2016, it is a joint project between Minsk Transit Bank (Mtbank), one of the most well-known banks in Belarus, and Swiss Dukascopy Bank SA.

Major Belarusian Bank Starts Offering Bitcoin CFD as Belarus Gets Less Crypto FriendlyThe platform will start offering a bitcoin CFD product next week, according to local media. It has already added information and updated its terms of service to reflect this new offering.

Mtbankfx explains in its terms of service that its tools, including the BTC/USD tool with 1:3 leverage, are “available for transactions around the clock – from the opening of the market on Sundays at 21:00 GMT in the summer (22:00 GMT in the winter) until the market closes on Fridays at 20:00 GMT in summer/winter time.” For the bitcoin CFD specifically, the company wrote:

All open positions as of 20:00 GMT Fridays will be forcibly closed.

While the platform offers CFDs for many underlying assets, the bitcoin CFD is the only one that will be forcibly closed.

On March 29, Switzerland’s Dukascopy Bank SA launched its own BTC/USD CFD product for European clients. “Bitcoin to US Dollar (BTC/USD) with leverage 1:3 has been added for live trading,” the company stated.

Belarus Becoming Less Crypto Friendly

Major Belarusian Bank Starts Offering Bitcoin CFD as Belarus Gets Less Crypto Friendly
Alexander Lukashenko.

Belarusian president Alexander Lukashenko signed the decree “On the development of the digital economy” in January that legalized cryptocurrencies, initial coin offerings, and smart contracts. The decree went into effect in March.

However, local media reported this week that amendments to that decree are already being prepared to obligate cryptocurrency exchanges operating within the High-Tech Park (HTP) to disclose their data and identify customers.

Ria Novosti’s source explained that “beneficiaries must meet the requirements for reputation” such as having no criminal record and no bankruptcy proceedings against them, in whole or part. “They should [also] show the availability of funds in accounts of at least $5 million and confirm the sources of their origin.” Additionally, Forklog elaborated:

Operators are required to identify the clients of the exchanges, as well as record and store all types of communications with them. In certain cases, exchange-residents of the HTP will be required to conduct customer verification procedures.

The news outlet added, “information about customers and their transactions should be stored at crypto exchanges for at least five years.”

Do you think Belarus will become even less crypto friendly? Let us know in the comments section below.


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Bitcoin in Brief Monday: A Panther’s Moonshot Bet

Bitcoin in Brief Monday: A Panther’s Moonshot Bet

Bitcoin in Brief today is slanted toward a crypto winter slowly thawing, as Pantera Capital bets on a moonshot price point. Also, the world’s most popular decentralized digital asset has been forked more than a plate of good pasta; there’s a growing list of countries who’re less likely to nab your crypto profits; Yahoo! smashes rumors; and a good-hearted wager between bitcoin core and bitcoin cash partisans exemplifies how ecosystem actors should treat one another.

Also read: Bitcoin in Brief Saturday: Hide Your Seed

A Panther’s Moonshot

Bulls have a panther as their advocate to help thaw this crypto winter. We reported this week, “Pantera Capital, an investment firm exclusively operating in the cryptocurrency and distributed ledger technology sectors, has published a letter predicting that bitcoin has established the low for its current bear market. Pantera cites a number of factors as informing its market outlook.”

Bitcoin in Brief Monday: A Panther’s Moonshot Bet

Among those factors are taxes on capital gains, where estimates are in the many, many billions expected from enthusiasts. That in turn, the fund theorizes, dragged prices down, and bitcoin core has found a bottom at $6,500, as holders were forced to sell in order to pay government bills. We continue, “Pantera also states that ‘It’s highly likely’ for the price of bitcoin to exceed its previous record highs of $20,000 ‘within a year,’ asserting that ‘A wall of institutional money will drive’ the growth in price.”

Speaking of Taxes

Until that prediction comes true, readers should pack their bags to save money from the tax man! Start looking for places to stay in Germany, Slovenia, Denmark, Belarus, South Korea, Singapore, as they’re some of the most advantageous.

Bitcoin in Brief Monday: A Panther’s Moonshot Bet

We stressed how many “jurisdictions have yet to update their tax laws to encompass cryptocurrencies. Rules governing taxation are often incoherent and very different even in countries that are part of a common space. In the European Union, for instance, tax rates in member-states vary between 0 and 50%.”

Forking Crazy

Be honest. You’ve never heard of Bitcoin Minor, Bitcoin King, nor Bitcoin Boy. How many times would you guess the Bitcoin network has been forked? During an extensive and really interesting investigation, we revealed nearly 70 times. That’s right, 70.

We summarized findings as how forking “bitcoin used to be a rarity. Then it became the norm. And then it became a meme, with anyone and everyone forking bitcoin on a weekly basis. There have now been a total of 69 bitcoin forks plus another 18 altcoin forks. Holders of bitcoin, monero, ethereum, and litecoin can claim almost 80 additional coins for free. Whether it’s worth their time to do so, however, is another matter.”

The Fork of All Forks Remains a Solid Option

The most famous of forks is, of course, bitcoin cash (BCH). Its being faster, sleeker, younger, and bigger (block wise) has lead those on the bitcoin core (BTC) side to take a stance on BCH’s long term viability. And while each side feels passionate about its coin, and the future that it entails, debate often become rancorous, turning everyone off.

Bitcoin in Brief Monday: A Panther’s Moonshot Bet
A reader responds to a hilarious bet.

We reported how two well-known advocates joked and ribbed one another about Core’s anticipated Lightning Network solution. They bet bragging rights if a demonstration of the solution failed a basic transaction. Loser would have to wear a t-shirt of the winner’s coin. Regardless of which won, the import is how the two men exchanged laughs and good humor, and the ecosystem needs more of both.

Japan Continues to Lead

No laughing matter is how the crypto winter continues its thaw as “Yahoo! Japan has confirmed that it is entering the crypto space by acquiring a stake in a Japanese cryptocurrency exchange that is already licensed by the country’s financial regulator. The company plans to launch a crypto exchange in the fall of this year,” we explained.

Bitcoin in Brief Monday: A Panther’s Moonshot Bet

We Have the Best Readers in All of Crypto

Thanks to our readers liking and sharing, our post on aspects of Islam possibly opening to cryptocurrency was picked up and republished and referenced around the world. Some contend it was the root cause of bitcoin’s recent price rebound. Great job, gang.

The crazy good book by Wendy McElroy we continue to serialize brings in wonderful reader comments and observations. To wit:

Bitcoin in Brief Monday: A Panther’s Moonshot Bet

Do you think bitcoin will continue to rise or to fall to new lows? Let us know in the comments section below.


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These Countries Won’t Tax Your Bitcoins Too Much

These Countries Won’t Tax Your Bitcoins Too Much

A growing number of governments can’t resists the temptation to get their hands on some of the bitcoins their citizens are making. Several states, however, think that leaving some breathing space for crypto users and entrepreneurs is a better idea in the long run. Crypto-friendly tax regimes can still be found around the world.

Also read: Tax Paying Americans Owe $25 Billion in Cryptocurrency

Tax Exemptions Offered Here:

Germany, Europe’s economic locomotive, has been quite careful with crypto taxation. Last month the Federal Ministry of Finance issued a notice which treats bitcoin as a currency. The Bundesrepublik is not going to tax cryptos when exchanged with euros. Purchases with bitcoin are subject to VAT, just like any other. No tax will be imposed, however, on long-term investments in cryptocurrency. If a trader sells a bitcoin more than a year after its purchase, the profit is exempt from taxation. The same applies to yearly profits of less than €600.

These Countries Won’t Tax Your Bitcoins Too MuchCapital gains of individual investors trading cryptocurrencies are not taxed in Slovenia. Its residents are not required to report them in their income tax returns. However, private individuals who receive their income in cryptocurrency, are obliged to declare the digital money and pay regular income tax. The country uses a progressive scale and rates vary from 16% on incomes of less than €8,000 a year to 50% on incomes exceeding €70,000.

Tax authorities in Denmark have said that fintech companies should pay taxes just like any other business. On the other hand, individual investors trading cryptos do not owe any tax on their gains.

Belarus has created a friendly environment for crypto investors, both corporate and private. Activities like mining, issuing, and trading coins were legalized in March. A presidential decree introduced tax exemptions for crypto incomes and revenues for a period of five years.

These Countries Won’t Tax Your Bitcoins Too Much

Gains from cryptocurrency transactions are still tax free in South Korea. The Finance Ministry and the tax authorities in Seoul are working on a legislation that is likely to change the situation. The new tax bill should be adopted in the first half of this year, according to officials. No concrete time frame has been set.

Buying bitcoin will save you taxes in Singapore. Digital coins are not considered commodities there and are not recognized as currencies. In the absence of special requirements, gains from crypto investments of private individuals are not taxed. Companies trading cryptocurrencies, however, are expected to pay taxes on their profits.

Incoherent Rules Govern Crypto Taxation

These Countries Won’t Tax Your Bitcoins Too MuchMany jurisdictions have yet to update their tax laws to encompass cryptocurrencies. Rules governing taxation are often incoherent and very different even in countries that are part of a common space. In the European Union, for instance, tax rates in member-states vary between 0 and 50%.

The Eurasian Economic Union is another example, with Belarus exempting crypto transactions from taxation, while Russia is collecting 13% tax on crypto incomes and 24% corporate tax on profits.

The situation in the US is also complicated. Several states have taken steps to become crypto-friendly jurisdictions. Wyoming passed a bill exempting cryptocurrencies from property taxation. Two other states want to legalize bitcoin as a payment option for tax purposes. Arizona has promised to become the first US state to start accepting taxes in cryptocurrency. Georgia may also allow its residents to pay taxes in bitcoin.

What taxes on crypto incomes and profits do you have to pay in your country? Tell us in the comments section below.


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The post These Countries Won’t Tax Your Bitcoins Too Much appeared first on Bitcoin News.

Crypto Business Is Now Legal in Belarus

Crypto Business Is Now Legal in Belarus

Crypto-related activities are now considered legal in Belarus. The presidential decree “On the Development of the Digital Economy” came into force on March 28. The country aims to become a global IT hub luring entrepreneurs from around the world with a business-friendly environment. Unprecedented freedoms and generous incentives are enticing crypto companies to invest in the former Soviet republic.

Also read: Belarus Adopts Crypto Accounting Standard

Crypto Activities Are Free, Tax-Free

Belarus, a country that suffers from a bad reputation with politicians in the West, is now set to improve its image with western businessmen. On Wednesday, the close ally of Moscow, also called the last dictatorship in Europe, became a European leader as far as crypto freedoms are concerned. Comprehensive regulations, largely legalizing the crypto sector, are now officially in place.

Crypto Business Is Now Legal in Belarus
Belarus High-Tech Park

Decree №8, signed by President Alexander Lukashenko in December, entered into force on March 28 to create conditions for the development of the digital economy in Belarus. It effectively legalizes crypto business activities, like exchange services, initial coin offerings, mining operations, smart contracts. The document does not restrict the issuing, storage, and trade of digital tokens. Individual entrepreneurs and corporate entities from the crypto industry are free to do business anywhere, as long as they register as residents of the Belarus High Technologies Park (HTP).

Lukashenko’s decree introduces tax breaks and other incentives for crypto businesses until January 1, 2023. No taxes will be imposed on companies that profit from mining, issuing and placement of digital coins. The same applies to crypto-related income of private individuals from mining and trading cryptocurrencies. In the next five years, even crypto firms based abroad will not be taxed.

The new regulations include measures to simplify procedures regarding foreign trade and the hiring of foreign nationals by the residents of the Hi-Teck Park. Employees and investors in the HTP will not be required to apply for work permits. They will also benefit from a special visa waiver regime and will be granted temporary residence status in Belarus.

Comprehensive Regulations Adopted

An array of legal changes accompany the Decree “On the Development of the Digital Economy”. This week Belarus implemented a new standard aimed at adjusting its accounting practices to address cryptocurrencies. It classifies “digital tokens” as cryptos in the new provisions, according to their acquisition and intended use. Authorities have defined the information crypto companies and entrepreneurs are required to share. The National Chart of Accounts has been amended.

Crypto Business Is Now Legal in Belarus
The National Bank of Belarus

The central bank of Belarus has also implemented changes. They concern the oversight of commercial banks and other financial institutions and introduce new requirements for the internal control procedures. According to the government press service, the new rules aim to prevent the legalization of illicit incomes, terrorism financing and the proliferation of weapons of mass destruction. Officials claim the regulations are intended to perfect anti-money laundering measures and improve cybersecurity.

Taking into account all challenges, Minsk has decided to create a special Council for the Development of the Digital Economy. It is tasked with coordinating the digitization and the development of the information and communication sectors. The council is chaired by Prime Minister Andrei Kobyakov. Furthermore, President Lukashenko spoke about the creation of a Ministry of the Digital Economy, and voiced his support for the idea. The new department may be set up as early as this year.

Belarus to Make the Most of It

Crypto Business Is Now Legal in Belarus
Alexander Lukashenko

Alexander Lukashenko has stated many times that his country needs to learn how to benefit from the development of the information and communication technologies. In December, the Belarusian leader said the country’s IT industry needs a new impulse. “Belarus should become attractive for talented people and successful companies,” he insisted, quoted by RIA Novosti. Belarus has what it takes to develop artificial intelligence, big data and blockchain technologies, he added.

Lukashenko said he had no intentions to slow down the progress but warned entrepreneurs they should not forget the state and its interests. “Let’s work together for this piece of land. I will guarantee you stability and non-interference,” he promised.

Belarusian authorities have registered unprecedented interest from crypto businesses since the signing of Decree №8. The government in Minsk announced that the number of new registrations with the High-Tech Park increased by about a quarter in 2018. Residents of the High-Tech Park now work in 67 markets around the world.

While the new regulations create favorable conditions for foreign investments and technological development, critics point out that Belarus may become just another offshore zone, a crypto-friendly one. The question when ordinary Belarusians will be able to receive their salaries in bitcoin and pay their bills with cryptocurrency, remains unanswered, for now at least.

Do you think other countries in Europe will follow Belarus and adopt their own comprehensive regulations for the crypto industry? Share your expectations in the comments section below.   


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Belarus Adopts Crypto Accounting Standard

Belarus Adopts Crypto Accounting Standard

Days before legalizing crypto activities, Belarus has adopted a new accounting standard that deals with cryptocurrencies. It classifies digital tokens according to their acquisition and intended use. The document defines the information companies will be required to share with authorities. The presidential decree regulating the crypto sector comes into force on March 28.

Also read: More Belarusians Search “Crypto”, Question “Legalization”

Goods, Investments, Settlements

The Ministry of Finance in Minsk has developed a new standard that specifies the procedures for keeping accounting records of crypto transactions. The document does not explicitly mention cryptocurrencies, which are not regarded as legal tender in Belarus. Nevertheless, it effectively regulates the reporting of cryptocurrency flows.

Belarus Adopts Crypto Accounting StandardThe obligations of organizations conducting token sales and the exact approaches to assessing the cost of “digital tokens” are also defined in the Ministry’s decree. The rules apply to private entities and not the state-owned banks or government institutions, the department clarified in an announcement quoted by Belta news agency.

The new standard classifies cryptos according to their acquisition and their intended use. Tokens acquired through initial coin offerings (ICOs) are referred to as investments. They should be debited as either “Long-term financial investments”, if their circulation period exceeds 12 months, or as “Short-term financial investments”. Their amounts must be credited in the accounting balance under “Settlements with different debtors and creditors” and “Other income and expenses”.

If the tokens are purchased for subsequent sale, by a trader or an exchange, they have to be reported in the “Goods” debit account and under the following credit accounts: “Settlements with suppliers and contractors” and “Income and expenses for current activities”. Digital tokens acquired as a result of mining operations or as remuneration for verification of crypto transactions are to be recorded under the “Finished goods” debit account and also as “Main activities” in the credit section of the balance.

Other Regulations Changed

Amendments have been made to several other standards of the National Chart of Accounts. These concern the individual accounting statements and the consolidated financial statements. The Finance Ministry has determined the data companies working with tokens are required to disclose in their accounting records. The information should include the amount and type of tokens in possession, as well as their initial value as calculated at the end of the previous year.

Belarus Adopts Crypto Accounting Standard

Decree №8 “On the development of the digital economy” was signed by President Alexander Lukashenko in December. It legalizes crypto activities, creating conditions for exchange services, initial coin offerings, and cryptocurrency mining operations. The document introduces tax breaks and other incentives for crypto businesses until 2023. It will come into force on March 28, 2018.

With its implementation, Belarus is set to become arguably the first jurisdiction with a comprehensive legal framework regulating the blockchain industry. The decree does not imply restrictions or any special requirements for issuing, placement, storage, and exchange of digital tokens.

Individual entrepreneurs and corporate entities will be free to do crypto business in the country provided they register as residents of the Belarus High Technology Park (HTP). At the same time, the use of cryptocurrencies is expected to remain somewhat limited, as they will not be accepted as legal means of payment.

Do you think that the legal status of cryptocurrencies in Belarus will change in the future? Share your expectations in the comments section below.  


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0 to 50% – Time to Pay Crypto Taxes in the European “Union”

0 to 50% – Time to Pay Crypto Taxes in the European “Union”

With the increasing popularity of bitcoin and the like, this year’s tax campaign in Europe comes with many questions on how to report and pay crypto taxes. Despite the obvious hesitation on the part of many governments to comprehensively regulate/legalize the sector, cryptocurrency incomes and profits “enjoy” special attention. Different decisions on the matter pose different challenges to citizens of individual member-states.

Also read: Excessive Crypto Regulation Not Optimal, EU Banking Authority Says

Different Approaches

There is no uniform approach towards cryptocurrencies in any region and Europe is no exception when it comes to taxation. The recently held G20 summit proves no global consensus on the status of cryptocurrencies, and each jurisdiction is expected to take its own decisions in the short run. In the absence of pan-European guidelines on how to treat crypto-related incomes and profits, some member-states follow a decision by the Court of Justice of the EU. In a 2015 ruling on the application of value added tax (VAT) to cryptocurrencies, the Luxembourg-based institution set a precedent. It basically drew a parallel between “virtual currencies” and fiat money, when digital coins are used for payments.

0 to 50% – Time to Pay Crypto Taxes in the European “Union”In accordance with that decision, Germany’s Federal Ministry of Finance recently announced that bitcoin should not be subject to VAT, when exchanged with fiat. The tax is applicable only when goods and services are paid for in cryptocurrency. According to German authorities, exchanges can enjoy tax breaks when they trade cryptos, and crypto mining should not be taxed. Trading cryptocurrencies by individuals, however, is subject to standard capital gains tax. Profits of less than €600 and gains from long term holdings (over one year) are exempted.

Several other governments have adopted similar rules. Estonia subjected digital currencies to capital gains tax and VAT. Authorities in Tallinn view cryptos as both means of payment and investments. Slovenia does not tax capital gains of individual investors trading cryptocurrencies, as they are not considered part of their income. Crypto incomes, however, for both individuals and businesses, should be reported and taxed. Applicable rates depend on the annual income and vary from 16% for less than €8,000 to 50% for incomes over €70,000 a year.

Tax authorities in Denmark have announced that crypto companies will be taxed as any other business. According to the Financial Services Authority, private individuals trading cryptocurrencies will not be required to pay taxes. The agency called for adopting legislation that regulates cryptos and their taxation. Spain is mulling tax breaks for businesses using blockchain technologies and cryptocurrencies. The exact scope of the exemptions is yet to be determined, but the ruling People’s Party has introduced a bill to offer incentives for small companies in the crypto sector.

Waiting for Brussels’ Decision

0 to 50% – Time to Pay Crypto Taxes in the European “Union”A number of EU countries are still waiting for a common, European approach towards cryptocurrency taxation. The government in Belgium, which is home to many EU institutions, has not issued an official stance on the matter. Nevertheless, recent reports suggest that tax authorities are going after Belgian citizens trading cryptocurrencies on foreign exchanges. Anyone speculating on crypto markets is expected to pay 33% tax on their gains, despite the fact that cryptocurrencies are not regulated. Belgians should declare them as “other income” on their tax returns, the Special Tax Inspectorate said at the end of last year.

Bulgaria is another member-state expecting guidance from Brussels. The National Revenue Service has issued a clarification notice saying 10% capital gains tax is applicable to profits from buying and selling cryptocurrencies. Their legal status, however, is yet to be determined by the Bulgarian parliament. It remains unclear how bitcoin incomes and purchases with cryptocurrency will be taxed.

Other EU member-states are losing patience. Dutch finance minister recently described the current regulatory framework as “insufficiently equipped”, as news.Bitcoin.com reported. Wopke Hoekstra spoke of the “inherently cross-border” nature of cryptocurrencies and called for “coordinated international approach”. The government in the Netherlands insists on adopting new European regulations by the end of next year, including amendments to the anti-money laundering directive, which also deals with tax evasion.

The European Neighborhood

While EU regulators are still struggling to grasp the crypto phenomenon, other countries in Europe have taken advantage of their non-aligned status. Belarus, for example, is fighting political and economic isolation by embracing crypto. A decree, signed by President Lukashenko, introduces tax breaks and other incentives for crypto-related activities until 2023. It enters into force in less than a week, on March 28. Whether this crypto-friendly policy will fill government coffers at the end of the day remains to be seen.

How are crypto incomes and profits taxed in your country? Tell us in the comments section below.


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More Belarusians Search “Crypto”, Question “Legalization”

More Belarusians Search “Crypto”, Question Legalization

Interest towards cryptocurrencies in Belarus has increased significantly in the past year. Topics related to bitcoin, mining, and blockchain have been popularized by media. Belarusians are searching for more crypto information online, but there are some key questions search engines are unable to answer: Will ordinary citizens benefit from the upcoming legalization? Are they going to be able to receive salaries and pay bills in bitcoin? Concerns are growing that Decree №8 may simply turn Belarus into a “crypto-offshore”.

Also read: New Plant to Assemble Mining Rigs in Belarus

Cryptocurrency Searches Spike in Belarus

Politically and economically isolated from the West, Belarus has been labeled “Europe’s last dictatorship”. However, last year Minsk made a strategic decision to embrace crypto, surprising many of its critics. In December, President Lukashenko signed Decree №8 to legalize cryptocurrencies, initial coin offerings, and smart contracts. It enters into force on March 28 and introduces tax breaks and other incentives for crypto-related activities until 2023, in order to develop the local digital economy.

More Belarusians Search “Crypto”, Question LegalizationInterest towards cryptocurrencies in Belarus spiked last summer, when searches like “what is bitcoin?” and “what is blockchain?” increased substantially, according to the Russian search engine Yandex. By December, cryptocurrency topics climbed up to third place in its Belarusian statistics. Questions like “where can I get bitcoin?” have also contributed to that result. In January, Belarusians were typing “cryptocurrency” into the search bar 45 times more often than a year ago.

Queries regarding opportunities to earn money from crypto-related activities have also increased, Naviny reports. Phrases like “mining farm on credit” and “mining at home” are submitted much more often. Questions about mining hardware have jumped 20-fold since last year. Belarusians are also asking where they can buy “cheap cryptocurrency” and want to know the current rate of bitcoin. ICO-related searches have increased five-fold, with people interested in projects and opportunities.

All questions about crypto earnings have increased significantly in January after the signing of the presidential decree “On the development of the digital economy”. Experts and journalists, however, have been wondering whether Belarussians will be able to “monetize” the hype.

Is There a Catch-22 in Decree №8?

As news.Bitcoin.com reported, the presidential decree entitles companies and individual entrepreneurs to perform operations with tokens and cryptos. To do that, they have to register as residents of the Belarus High Technologies Park (HTP). Private individuals will be allowed to convert cryptos to fiat, using services provided by “crypto-platforms” registered there. However, at this point it seems no one can tell if ordinary Belarusians will be able to spend cryptos in stores or pay for their summer trip in bitcoin. “The issue of regulating cryptocurrency circulation is really relevant. Jurisdictions react differently – some allow it, others ban it, but very few ignore it,” financial analyst Vadim Yosub told Belapan news service, noting that the stance of Belarusian authorities in that respect is not very clear.

More Belarusians Search “Crypto”, Question Legalization

Reading Decree №8, one can find a subparagraph numbered 2.2., which states that “natural persons” (private individuals) have the right to possess tokens and, taking into account the specifics established by the Decree, perform the following operations: mining, storage of tokens in virtual wallets, acquisition and exchange for other tokens, and sale of tokens for Belarusian rubles, foreign currency, electronic money. They can also donate and bequeath tokens. Still unclear: will Belarusians be able to receive their salaries in crypto and pay their bills in bitcoin?

Annex 1 provides definitions for terms used in the presidential decree. Its paragraph 4. defines cryptocurrency as “bitcoin, other digital sign (token), used in international circulation as a universal means of exchange”. Paragraph 6. says that purchases and sales of tokens by residents of the Republic of Belarus are to be conducted in Belarusian rubles. Does that mean cryptos will be accepted as legal tender in Belarus after the legalization?

It is also unclear whether foreign companies can register as residents of the Tech Park directly or whether they should establish a local entity. The latter is more likely true, as paragraph 3. in Annex 3 states that “legal entities and individual entrepreneurs of the Republic of Belarus” may register as residents of the High Technology Park. To do so, they should submit the required documentation and carry out, or plan to carry out, one or more of the listed activities.

Banks Advised to Abstain from Crypto Deals

Decree №8 also states that “cryptocurrency operators” must set up local bank accounts to offer exchange services. According to Belarusian media, authorities have prepared a supplementary document describing the principles of interaction between banks and crypto-platforms. Preliminary reports suggest that the “operators” will be classified as “high risk” clients of the banking system. The National Bank has already said that “cryptocurrencies are not reliable assets” and warned commercial banks against cryptocurrency operations.

“Cryptocurrencies are not based on assets, but on electricity spent for their acquisition. Monetary authorities understand that and treat them with caution,” a source familiar with the position of the central bank told Belapan. He added that all necessary measures will be taken to prevent conversion of cryptocurrency in order to cash out proceeds from illicit activities, as that may lead to international sanctions and blacklisting.

More Belarusians Search “Crypto”, Question LegalizationTaking into account the lukewarm attitude of the National Bank towards cryptocurrencies, commercial banks are not too eager to participate in cryptocurrency exchange operations. “Banks are advised to abstain from deals on the crypto market”, a “top-manager” told Belapan, remaining anonymous. Тhe legalization of cryptocurrencies and their circulation may end up being nominal, local media ponders.

Belarussians are really curious to know whether they will be able to freely buy and sell cryptocurrencies. “Many are interested in the mechanism of conversion – question number 1 we are being asked”, said Vitaly Koleda, IT specialist who took part in a panel discussion at the XIX Assembly of Business Circles of Belarus last week. Lawyers participating in the event also confirmed they were receiving many similar queries after the signing of the “digital economy” decree.

“The decree does not define and does not give legal status to cryptocurrencies,” says Oxana Sachkovskaya, Deputy Head of the Department of Digital Technologies at the Head Office of the Payment System. She points out that it is not clear who will be responsible for regulating their circulation in the country. Opinions have been expressed that the implementation of Decree №8 without additional regulations for the whole crypto sector, may turn Belarus into a “crypto-offshore” zone. “Тhere are concerns that this may lead to sanctions usually imposed on offshore companies,” financial analyst Vadim Yosub said, quoted by Navyni.

With more questions than answers, ordinary Belarusians may soon ask Yandex “What does legalization really mean?”

Do you expect Belarusian authorities to expand the legalization of the crypto sector to allow using cryptocurrencies as means of payment? Tell us in the comments section below.


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New Plant to Assemble Mining Rigs in Belarus

New Plant to Assemble Mining Rigs in Belarus

Plans to build a new manufacturing facility for mining equipment have been announced in Belarus. It will be situated in the Chinese-Belarusian Industrial Park, currently under construction in the “Velikiy Kamen” special economic zone. The plant will be assembling mining rigs with cooling systems utilizing excess heat.

Also read: Two Russian Regions to Develop Large Scale Crypto Mining

Incredible Demand for Everything Crypto

Russian investors are behind the project to build the new plant, which will be producing equipment for cryptocurrency mining farms. The enterprise will be assembling complete mining rigs in the Chinese-Belarusian Industrial Park at “Velikiy Kamen”. The zone has been granted special legal status by authorities in Minsk. Companies operating there will enjoy a preferential tax regime.

New Plant to Assemble Mining Rigs in Belarus

The facility will be offering equipment intended for industrial-scale crypto mining, Belarus Segodnya reported. Russian IT-entrepreneur and owner of Radius Group Dmitriy Marinchev announced the project to Russian media. “This will be a closed cycle production of printed circuit boards and assembly of complete mining devices”, he told Vesti-24 channel.

Marinchev said the mining rigs would be equipped with advanced cooling systems to utilize the heat emitted by the powerful processors. The excess energy could be used for heating homes and greenhouses. His partner Yan Ivanov added that the “demand for everything crypto-related has multiplied” in recent months:

It is incredible. The market potential is around $2 billion, according to Belarusian experts.

Marinchev’s company, a manufacturer of equipment for bitcoin mining, is a co-founding member of the RMC Holding (Russian Mining Center). Another associated firm produces rigs for altcoins. Several mining businesses are also part of RMC.

A Wave of Miners from Russia and the Baltics

Russian miners have been actively registering companies in Belarus. The upcoming legalization of the crypto sector has catalyzed business activity in the whole region, with more and more firms coming to the country. The special presidential decree liberalizing the industry will enter into force on March 28, as news.Bitcoin.com reported.

We register 2-3 new legal entities every day. We haven’t seen such dynamics in many years,

Mikhail Keizerov, head of a small local business incubator, told Belarus Segodnya. “Everyone got so excited. Many mining companies from Russia and the Baltics are coming here. They say we have created all necessary conditions”, Keizerov added. He believes the trend has become a strong impetus for economic growth. Recently the Economy Minister of Belarus Vladimir Zinovskiy said he expected increased employment rates in 2018.

Along with the favorable business climate, Belarus can offer enough affordable energy to power large mining facilities. A representative of Belenergo recently stated he did not expect any shortages due to mining operations in the country, unlike Iceland. The deputy Director General of the state-owned company Sergey Shebeko said:

I cannot see any issues. We are expecting more miners. This will only benefit our country.

Shebeko went on to point out that there was no power generating capacity deficit in Belarus. “We don’t think mining can put the energy system on its knees”, he said, noting the country is ready to satisfy any demand for electric power.

New Plant to Assemble Mining Rigs in BelarusThe mining boom in Belarus started after President Alexander Lukashenko signed the decree “On the Development of the Digital Economy” in December. A close ally of Moscow, the country has been struggling to overcome political and economic isolation in Europe. Authorities in Minsk saw a good opportunity to do that by liberalizing the crypto industry. Cheap energy, produced locally and imported from Russia, can help Belarus provide excellent conditions for mining companies. Soon many Russian miners may be paying Minsk for the cheap energy their own country produces.

Do you think Belarus can successfully overcome isolation by attracting crypto businesses from around Europe? Tell us in the comments section below.


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Another Post-Soviet Jurisdiction Welcomes Crypto Miners

Another Post-Soviet Jurisdiction Welcomes Crypto Miners

Following in the footsteps of counterparts from former Soviet countries, government officials in Transnistria have attempted to create crypto-friendly environment in their disputed republic. Newly adopted legislation legalizes cryptocurrency mining and provides incentives for foreign investors. Entrepreneurs, invited to set up mining facilities, are not even required to register a local company. They can take advantage of tariff-free imports of mining equipment and unrestricted access to cheap energy.

Also read: Cryptocurrency Activities Will Be Legal and Tax Free in Belarus Starting in March

Unrecognized Republic Recognizes Unregulated Mining

Another Post-Soviet Jurisdiction Welcomes Crypto MinersThe parliament of the Pridnestrovian Moldavian Republic has just adopted a new law – “On the development of information blockchain-technologies”. Dedicated free economic zones (FEZ) will be created under its provisions. Foreign nationals and businesses dealing with crypto mining are welcome to reside and operate there without even having to register а local juridical entity.

“We consulted people who understand the technology and came to the conclusion that we need to build the legal and technological basis. So, that’s what we did – we created the regulatory framework”, PMR’s President Vadim Krasnoselsky said, quoted by Kommersant. The head of the unrecognized republic, which borders Moldova and Ukraine, has initiated the adoption of the new legislation.

Investors will enjoy preferential treatment. Residents of the FEZ areas will be able to import mining equipment free of any tariffs. Relocating property out of the zones will also be unimpeded by government restrictions. Pridnestrovian authorities promise “maximum assistance” in regards to providing access to the local electrical grid. Special rates may be offered by “natural monopolies” like the power generating companies.

Another Post-Soviet Jurisdiction Welcomes Crypto Miners

Cryptocurrency mining is energy-intensive but Transnistria has no issues with that. “We are a country that generates electricity”, President Krasnoselsky said, insisting there is plenty of surplus energy to power mining operations. A 48,000 kW hydroelectric station on the Dniester River and a Russian owned Moldavian power plant can electrify mining farms. Three thermal power stations in the capital Tiraspol can also be used. They are running on natural gas supplied by “Gazprom,” and PMR is not paying anything for the “blue fuel”. The $6 billion USD debt is billed to Kishinev because of the ongoing negotiations about the status of Transnistria within Moldova. The republic can produce even more electricity if it burns some of the gas offered by Russia to cover transit fees.

Vadim Krasnoselsky admits that authorities are targeting Russian investors who have demonstrated interest in PMR as a mining destination. One of those potential business “immigrants” is the younger son of Russia’s Prosecutor General Yury Chaika. 30-year-old Igor is a well-known Russian entrepreneur and founder of a company that provides logistical support to Russian firms entering the Chinese market. He told Kommersant that Pridnestrovian authorities had promised to provide the infrastructure for the mining facilities. Projects to invest up to $250,000 USD there have been discussed with several other Russian businessmen. The price of electricity will play a key role when choosing between Transnistria, Moldova and Russia, Igor Chaika said.

Another Post-Soviet Jurisdiction Welcomes Crypto Miners

Cheap Power and Clever Incentives Attract Miners to the Former USSR

By adopting a crypto friendly legal framework, PMR joins a club of several jurisdictions in the post-Soviet space that are trying hard to attract bitcoin related businesses. Much like Transnistria, Belarus is attempting to overcome international isolation, while gravitating around Russia and relying on its cheap energy supplies and other economic aid. A presidential decree legalizing cryptocurrencies, initial coin offerings, and smart contracts in the country will go into effect by the end of March. Entrepreneurs will not be required to declare or pay taxes on activities such as crypto mining.

Intensive debate on regulating bitcoin and other cryptocurrency-related matters has been going on in Ukraine for some time now, with mounting calls to legalize the whole sector. As part of the legislation proposed by Ukrainian deputies, incentives and tax exemptions for crypto incomes and mining profits may be introduced in the country, which is trying to distance itself from Russia, both economically and politically.

According to recent media reports, Uzbekistan is third in a list of top 20 countries offering the lowest expenses for cryptocurrency mining. It costs less than $1,800 on average to mine a single bitcoin there, based on data collected from government sources, utility companies and the International Energy Agency.

The Russian Federation itself, where crypto investments have been growing exponentially, also has what’s needed to welcome miners and host mining facilities. Excess energy production capacity from Soviet times, when heavy industries used huge quantities of electricity, can now power mining farms at very low price. Russia’s Central Bank just announced it wouldn’t mind cryptocurrency mining in the country.

Do you think that cheap energy and smart incentives will attract miners to the former Soviet states? Tell us in the comments section below?


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