Understanding cryptocurrency laws and regulations is crucial for crypto enthusiasts worldwide. Staying informed about crypto laws and regulations is not just about compliance but also about protecting investments, fostering market stability, and promoting innovation in the evolving crypto landscape. That’s why, last week, we published a detailed blog titled “Cryptocurrency Laws and Regulations in European Countries (PART 1)”. We promised all readers the second part of this blog would be published soon. So, here we are with PART 2 of Cryptocurrency Laws and Regulations in European Countries.
(If you haven’t read the first part of this blog series, click here
Without further ado, jump straight into this blog post.
11. Iceland
There aren’t any strict crypto laws and regulations in Iceland. Moreover, the Icelandic government doesn’t recognize Bitcoin as a cryptocurrency, but citizens are completely free to own and trade it.
Foreign Exchange Act, no. 70/2021, is one of the prominent Icelandic laws. It came into effect in June 2021 by replacing the Foreign Exchange Act, no. 87/1992. According to this Act, all virtual currencies are electronic currencies, and trading with foreign exchange is prohibited.
12. Ireland
The Central Bank of Ireland is the regulatory authority for regulating cryptocurrency and other financial assets in Ireland. Moreover, the Central Bank of Ireland doesn’t view cryptocurrency as a ‘Legal Tender.’
Compared to other European countries, the Central Bank of Ireland has established strict cryptocurrency laws and regulations. For example, the Central Bank of Ireland considers Bitcoin, Ethereum, and Litecoin’ Unregulated Coins’ as they are ‘Non-Transferable Securities’.
(Non-transferable securities are cryptocurrencies or fungible tokens, which don’t give their holders similar rights or entitlements such as shares, derivatives, and bonds)
Moreover, the Central Bank of Ireland has made its own financial regulations, which decide the classification of each token.
Recently, Ireland passed a new cryptocurrency law, which says,
‘All cryptocurrency companies or VASPs (Virtual Asset Service Providers) must register with ‘The Central Bank of Ireland’ or comply with European Union’s ‘Anti-Money Laundering Guidelines’ to allow its functioning.’
13. Italy
The Italian Government passed legislative Decree No. 135 in 2019. This decree was meant to revolutionize the Italian fintech market. However, it failed to provide any specific guidelines for cryptocurrency. Instead, it provides statutory definitions for smart contracts and cyber currency. The little information on crypto it includes is also defined under the name of DLT (Distributed Ledger Technology).
According to this decree, a DLT is an online ledger facilitating digital transactions.
Jurisdiction of Agencia Per Italia Digitale (AID) is the regulatory body that oversees the use of DLTs in Italy.
14. Luxembourg
Luxembourg recognizes cryptocurrencies as currencies. It was in March 2019 when Luxembourg officially recognized tokenized securities by enforcing a new law. But, still, the nation hasn’t made any significant regulatory law for cryptocurrencies. They still come under the same category, which other financial services providers do, subjecting them to the same AML and CFT (Counter-Terrorist Financing).
Since the EU’s 6th Money Laundering Directive is expected to be enforced soon, some effective legislative steps for crypto can be expected.
15. Liechtenstein
Liechtenstein is the fourth-smallest European country, but its pro-crypto viewpoints are much stronger than many big nations.
‘Liechtenstein’s Blockchain Act’ and ‘Act on Tokens and Entities Providing Services Based on Trusted Technologies’ (TVTG) feature a comprehensive DiFi regulatory framework, which perfectly combats money laundering and facilitates transparency in the crypto industry.
Even the price of Liechtenstein said,
‘Cryptocurrencies are something that can help the country attain a bright economic future.’
16. Malta
Cryptocurrency is legal in Malta. The official regulatory framework for cryptocurrency was introduced in 2018. Initially, it mainly addressed AML and CFT concerns. But this year, Malta is predicted to pass three bills, which may elevate the relevancy of its crypto framework. The three bills include ‘The Virtual Currency Bill,’ ‘The Technology Service Provider Bill,’ and ‘The Malta Digital Innovation Authority Bill or the MDIA Bill. ‘
17. Netherlands
DO YOU KNOW: In January 2018, cryptocurrencies in the Netherlands were too close to getting banned. However, the Dutch Minister of Finance proposed a letter to ‘The Dutch Parliament’ about the undesirability of putting a ban on cryptocurrencies.
Eventually, some measures were taken in 2020 to support cryptocurrency. On May 21, 2020, a Dutch Implementation Act was implemented. According to this law, cryptocurrency exchanges and one-wallet providers must comply with AML and the 5th European Directive for the functioning of their services in the Netherlands.
As of now, ‘The Netherlands’ has very mixed viewpoints about the crypto industry. From time to time, the National Bank of Netherlands also issues consumer warnings regarding the use of cryptocurrencies.
18. Poland
Like ‘The Netherlands, Poland also has diplomatic viewpoints on crypto. Though cryptocurrencies aren’t illegal in Poland, that doesn’t mean they are not legal tender.
Poland’s Ministry of Finance is responsible for regulating the cryptocurrency industry.
19. Portugal
Portugal is, by far, the most obedient EU member state in terms of adopting effective crypto measures. In April 2020, the nation passed the “Digital Transitional Action Plan,” one of Portugal’s top cryptocurrency laws and regulations. According to this act, Portugal aims to establish free and flexible crypto regulatory environments.
The implementation of this act was recommended by the European Union Agreement.
20. Spain
CNMV, or Comisión Nacional del Mercado de Valores, has unofficially stated, ‘Cryptocurrencies are not securities under Spain’s laws. Moreover, Spain itself isn’t very vocal about cryptocurrency except for ICO (Initial Coin Offerings).
The CNMV is an agency that is responsible for the regulations of digital currencies.
Since the enforcement of MiCAR is near, the Spanish government is preparing for the establishment of blockchain-friendly legislation.
21. Sweden
Sweden is another pro-crypto European nation. Though the cryptocurrency laws and regulations are very conflicting and contradictory, but they are well-framed, too.
Finansinspektionen, or FI, is Sweden’s official crypto regulatory body.
Sweden has recently hinted at its plans to create an official national cryptocurrency called e-krona.
22. Switzerland
Switzerland is among the most crypto-friendly nations in Europe. Not only are cryptocurrencies legal in Switzerland, but the nation has also adopted strategic and progressive crypto regulations.
The Swiss Financial Market Supervisory Authority is Switzerland’s official FinTech regulatory body.
Moreover, SFTA (Swiss Federal Tax Administration) has classified cryptocurrency as a property or asset, which means it is subjected to income, wealth, and capital gains.
Let’s tell you an exciting FUN FACT:
Zug, a prominent city in Switzerland, has introduced Bitcoin as one of the primary payment methods.
23. United Kingdom
The United Kingdom is one of the most crypto-friendly nations in the World (forget about Europe). The nation has favorable jurisdictions for effortlessly facilitating a cryptocurrency business.
As per UK crypto laws, cryptocurrency exchanges or wallet providers must register with the FCA (Financial Conduct Authority) to provide their services. Moreover, FCA guidelines also require all cryptocurrency exchanges to comply with the Money Laundering, Terrorist Financing and Other Regulations Act 2017.
In 2024, crypto exchanges are also required to fulfill the conditions of EU’s 5thAMLD for conducting their services in the UK.
If we talk about the UK’s aims in 2024 related to cryptocurrencies, it can be clearly said that the UK’s approach is somewhat gradual, as they are focusing on stablecoins.
The End
Navigating the legal landscape is fundamental for anyone involved in cryptocurrencies. Each European country has its specific regulations, and staying updated on this knowledge ensures that enthusiasts operate within the legal boundaries.
With this, we would like to end our 2-part series blog post, focused on the ‘Cryptocurrency Laws and regulations in all European countries’. If you haven’t read the first part of this blog series, click here:
Stay tuned for more such interesting blog posts.
