Global Crypto Regulatory Landscape: Recent Updates in 10 Countries

Governments all over the globe are considering how to regulate cryptocurrencies in light of their transformation from speculative investments to a new asset class. Governments and regulatory agencies are struggling to develop frameworks to control this quickly expanding business, which is causing the regulatory environment surrounding cryptocurrencies to constantly change. In this post, we examine the most recent developments in 10 nations’ cryptocurrency laws.

Crypto Regulations Around the World

To reduce the losses caused by fraudsters and maintain a reputable business for customers, governments all around the world have taken major action. Some of the crypto regulations around the world are:

1. Thailand: Establishing Risk Tolerance

• After the authorized risk warnings of the Thai SEC (Securities and Exchange Commission) in Sep 2022, a new set of rules for service providers of digital assets has been released which will come to force on Jul 31, 2023.
• The rule is that the authorized platforms will have to establish exposure limits and perform in-depth evaluations of investors’ comprehension of digital assets and risk tolerance. For tokens they supply, they must also establish review and admission panels.
• The limitations are perceived as an effort by Thailand regulators to protect consumers’ assets from possible hazards.

2. USA: Considering NFTs as Property

• Similarly, after the IRS published advice for NFTs outlining conditions in Mar 2023, NFTs are regarded as collectible and subject to the appropriate taxes.
• In accordance with the rules, the IRS views cryptocurrency as “property.” If you purchase, trade, or exchange cryptocurrency, crypto taxes are likely owed.
• To record your cryptocurrency-related activities, you must utilize Form 1040 Schedule D to reconcile any capital gains and losses and Form 8949 if appropriate.

3. Canada: Guidelines for Crypto Trading Platforms

• In August 2022, the Canadian banking and insurance regulator OSFI published the first federal regulations for cryptocurrencies.
• After this, The Canadian Securities Administrators (CSA) published new guidelines on February 2023, that forbid domestic crypto asset trading platforms from allowing users to purchase or deposit Stable coins without the CSA’s prior permission.

4. India: Tax Filing for Crypto Investors

• The Union Budget 2022 has a new tax structure that the government is recommending to the general public.
• Investors in cryptocurrencies will be subject to a 30% tax on their earnings.
• This 30% tax on profits also accounts for the 1% Tax Deducted at Source (TDS) deducted from each cryptocurrency transaction’s consideration by the facilitator, exchanges, or the person who is in charge of paying them.
• People who have made money through virtual digital assets are required to file returns by filling out the appropriate Income Tax Return 1, 2, 3, or 4 forms.
• Businesses must fill out Form Income Tax Return 5 or 6 to submit returns.

5. Brazil: Regulation to Develop National Digital Currencies

• With general usage anticipated by the end of 2024, the central bank of Brazil started a pilot project to produce a digital real.
• Bruno Sousa (Head of U.S. and New Markets at Hashdex) claims that the proposal takes into account crucial elements of the current financial system, including data privacy, security, know-your-customer procedures, and counter-terrorism funding procedures.
• This might be the first of several initiatives to develop national digital currencies.

6. Singapore: Bank partnerships with Crypto firms

• In October 2022, Singapore put out a new law to control cryptocurrencies and stable coins. All crypto assets were treated as “inherently risky” in the law, and measures were taken to reflect this assumption.
• Another decision was made by the Monetary Authority (MAS) in November 2022 to expressly limit banks’ partnerships with cryptocurrency firms.
• The Payment Services Act (PSA) specifies how the Monetary Authority of Singapore (MAS) of the nation licenses and oversees exchanges.

7. Denmark: Regulation for Crypto Assets in European Union

• Leading Danish bank Saxo Bank has received a directive from the Danish Financial Supervisory Authority (FSA) asking it to sell all of its cryptocurrency holdings.
• The FSA made it clear that Saxo Bank’s participation in cryptocurrency trading was done so to reduce risks associated with the bank’s provision of other financial products.
• The FSA added that the markets for crypto assets regulation (MiCA), the regulatory framework for crypto assets in the European Union, is scheduled to go into effect on December 30, 2024, further complicating the issue.

8. China: Regulatory Standards for Trading Platforms

• After the crypto ban in 2017, Hong Kong is now reintroducing trading to ordinary investors in the hopes to establish itself as a significant cryptocurrency center in the area.
• The regulatory standards for trading platforms for virtual assets will cover things like “suitable” disclosures and onboarding procedures.
• Tokens that are going to be exchanged on these platforms must meet a “minimum criteria” that will make sure that “retail investors should be less prone to market manipulation.”
• Only two crypto businesses have received licenses from the Securities and Futures Commission (SFC) as of yet, and these regulations took effect on June 1, 2023.

9. Switzerland: Regulated Environment for Crypto Businesses

• In 2016, Zug, a city in Switzerland began accepting bitcoin as a payment for city dues.
• Considering that, recently on November 2022, Switzerland updated the FINMA Anti-Money Laundering (AML) law, reiterating the need that big payments cannot be divided into smaller ones in order to circumvent identification checks mandated by the AML regulations.
• This implies that for a period of 30 days, connected transactions cannot surpass a barrier of CHF 1000 (about $1,070).
• The new regulation only applies to exchanges between virtual currencies and cash or other anonymous payment methods, such as ATMs. This underlines once further Switzerland’s willingness to offer a regulated environment for businesses using cryptocurrency.

10. Australia: Developing Framework for Crypto Licensing

• In 2019, ASIC (Australian Securities and Investments Commission) prohibited exchanges from selling privacy coins, which are digital currencies that protect user anonymity by concealing the movement of money across their networks, and imposed regulatory regulations for initial coin offerings (ICOs).
• After that, Australia had plans to develop a framework for licensing cryptocurrencies in 2021 and possibly introduce a central bank digital currency (CBDC).
• Exchanges are permitted to operate in the nation without restriction, providing they register with AUSTRAC and adhere to certain AML/CTF requirements.