Bitcoin is one of the several forms of cryptocurrency that is created and handled electronically. It is a form of digital payment invented by Satoshi Nakamoto, an unknown programmer or group of programmers. It was first released in 2009 as open-source software. The peer-to-peer digital currency has garnered a new era of payment.
The legality of cryptocurrency like Bitcoin has been quite a controversial journey since most countries do not accept it as a legal tender. This is because Bitcoin is a decentralized cryptocurrency and does not have a governing body to regulate it; this leads to extreme volatility which is not good for the economic system.
However, in spite of this, there are a few countries that have welcomed the use of cryptocurrencies with open arms while others have already put a ban on it, like:
Legal in countries
- USA
The country has taken a positive approach towards Bitcoin and has set up many government agencies that work on preventing and reducing illegal use of cryptocurrency. There are several businesses like Overtock.com and Dish Network that welcome Bitcoin payments.
- Canada
Canada is a Bitcoin-friendly nation as well. Bitcoin transactions are seen as barter transactions and the income generated is considered as business income. Bitcoin exchanges in Canada are considered more like money a service business, which requires the cryptocurrency to be registered with FINTRAC (Financial Transactions and Reports Analysis Centre) to curb illegal practices.
- Australia
Australia allows buying, mining and trading of Bitcoins. The Australian Taxation Office considers Bitcoin, or any other cryptocurrency, transactions barter arrangements that are subjected to appropriate taxes that depend upon the parties involved.
- European Union
Although Bitcoin is being used across the European Union, there is no official declaration on its regulation, acceptance or legality. In the absence of a central regulation system, some European countries have developed their own rules and regulations like Finland, UK, Belgium, Germany, etc.
Illegal in countries
- Iceland
The island nation has banned foreign exchange trading with Bitcoin to protect the outflow of Icelandic currency from the country after the global economic crisis in 2008 and not compactable with its Foreign Exchange Act.
- Vietnam
Vietnam has maintained that Bitcoin or any other cryptocurrency is not a legitimate payment method from the beginning itself. After a few rounds of public response against the use of Bitcoin, the country made it illegal for citizens and financial institutions to accept or deal with Bitcoin.
- China
Although banks and financial institutions cannot transact or deal with Bitcoins, individuals are free to deal between themselves. Thanks to this move, Bitcoin is thriving in China. But you will not be able to process the payment via any recognized financial body.
Bottom Line
There are some countries where hostility against cryptocurrencies is slowly changing for the better (China, South Korea), while some have welcomed it with open arms (Canada). There are even a few countries that are planning to start their own cryptocurrency like Venezuela. With more time, there is a high chance that cryptocurrencies will finally be declared legal all over the world and will have a regulatory body.