Crypto Regulations

Cryptocurrencies, also known as altcoins, provide digital means of exchange without any physical coins or bills. The crypto market has grown rapidly in popularity since Bitcoin’s inception in 2008. However, the more ubiquitous it becomes, the need for crypto regulations increases. We discuss the history of government action, the future of crypto regulations and more.

Crypto Brokers

  1. Trade the major cryptos against USD, EUR, GBP and AUD. All traded with tight spreads. No virtual wallet required, just a trading account. Note, cryptos are not available in the US or Canada.

    Forex.com Crypto Trading

    Forex.com offers trading on 5 crypto coins: BCH, BTC, ETH, LTC, XRP

    Crypto Spread
    BTC 1.4%, ETH 2%
    Crypto Lending
    No
    Platforms
    MT4
    Crypto Staking
    No
    Minimum Deposit
    $100
    Regulator
    CySEC, IIROC, NFA, CFTC, FCA, CIMA
  2. Trade micro Bitcoin with low fees

    NinjaTrader Crypto Trading

    NinjaTrader offers trading on 1 crypto coin: BTC

    Crypto Spread
    Floating
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    No
    Minimum Deposit
    $50
    Regulator
    NFA, CFTC
  3. Uphold offers trading on more than 100 crypto assets including via crypto-only pairs and crypto-fiat cross pairs.

    Uphold Crypto Trading

    Uphold offers trading on at least 96 crypto coins, for example: AAVE, ADA, ALCX, ALGO, API3, ATOM, AUDIO, AVAX, AXS, BAL, BAT, BCH, BTC, BTCO, CAKE, CHR, DAO, DYDX, ETH, GHST, GLMR, GODS, INH, LSK, NMR, REQ, ROOK, TRB, XRP, XYO

    Crypto Spread
    0.5% to 1% average
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    Yes
    Minimum Deposit
    $0
    Regulator
    FCA, FinCEN
  4. Trade four major cryptocurrencies paired with USD

    IG Group Crypto Trading

    IG Group offers trading on 4 crypto coins: BCH, BTC, ETH, LTC

    Forex trading involves risk. Losses can exceed deposits

    Crypto Spread
    Variable
    Crypto Lending
    No
    Platforms
    MT4
    Crypto Staking
    No
    Minimum Deposit
    £250
    Regulator
    FCA, ASIC, MAS, FSCA, JFSA, FMA, CFTC, NFA, BMA, DFSA, FINMA, BaFin
  5. Coinmama aim to make entering the crypto market as easy as possible, offering big tokens like Bitcoin and Ethereum

    Coinmama Crypto Trading

    Coinmama offers trading on 9 crypto coins: BCH, BTC, DOGE, ETH, LINK, LTC, UNI, XRP, XTZ

    Crypto Spread
    From 2.93% to 3.90%. Express fees of 0-5.00% also apply.
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    No
    Minimum Deposit
    $30
    Regulator
    FinCEN, FINTRAC
  6. Pionex is an automated crypto trading platform with built-in bots and a wide range of tokens.

    Pionex Crypto Trading

    Pionex offers trading on at least 229 crypto coins, for example: AAVE, ADA, ALICE, AXS, BAKE, BCH, BTC, BTT, BUSD, CAKE, DOGE, DOT, EOS, ETC, ETH, FIL, HT, ICP, JST, LINK, LTC, NFT, PUNDIX, SNX, SUN, TFUEL, TRX, UNI, WIN, XRP

    Crypto Spread
    Market
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    No
    Minimum Deposit
    $0
    Regulator
    FinCEN
  7. Build custom crypto portfolios and select from the broker's expert pies.

    M1 Finance Crypto Trading

    M1 Finance offers trading on 8 crypto coins: ADA, ALDO, ATOM, AVE, BAT, BTC, ETH, LINK

    Crypto Spread
    Variable
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    No
    Minimum Deposit
    $100 ($500 for IRA)
    Regulator
    FINRA, SEC
  8. Paxful offers buying and selling of the world's leading cryptocurrencies.

    Paxful Crypto Trading

    Paxful offers trading on 3 crypto coins: BTC, ETH, USDT

    Crypto Spread
    Rates set by vendors
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    No
    Minimum Deposit
    From 0.005 BTC
    Regulator
    -
  9. Invest in cryptocurrency via OTC Trusts, ETFs, mutual funds and Bitcoin futures

    TD Ameritrade Crypto Trading

    TD Ameritrade offers trading on 4 crypto coins: BTC, ETH, MBT, MET

    Crypto Spread
    Commission fees apply
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    No
    Minimum Deposit
    $0
    Regulator
    SEC, FINRA, CFTC
  10. IB Boast a huge market share of global trading. With a minimum deposit of $10,000 however, they remain an option for larger traders only.

    Interactive Brokers Crypto Trading

    Interactive Brokers offers trading on 4 crypto coins: BTC, ETH, LTC, XRP

    Crypto Spread
    -
    Crypto Lending
    No
    Platforms
    AlgoTrader, OmniTrader
    Crypto Staking
    No
    Minimum Deposit
    $10000
    Regulator
    SEC, FCA, IIROC, SFC
  11. Trade popular cryptocurrency coins with low fees.

    Crypto Spread
    0.18% fee per trade
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    No
    Minimum Deposit
    $2500
    Regulator
    FINRA
  12. Trade cryptocurrencies against the US Dollar

    AAAFx Crypto Trading

    AAAFx offers trading on 6 crypto coins: BCH, BTC, ETH, LTC, USDT, XRP

    Crypto Spread
    From 1.3 pips
    Crypto Lending
    No
    Platforms
    MT4, MT5
    Crypto Staking
    No
    Minimum Deposit
    $10
    Regulator
    HCMC (Greece), FSCA (South Africa)
  13. Trade over 65 cryptocurrencies including Bitcoin

    Kraken Crypto Trading

    Kraken offers trading on at least 57 crypto coins, for example: AAVE, ADA, ALGO, ANT, ATOM, BAL, BAT, BCH, COMP, CRV, DAI, DASH, EOS, ETC, ETH, EWT, FIL, FLOW, GNO, ICX, KAVA, KEEP, KNC, KSM, LINK, MANA, REP, REPV2, XBT, XDG

    Crypto Spread
    0-0.26% average
    Crypto Lending
    No
    Platforms
    AlgoTrader
    Crypto Staking
    Yes
    Minimum Deposit
    $10
    Regulator
    FCA, FinCEN, FINTRAC, AUSTRAC, FSA
  14. Trade a handful of the top cryptos at Quotex.

    Quotex Crypto Trading

    Quotex offers trading on 4 crypto coins: BTC, ETH, LTC, XRP

    Crypto Spread
    N/A
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    No
    Minimum Deposit
    $10
    Regulator
    -
  15. Webull offers trading on popular cryptos such as Bitcoin against the US Dollar.

    Webull Crypto Trading

    Webull offers trading on at least 43 crypto coins, for example: ADA DASH, ALGO, ATOM, AVAX, BAT, BCH, BTC, CRV, DOGE, EOS, ETC, ETH, FTM, GRT, LINK, LRC, LTC, LUNA, MANA, MATIC, REM, SHIB, SISHI, SOL, TRX, UNI, XLM, XMR, XTZ, ZEC

    Crypto Spread
    Floating
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    No
    Minimum Deposit
    $0
    Regulator
    SEC, FINRA
  16. Trade over 100 crypto pairs on an extensive list of popular and emerging digital currencies.

    Gemini Crypto Trading

    Gemini offers trading on at least 56 crypto coins, for example: AAV, ADA, ATOM, BAT, BCH, BTC, COMP, DAI, DOGE, DOT, ENJ, EOS, ETH, FIL, GRT, LINK, LTC, MANA, MKR, SNX, SOL, UMA, UNI, WBTC, XLM, XRP, XTZ, YFI, ZEC, ZRX

    Crypto Spread
    Transaction fee from $0.99
    Crypto Lending
    Yes
    Platforms
    AlgoTrader
    Crypto Staking
    Yes
    Minimum Deposit
    $0
    Regulator
    NYDFS, MAS, FCA
  17. Nexo supports cryptocurrency trading through its exchange platform on 35+ in-demand tokens.

    Nexo Crypto Trading

    Nexo offers trading on at least 39 crypto coins, for example: ADA, APE, ATOM, AVAX, AXS, BCH, BNB, BTC, DOGE, DOT, EOS, ETH, FTM, KSM, LINK, LTC, MANA, MATIC, NEAR, NEXO, PAXG, RUNE, SAND, SOL, TRX, UNI, USDC, USDT, XLM, XRP

    Crypto Spread
    N/A
    Crypto Lending
    Yes
    Platforms
    Own
    Crypto Staking
    Yes
    Minimum Deposit
    $10
    Regulator
    ASIC, FCEN
  18. Make crypto trades against fiat currencies with a single tap from $1.

    Revolut Crypto Trading

    Revolut offers trading on at least 53 crypto coins, for example: 1INCH, AAVE, ADA, ALGO, AMP, ANKR, ATOM, BAND, BAT, BCH, BNT, BTC, CELO, CHL, COMP, CRV, CTSI, DOGE, ENJ, EOS, ETH, FIL, ICP, KEEP, KNC, LINK, LTC, MANA, RLC, ZRX

    Crypto Spread
    2.5% commission for standard profiles
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    No
    Minimum Deposit
    $0
    Regulator
    FINRA, SEC
  19. Trade on 10 cryptos paired with the USD and EUR. Crypto only pairs are also available.

    World Forex Crypto Trading

    World Forex offers trading on 10 crypto coins: BCH, BTC, DSH, EOS, ETH, LTC, NEO, XMR, XRP, ZEC

    Crypto Spread
    -
    Crypto Lending
    No
    Platforms
    MT4, MT5
    Crypto Staking
    No
    Minimum Deposit
    $1
    Regulator
    SVGFSA
  20. Pocket Option supports five cryptocurrency options assets spanning major tokens and cross pairs.

    Pocket Option Crypto Trading

    Pocket Option offers trading on 4 crypto coins: BTC, EOS, ETH, LTC

    Crypto Spread
    N/A
    Crypto Lending
    No
    Platforms
    MT5
    Crypto Staking
    No
    Minimum Deposit
    $50
    Regulator
    IFMRRC
  21. Buy and sell an extensive list of leading and emerging crypto coins at Binance.

    Binance Crypto Trading

    Binance offers trading on at least 56 crypto coins, for example: ADA, ALGO, BCH, BNB, BTC, BUSD, DAI, DOGE, EGLD, ENJ, EOS, ETH, HBAR, HNT, IOTA, LINK, LTC, MANA, MATIC, NANO, NEO, ONE, QTUM, RVN, SOL, USDT, VET, VTHO, XLM, ZIL

    Crypto Spread
    Variable fees with account tiers
    Crypto Lending
    Yes
    Platforms
    AlgoTrader
    Crypto Staking
    Yes
    Minimum Deposit
    $0
    Regulator
    FCA
  22. eToro leads the way in cryptocurrency trading. The lowest spreads (from 0.75% for BTC), their own wallet service and the largest number of cryptos to trade in the market. Cryptoasset investing is highly volatile and unregulated in the UK and some EU countries. No consumer protection. Tax on profits may apply..

    eToro Crypto Trading

    eToro offers trading on 15 crypto coins: ADA, BCH, BNB, BTC, DASH, EOS, ETC, ETH, LTC, MIOTA, NEO, VET, XLM, XRP, ZEC

    79% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

    Crypto Spread
    BTC <1%, ETH 2%
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    Yes
    Minimum Deposit
    $10
    Regulator
    FCA, CySEC, ASIC, FSA
  23. InstaForex offer crypto CFD trading on leading tokens with very low fees.

    InstaForex Crypto Trading

    InstaForex offers trading on 6 crypto coins: BCH, BTC, ETH, LTC, XRP, and 14 more

    Crypto Spread
    From 0%
    Crypto Lending
    No
    Platforms
    MT4, MT5
    Crypto Staking
    No
    Minimum Deposit
    $/€1
    Regulator
    BVI FSC

History Of Cryptos

The technical foundations of cryptocurrency were pioneered by an American cryptographer named David Chaum in 1983. He invented a cryptographic system that has a blinding algorithm, which is still used in modern web-based encryption. This algorithm provided secure exchanges and confidential transactions amongst parties, which was known as ‘blinded money’.

However, the term ‘cryptocurrency’ was first coined by Wei Dai in 1998 who published a white paper on b-money. In that year, the software engineer formulated a payment method based on a cryptographic system that had characteristics of decentralisation, but it was never fully developed.

What is crypto trading

In 2008, Satoshi Nakamoto, a pseudonymous person or secret identity, published a paper called ‘Bitcoin – A Peer to Peer Electronic Cash System’. Nakamoto’s motive to create Bitcoin was in response to the financial crisis of 2008. In 2009, Nakamoto made the Bitcoin software public and a group of enthusiasts began exchanging and mining Bitcoin.

In 2010, Bitcoin was valued for the first time when someone decided to sell theirs by swapping 10,000 Bitcoin for two pizzas. Around the same time, dozens of similar cryptocurrencies began to appear with Litecoin and Ethereum gaining popularity by 2016.  The number of establishments where Bitcoin could be used started to gradually increase in 2017, with the likes of Tesla now indicating that they will accept Bitcoin payments for its cars.

Blockchain technology continues to disrupt the fintech industry, bringing with it both trading opportunities while also capturing the attention of regulators.

Crypto Regulations

Government policies and crypto regulations vary by country as authorities aren’t globally coordinated on the matter. In the US, for example, cryptocurrencies are not insured by the government like bank deposits are. Cryptocurrencies stored online won’t have the same legal protections as the money in your bank account. If a digital wallet company goes out of business, the government is unlikely to step in.

Crypto trading rules

New crypto regulations are continuously being updated so it’s important to stay abreast of trading exchange requirements, along with rules around crypto mining, lending, custody and taxes. And while there aren’t many blanket prohibitions or bans on crypto trading, governments always issue caution when investing due to market volatility.

Crypto Regulations In the UK

The UK’s cryptocurrency regulations allow users to buy and sell altcoins though they are not considered legal tender. However, as of January 6th 2021, the Financial Conduct Authority (FCA) banned the sale of retail crypto derivatives and ETNs. The motive behind the ban comes from the risky nature of the industry, which puts consumers in danger from scams and market instability.

Note, UK residents can still participate in cryptocurrency exchanges as the ban is focused on retail trading products. The direct purchase of established cryptocurrencies is still permitted.

Crypto Regulations In the US

US crypto regulations are more complicated due to the inconsistent approaches taken across the country. This is because laws vary by state, while others still have pending legislation.

Cryptocurrencies are not considered legal tender and are not backed by the US government or the central bank. Crypto exchange regulations in the US are in uncertain legal territory. With that said, one of the United States’ major regulatory bodies, the Securities and Exchange Commission (SEC), stated that it considers cryptocurrencies to be securities, with the intention to apply securities laws for digital wallets and exchanges.

On the other hand, the Commodities Futures Trading Commission (CFTC), describes Bitcoin as a commodity and allows for cryptocurrency derivatives to be traded publicly. The Financial Crimes Enforcement Network (FinCEN) has proposed a series of new regulations for financial institutions that deal with digital currencies. However, these have been delayed.

It’s worth checking the rules in your own state before you open an account and start trading. Also, more new USA crypto regulations are coming, so make sure to keep up with the news.

Crypto Regulations In Europe

The European Commission recognised the need for legal certainty on blockchain-based applications. In February 2021, The European Central Bank (ECB) issued an opinion on the MiCA proposal published by the EU Commission in September of the previous year.

The proposed MiCA regulation aims to set out a comprehensive regulatory and supervisory regime for crypto-assets in the EU while supporting innovation. The proposed regulation also covers both firms that issue crypto-assets and those that provide services such as digital wallets and cryptocurrency exchanges i.e. Crypto.com.

The ECB has generally supported the proposal’s objectives with some concerns on e-money and stablecoins. The concern stems from stablecoins presenting a potential threat to the conduct of monetary policies and smooth operation of payment systems, which fall under the competence of the ECB. For now, it is hard to know when MiCA regulations will be enforced. However, based on estimations from EU regulators and previous EU regulations, this might be enforced over the next two to four years.

On a national level, Germany is preparing a comprehensive national blockchain strategy, which will support the development of European and international regulations for cryptocurrencies. But currently, retail crypto trading is allowed at most EU-regulated brokers.

Cryptocurrency exchange rules

Crypto Regulations In The Netherlands, Switzerland & Estonia

In the Netherlands, cryptocurrencies aren’t accepted as digital money but are regarded as property. However, the country is striving to regulate them. In contrast, Switzerland accepts crypto exchanges and is regulated by SFTA and FINMA, with the need to obtain a license. Cryptocurrencies as payment are also legal in Swiss stores in certain contexts while retail trading is allowed.

Estonia also holds a similarly progressive stance, where crypto exchanges are legal with approved registration but are not yet considered legal tender. Estonia has planned future regulatory changes i.e. customer identification obligations, payments services and record keeping.

Crypto Regulations In Asia

Asia is the financial hub where most of the world’s crypto trading takes place. Japan has the most progressive regulation, recognising Bitcoin and other digital currencies as legal property. Crypto exchange regulations are also legal with the requirement to register with the FSA.

Singapore’s tax authorities treat Bitcoin as goods, thus, Goods and Services Tax is applied. The surge of Bitcoin in 2017 prompted Malaysia’s Securities Commission to regulate the market by enforcing the Capital Markets and Services Order in 2019.

Crypto is not considered legal tender in India, while exchanges are effectively legal due to the lack of robust regulatory frameworks. Hong Kong considers crypto as virtual commodities, which fall under ‘securities’ that are subject to the SFC’s regulation.

Other Global Views

Other countries take a more conservative view of crypto regulations. In Russia, the law prohibits crypto exchanges, with the Ruble remaining the only legal form of tender. In China, crypto exchanges are illegal and cryptocurrencies are not considered legal tender. In recent years, the Chinese government drafted a law that bestowed legal status on the People’s Bank of China’s digital Yuan.

When it comes to cryptocurrencies in Dubai, the UAE does not recognise Bitcoin as a legal form of tender. However, exchanging digital currencies is allowed, with many UAE-based brokers offering crypto trading. Interestingly, Abu Dhabi’s ADGM was the first to introduce a regulatory framework for virtual assets.

In Canada, digital currencies are not considered legal tender but can be used as payment to buy goods online or in stores that accept them. Canada’s central bank characterises it as securities and Canadian laws have applied tax to crypto transactions since 2013. Exchanges in Canada are regulated as well.

Australia treats cryptocurrencies as legal, classed as property in 2017. Crypto exchanges are also legal, with the requirement to register with AUSTRAC. Retail crypto trading is permitted.

The Future of Crypto Regulations

Cryptocurrency regulations are constantly changing as their popularity grows. While some governments like Japan and Australia have taken a progressive stance on cryptocurrencies, some countries are still concerned with the characteristics of blockchain technology and restrict retail trading, such as in the UK.

The main concerns come from a security perspective, with data protection, money laundering, tax evasion and other financial crimes flagged as issues. Also a perceived problem is their volatile nature, with crypto regulations often attempting to shield individuals from the dangers.

Nonetheless, it looks like cryptocurrencies are here to stay with global regulations likely to try and bring order to a mostly unregulated market. How crypto regulations grapple with the decentralised foundation of blockchain technology will be interesting to follow.

Final Word On Crypto Regulations

Cryptocurrency regulations around the world vary, with retail traders facing different restrictions depending on their location. Many crypto regulations and policies are still a work in progress due to the myriad of considerations. As a result, it’s key that traders keep up to date with the latest rules and requirements in their country.