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

Click a broker for details
  1. 1
    eToro USA
    Invest $100 and get $10
    https://www.daytrading.com/ is not an affiliate and may be compensated if you access certain products or services offered by the MSB and/or the BD.

    Ratings
    4.3 / 5
    3 / 5
    3.9 / 5
    3.4 / 5
    4 / 5
    3 / 5
    4.3 / 5
    4.5 / 5
    4.3 / 5
    4 / 5

    $10
    $10
    SEC, FINRA
    Stocks, Options, ETFs, Crypto
    eToro Trading Platform & CopyTrader
    ACH Transfer, Debit Card, PayPal, Wire Transfer
    USD
  2. 2
    NinjaTrader

    Ratings
    4.3 / 5
    2.8 / 5
    2.9 / 5
    4.3 / 5
    4.5 / 5
    4 / 5
    4 / 5
    3.5 / 5
    3 / 5
    3.2 / 5

    $0
    0.01 Lots
    1:50
    NFA, CFTC
    Forex, Stocks, Options, Commodities, Futures, Crypto
    NinjaTrader Desktop, Web & Mobile, eSignal
    ACH Transfer, Debit Card, Wire Transfer
    USD
  3. 3
    OANDA US
    CFDs are not available to residents in the United States.

    Ratings
    4.5 / 5
    3.5 / 5
    2.8 / 5
    4 / 5
    4.5 / 5
    3.5 / 5
    4.3 / 5
    3.8 / 5
    4.7 / 5
    3.7 / 5

    $0
    0.01 Lots
    1:50
    NFA, CFTC
    Forex, Crypto with Paxos (Cryptocurrencies are offered through Paxos. Paxos is a separate legal entity from OANDA)
    OANDA Trade, MT4, TradingView, AutoChartist
    Wire Transfer, Visa, Mastercard, Debit Card, ACH Transfer
    USD, EUR, GBP, CAD, AUD, JPY, CHF, HKD, SGD
  4. 4
    Uphold
    Terms Apply. Cryptoassets are highly volatile. Your capital is at risk.

    Ratings
    3 / 5
    0 / 5
    4.3 / 5
    3.8 / 5
    4.5 / 5
    2.3 / 5
    0 / 5
    0 / 5
    4.6 / 5
    4.4 / 5

    $0
    $1
    Cryptos
    Desktop Platform, Mobile App
    Wire Transfer, ACH Transfer, Bitcoin Payments, Debit Card, Credit Card, Mastercard, Visa, Ethereum Payments
    USD, EUR, GBP
  5. 5
    IG
    Forex trading involves risk. Losses can exceed deposits.

    Ratings
    4.9 / 5
    4 / 5
    4.5 / 5
    3.5 / 5
    4.8 / 5
    4.5 / 5
    4.9 / 5
    5 / 5
    4.6 / 5
    4 / 5

    $0
    0.01 Lots
    1:30 (Retail), 1:250 (Pro)
    FCA, ASIC, NFA, CFTC, DFSA, BaFin, MAS, FSCA, FINMA
    CFDs, Forex, Stocks, Indices, Commodities, ETFs, Futures, Options, Crypto, Spread Betting
    Web, ProRealTime, L2 Dealer, MT4, AutoChartist, TradingCentral
    PayPal, Wire Transfer, Mastercard, Credit Card, Visa, Debit Card
    USD, EUR, GBP, CAD, AUD, JPY, ZAR, SEK, DKK, CHF, HKD, SGD
  6. 6
    IQCent
    20% to 200% Deposit Bonus

    Ratings
    2.5 / 5
    3.3 / 5
    2.4 / 5
    4.3 / 5
    3.8 / 5
    2.5 / 5
    3 / 5
    2 / 5
    4.3 / 5
    4.1 / 5

    $250
    $0.01
    1:500
    IFMRRC
    Binary Options, CFDs, Forex, Indices, Commodities, Crypto
    Online Platform, TradingView
    Credit Card, Debit Card, Wire Transfer, Bitcoin Payments, Ethereum Payments, Visa, Mastercard
    USD, EUR
  7. 7
    Binarium

    $5
    $1
    Forex, Stocks, Cryptos
    Own
    QIWI, Yandex Money, Bitcoin Payments, Neteller, WebMoney, Wire Transfer, Visa, Mastercard, Credit Card, Debit Card
    USD, EUR, AUD, RUB
  8. 8
    Videforex
    20% to 200% Deposit Bonus

    $250
    $0.01
    1:500
    Binary Options, CFDs, Forex, Indices, Commodities, Crypto
    TradingView
    Skrill, Perfect Money, Bitcoin Payments, Neteller, Credit Card, Visa, Mastercard, Ethereum Payments
    USD, EUR, GBP, AUD, RUB
  9. 9
    Pocket Option
    50% Deposit Bonus

    Ratings
    2 / 5
    3.5 / 5
    2.5 / 5
    3.5 / 5
    3.3 / 5
    3.3 / 5
    3 / 5
    3.5 / 5
    4 / 5
    4.2 / 5

    $50
    $1
    MISA
    Binary Options, Currencies, Commodities, Stocks, Indices, Cryptos
    Web, MT4, MT5
    Wire Transfer, Credit Card, Bitcoin Payments, Volet, Perfect Money, Visa, Mastercard, Debit Card, WebMoney, FasaPay, Ethereum Payments, Maestro, JetonCash
    USD
  10. 10
    Nexo
    Loyalty scheme with various bonuses, plus referral program and bonus paid to lenders on credit line

    Ratings
    2.5 / 5
    3 / 5
    3 / 5
    2.5 / 5
    3.5 / 5
    4 / 5
    2.5 / 5
    1 / 5
    3.8 / 5
    4 / 5

    $10
    $30
    Cryptos
    Nexo Pro
    Bitcoin Payments, Credit Card, Debit Card, Apple Pay, Google Wallet, Wire Transfer
    USD, EUR, GBP

Here is a short overview of each broker's pros and cons

  1. eToro USA - eToro US offers 24 tradeable cryptoassets, with just a 1% buying/selling fee added to the spread. Additionally, there are 80 different coins available through the broker’s proprietary wallet service. You can also practice your crypto strategies easily by switching between live and demo mode. Crypto asset investing is highly volatile and unregulated. No consumer protection. Tax on profits may apply.
  2. NinjaTrader - You can get exposure to micro Bitcoin futures through the CME Group’s centralized exchange, which is highly regulated by the US CFTC. Micro contracts allow you to trade a fractional size of one Bitcoin, giving you more risk control and order flexibility.
  3. OANDA US - Cryptocurrency trading is offered via Paxos, a separate entity from Oanda. You can speculate on the world’s biggest cryptos by market cap. Commissions are lower than many peers starting at 0.25%. Through the broker’s partnership with Paxos, clients can spot trade cryptocurrencies on the itBit exchange through the OANDA native platform.
  4. Uphold - You can buy and sell 250+ crypto assets with fiat currencies or in crypto pairs using the straightforward mobile app or through Uphold's browser-based account homepage. This is significantly more than many rivals. You can also earn up to 16% APY by staking one or more out of 32 valid tokens, or send tokens to an external wallet.
  5. IG - IG's modest selection of 11 crypto CFDs trails top crypto brokers like Vantage which offers 40+ tokens. That said, it stands out with its crypto index, which tracks the value of the top 10 digital currencies by market cap and provides a holistic way to speculate on the value of the crypto market.
  6. IQCent - IQCent offers 17 crypto pairs through its proprietary terminal, including Bitcoin, Ethereum and Litecoin. Leverage on crypto CFDs is capped at 1:10, whilst binary options payouts vary by token but remain competitive. OTC assets, for example, pay out up to 95%.
  7. Binarium - Trade binary options on three Bitcoin pairs – BTC/USD, BTC/GBP and BTC/EUR – with flexible contract lengths. Simply bet whether the price of the asset will rise or fall.
  8. Videforex - Traders can speculate on crypto prices in pairs with USD and CNY through binary options and CFDs. The range of digital currencies is fairly narrow vs alternatives but major tokens like Bitcoin are available.
  9. Pocket Option - Pocket Option offers a modest crypto offering with 10+ digital currencies including Bitcoin and 65+ tokens if you deposit $1000. The integrated analytics feature in the platform is helpful for finding opportunities, while the daily signals service makes it straightforward to act on short-term crypto opportunities.
  10. Nexo - Nexo offers trading on an impressive suite of around 70 tokens, including Bitcoin. Digital assets can be bought, sold and swapped directly on the exchange or traded in over 500 pairs. Digital assets can also be used as collateral for fiat loans or used to generate passive income with the ‘smart staking’ tool or from interest earned via peer-to-peer loans.

eToro USA

"eToro remains a top pick for traders looking for leading social investing and copy trading services. With a low deposit, zero commissions and an intuitive platform, the broker will meet the needs of newer day traders."

Rebecca Holden, Reviewer

eToro USA Quick Facts

Bonus OfferInvest $100 and get $10
CoinsBTC, ETH, BCH, DASH, LTC, ETC, MIOTA, XLM, EOS, NEO, ZEC, XTZ, MKR, COMP, LINK, UNI, YFI, DOGE, AAVE, ALGO, MANA, ENJ, BAT, MATIC, FLR, SHIBxM
Crypto MiningNo
Auto Market MakerNo
Crypto SpreadBTC 0.75%
Crypto LendingNo
Crypto StakingNo
PlatformseToro Trading Platform & CopyTrader
Minimum Deposit$10
RegulatorSEC, FINRA
Account CurrenciesUSD

Pros

  • The broker's Academy offers comprehensive learning materials for beginners to advanced-level investors
  • The online broker offers an intuitive social investment network with straightforward copy trading on cryptos
  • Investors can access Smart Portfolios for a more hands-off approach, covering a range of sectors and markets such as renewable energy and artificial intelligence

Cons

  • Average fees may cut into the profit margins of day traders
  • There's a narrower range of day trading instruments available compared to competitors, with only stocks, ETFs and cryptos
  • The proprietary terminal doesn't support trading bots and there are no additional stock market analysis tools

NinjaTrader

"NinjaTrader continues to meet the demands of active futures traders looking for low fees and premium analysis tools. The platform hosts top-rate charting features including hundreds of indicators and 10+ chart types."

Tobias Robinson, Reviewer

NinjaTrader Quick Facts

CoinsBTC
Crypto MiningNo
Auto Market MakerNo
Crypto SpreadFloating
Crypto LendingNo
Crypto StakingNo
PlatformsNinjaTrader Desktop, Web & Mobile, eSignal
Minimum Deposit$0
RegulatorNFA, CFTC
Account CurrenciesUSD

Pros

  • NinjaTrader is a widely respected and award-winning futures broker and is heavily authorized by the NFA and CFTC
  • NinjaTrader continues to deliver comprehensive charting software for active day traders with bespoke technical indicators and widgets
  • Low fees are offered, with $50 day trading margins & commissions from $.09 per micro contract

Cons

  • The premium platform tools come with an extra charge
  • Non forex and futures trading requires signing up with partner brokers
  • There is a withdrawal fee on some funding methods

OANDA US

"OANDA remains an excellent broker for US day traders seeking a user-friendly platform with premium analysis tools and a straightforward joining process. OANDA is also heavily regulated with a very high trust score."

Rebecca Holden, Reviewer

OANDA US Quick Facts

CoinsBTC, ETH, LTC, BCH, PAXG, LINK, UNI, AAVE
Crypto MiningNo
Auto Market MakerNo
Crypto Spread$100
Crypto LendingNo
Crypto StakingNo
PlatformsOANDA Trade, MT4, TradingView, AutoChartist
Minimum Deposit$0
RegulatorNFA, CFTC
Account CurrenciesUSD, EUR, GBP, CAD, AUD, JPY, CHF, HKD, SGD

Pros

  • Day traders can enjoy fast and reliable order execution
  • OANDA is a reliable, trustworthy and secure brand with authorization from tier-one regulators including the CFTC
  • Beginners can get started easily with $0 minimum initial deposit

Cons

  • It's a shame that customer support is not available on weekends
  • There's only a small range of payment methods available, with no e-wallets supported
  • The range of day trading markets is limited to forex and cryptos only

Uphold

"Uphold remains a top choice for crypto investors looking for a one-stop-shop solution to accessing the markets. There are over 250 tokens to buy, sell and trade through flexible platform options."

Rebecca Holden, Reviewer

Uphold Quick Facts

CoinsBTC, BTCO, AAVE, ALCX, DYDX, INH, XYO, API3, GHST, LSK, AUDIO, GLMR, NMR, CAKE, GODS, REQ, CHR, TRB, DAO, ROOK, XRP, ETH, BAT, ADA, ALGO, ATOM, AVAX, AXS, BCH, BAL, BTG, CSPR, COMP, CRV, DASH, DCR, DGB, DOGE, DOT, EGLD and many more
Crypto MiningNo
Auto Market MakerNo
Crypto SpreadUp to 1.5%
Crypto LendingNo
Crypto StakingYes
PlatformsDesktop Platform, Mobile App
Minimum Deposit$0
Account CurrenciesUSD, EUR, GBP

Pros

  • UK users can get the Uphold card with up to 2% cashback in XRP
  • Over 250 cryptos are available including major tokens like Bitcoin and Ethereum
  • Fees are competitive based on tests, with 26 underlying platforms helping to source the best prices

Cons

  • The charting analysis features on the platform trail specialist exchanges
  • Uphold operates with limited regulatory oversight
  • Customer service is slow based on tests, with limited contact options

IG

"IG continues to provide a comprehensive package with an intuitive web platform and best-in-class education for beginners, plus advanced charting tools, real-time data, and fast execution speeds for experienced day traders."

Christian Harris, Reviewer

IG Quick Facts

CoinsBTC, BCH, LTC, ETH, ADA, DOT, DOGE, LINK, UNI, XLM
Crypto MiningNo
Auto Market MakerNo
Crypto SpreadVariable
Crypto LendingNo
Crypto StakingNo
PlatformsWeb, ProRealTime, L2 Dealer, MT4, AutoChartist, TradingCentral
Minimum Deposit$0
RegulatorFCA, ASIC, NFA, CFTC, DFSA, BaFin, MAS, FSCA, FINMA
Account CurrenciesUSD, EUR, GBP, CAD, AUD, JPY, ZAR, SEK, DKK, CHF, HKD, SGD

Pros

  • IG is amongst the best in terms of its range of instruments, which includes stocks, forex, indices, commodities, and cryptocurrencies, providing ample diversification opportunities
  • As a well-established broker, IG operates under strict regulatory guidelines in multiple jurisdictions, maintaining a high level of trust
  • The IG app offers a superb mobile trading experience with a clean design that helped it secure Runner Up at our Best Trading App award

Cons

  • Stock and CFD spreads still trail the cheapest brokers like CMC Markets based on tests
  • Beginners might find IG’s fee structure complex, with various fees for different types of trades or services, potentially leading to confusion or unexpected charges
  • IG applies an inactivity fee of $12 per month after 2 years, deterring casual investors

IQCent

"IQCent will appeal to day traders looking for a straightforward binary options and CFD trading platform with low fees, a range of accounts, and copy trading. Getting started takes less than 1 minute and a $250 deposit. "

Rebecca Holden, Reviewer

IQCent Quick Facts

Bonus Offer20% to 200% Deposit Bonus
CoinsBTC, ETH, LTC, ETC, DOGE, MATIC, QNT, SOL, XRP, USDT, XMR, BNB
Crypto MiningNo
Auto Market MakerNo
Crypto SpreadVariable
Crypto LendingNo
Crypto StakingNo
PlatformsOnline Platform, TradingView
Minimum Deposit$250
RegulatorIFMRRC
Account CurrenciesUSD, EUR

Pros

  • The broker's 24/7 customer support is fast and reliable, responding within 1 minute during tests
  • The broker offers up to 98% payouts on binary options, which is more than alternatives like Pocket Option, only offering up to 92%
  • There's an accessible $0.01 minimum stake for new day traders with a small budget

Cons

  • IQCent trails binary brokers like Quotex with its narrow investment offering of around 100 assets with no stocks
  • IQCent charges a punitive $10 monthly inactivity fee if you fail to place at least 1 trade per month
  • The broker is not overseen by a respected regulator, though this is common among binary options firms

Binarium

"Binarium is a good binary options broker for traders looking for an experienced brand with low deposit requirements and a welcome bonus."

William Berg, Reviewer

Binarium Quick Facts

CoinsBTC
Crypto MiningNo
Auto Market MakerNo
Crypto SpreadN/A
Crypto LendingNo
Crypto StakingNo
PlatformsOwn
Minimum Deposit$5
Account CurrenciesUSD, EUR, AUD, RUB

Pros

  • Community forum platform
  • Demo account with virtual funds
  • Segregated client funds

Cons

  • Limited trading instruments
  • No industry established trading terminals
  • Specific bonus terms and conditions to meet before being able to withdraw funds

Videforex

"Newer traders will find a lot to enjoy about trading binary options on Videforex's easy-to-use proprietary platform, as well as the broker's copy trading solution. Payouts also remain higher than most alternatives climbing to 98%."

William Berg, Reviewer

Videforex Quick Facts

Bonus Offer20% to 200% Deposit Bonus
CoinsBTC, ETH, QUANT, UNI, SOL, BNB, DOGE, XRP, XMR, MATIC, USDT
Crypto MiningNo
Auto Market MakerNo
Crypto SpreadFloating
Crypto LendingNo
Crypto StakingNo
PlatformsTradingView
Minimum Deposit$250
Account CurrenciesUSD, EUR, GBP, AUD, RUB

Pros

  • Global clients can make free and fast transfers via a wide range of payment types, from credit cards to cryptocurrencies
  • You can easily mirror the trades of experienced investors with low fees
  • The firm facilitates both day trading and binary options which is great for those looking to diversify their portfolios

Cons

  • No MetaTrader 4 integration
  • The broker isn’t overseen by a trusted regulatory agency
  • US clients aren’t accepted due to legal restrictions

Pocket Option

"Pocket Option excels for its easy-to-use web platform which provides a best-in-class user experience for short-term binary traders. The $50 minimum deposit is also accessible for beginners while opening an account is really easy. Looking at the negatives, Pocket Option still trails alternatives in its market offering and regulatory credentials."

Rebecca Holden, Reviewer

Pocket Option Quick Facts

Bonus Offer50% Deposit Bonus
CoinsBTC, ETH, BCH, LINK, AAVE, ALGO, TLM, ALPP, ANT, AVAX, AXS, BNB, ADA, CHZ, COMP, ATOM, DASH, MANA, DGB, DOGE, ENJ, EOS, FIL, GLMR, ILV, ICP, KAVA, LTC, MKR, MASK, MIOTA, XMR, ALICE, NEAR, NEO, NULS, OMG, DOT, MATIC, QTUM and many more
Crypto MiningNo
Auto Market MakerNo
Crypto SpreadN/A
Crypto LendingNo
Crypto StakingNo
PlatformsWeb, MT4, MT5
Minimum Deposit$50
RegulatorMISA
Account CurrenciesUSD

Pros

  • The web platform shines for its straightforward design and usability that will appeal to beginners looking to speculate on popular financial markets in a few clicks
  • Well-funded traders who deposit $1000+ can qualify for a 2%+ payout boost, more tradable assets and exclusive perks
  • The range of payment methods beats the majority of rivals, providing fast, secure and convenient deposits for traders in most countries

Cons

  • Despite offering competitive payouts up to 92%, binary brokers like IQCent offer higher returns up to 98% based on tests
  • Pocket Option offers a slimmed down iteration of the MT4 and MT5 that doesn't provide the full charting package for advanced traders
  • The MISA is a weak regulator with limited investor protection for retail traders

Nexo

"Nexo gives crypto traders the capability to trade, invest, lend and borrow digital assets in one place, and it’s especially good for its credit functions that pay out very high yields to lenders. However, its fees are relatively high and many day traders will prefer a more tightly regulated crypto broker."

Michael MacKenzie, Reviewer

Nexo Quick Facts

Bonus OfferLoyalty scheme with various bonuses, plus referral program and bonus paid to lenders on credit line
CoinsBTC, ETH, NEXO, USDT, USDC, AXS, RUNE, MATIC, DOT, APE, AVAX, KSM, ATOM, FTM, NEAR, BNB, ADA, SOL, XRP, LTC, LINK, BCH, TRX, XLM, EOS, PAXG, UNI, DOGE, MANA, SAND, GALA, SUSHI, AAVE, CRV, MKR, 1INCH, DAI, USDP, TUSD
Crypto MiningNo
Auto Market MakerNo
Crypto SpreadN/A
Crypto LendingYes
Crypto StakingYes
PlatformsNexo Pro
Minimum Deposit$10
Account CurrenciesUSD, EUR, GBP

Pros

  • Nexo’s crypto staking and credit features support crypto lending and borrowing, and the yields lenders receive are among the best going
  • Value-add tools integrated into the trading platform including social media analysis and newsfeeds by asset
  • Traders benefit from bonuses and incentives including free trading funds paid to lenders and cashback in the form of the exchange’s native Nexo token

Cons

  • The range of tokens is extensive compared to most crypto brokers but still much smaller than similar crypto exchanges like Kraken
  • High maker/taker fees mean day traders will pay more to trade derivatives than they would at rival exchanges like Binance
  • Very few educational resources are available, reducing its appeal to beginners who can find more helpful resources at category leaders like eToro

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.