In this piece, we will take a look at five countries where bitcoin is legal and illegal. For more countries, head on over to 15 Countries Where Bitcoin is Legal and Illegal.
5. French Republic
Bitcoin Legal or Illegal: Legal
The French Republic is a European country that is a global power in international politics. France permits Bitcoin mining and it has different kinds of capital gains taxes for individuals that trade Bitcoin. For those individuals that sell Bitcoins privately and don’t do it too much or as part of an income generating activity, France levies a capital gain. For others, who buy and sell regularly, France levies an income tax on them. For corporations, only realized gains are taxed at the end of the year.
4. Canada
Bitcoin Legal or Illegal: Legal
Canada is a North American developed country. For those looking to set up a Bitcoin business in the country, Canada requires registration with the government. Additionally, while Canada does not outright prohibit Bitcoin mining, miners must comply with local regulations on energy usage. Bitcoin is treated as a commodity than a currency in the country, and for capital gains tax purposes, Canada requires that half of any gains made during the year are imputed for calculation. Personal mining is not taxed, and any salary paid in Bitcoin must be converted into Canadian dollars – following the rules of general transactions that consider payments in Bitcoin as a barter transaction.
3. United States of America
Bitcoin Legal or Illegal: Legal
The United States of America is the world’s largest economy and the only superpower in today’s world. The U.S. taxes Bitcoin as property, and taxes are levied on profit from goods sold through Bitcoin and also on the fair market value. Gains on Bitcoin held for more than a year are treated as capital gains, while those on Bitcoin held for less than a year are treated under income tax. Additionally, while mining is not outright banned, some states have energy usage regulations and others encourage the liquidation of mining equipment.
2. Central African Republic
Bitcoin Legal or Illegal: Legal
The Central African Republic is a landlocked country in Central Africa. It is the latest country that has adopted Bitcoin as a legal tender – which means that instead of an asset, the currency is now allowed to be used to make purchases. However, the decision itself is controversial, as few people in one of the least developed countries in Africa have access to the Internet – which is a must for using Bitcoin. Additionally, the country also encourages Bitcoin mining, as it promises no income or corporation tax on mining activities.
1. Republic of El Salvador
Bitcoin Legal or Illegal: Legal
The Republic of El Salvador is the world’s first country that recognized Bitcoin as a legal tender. Bitcoin was seen as a method for El Salvador to pay off its massive debts, and its president had announced in January that it would issue Bitcoin denominated bonds to pay off $688 million dollar of Eurobond debt. The country also has Bitcoin ATMs, but overall adoption of the currency remains low particularly due to low Internet adoption.
Disclosure: None. You can also take a peek at 10 Cheap Solar Stocks to Buy and Jim Cramer’s 10 Comeback Stocks.
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