By Natalie Lord
Cryptocurrencies have been embraced or disregarded to varying degrees by different countries around the world. Some maintain caution and apply bans or restrictions on investment in or use of cryptocurrencies. Others don’t consider it a threat and welcome the opportunities offered by digital currencies. We take a look at differing attitudes to the space, and find out how this game of chess is being played across the globe.
An initial key difference is terminology. Although there is a broad understanding of what cryptocurrencies are around the world, the terms used to reference cryptocurrencies vary from one country to the next. For example, in Australia, Argentina and Thailand instead of “cryptocurrencies”, the term used is “digital currencies”. Canada, Taiwan and China prefer to call cryptocurrencies “virtual commodities.” In Italy and Lebanon, cryptocurrencies are known as “cyber currencies,” whilst in Switzerland they are “payment tokens” and in Germany they’re “crypto tokens.” Colombia calls cryptos “electronic currency,” and in Honduras and Mexico they are called “virtual assets.” Same product, different vocabulary.
That’s just the beginning. The attitudes adopted by countries varies immensely. Many countries issue warnings around the potential for cryptocurrencies to be used in illegal activities like money laundering or terrorism. However, some countries go further than this and have extended legislation on money laundering, counter terrorism and organised crime to incorporate cryptocurrency markets. Laws have been enacted in the Isle of Man, Canada and Australia to bring institutions that facilitate cryptocurrency transactions and the transactions themselves under the ambit of money laundering and counter-terrorist financing laws.
Other countries have restricted investments in cryptocurrencies to different degrees. In Algeria, Bolivia, Egypt, Iran, Iraq, Macedonia, Morocco, Nepal, Pakistan and Vietnam, any and all activities involving cryptocurrencies are banned. Bahrain and Qatar ban citizens from engaging in cryptocurrencies investments or activity within their countries, but allow citizens to engage in the space outside of their borders if they might wish to. In Bangladesh, China, Colombia, Lesotho, Lithuania and Thailand citizens aren’t banned from being involved in the cryptocurrency sphere, but financial institutions within their countries are not allowed to facilitate transactions involving cryptocurrencies which obviously makes participation in the space difficult.
However, not all countries see cryptocurrencies and its counterpart, blockchain technology, as a threat. Countries like Belarus, the Cayman Islands, Luxembourg and Spain see potential in the technology and are developing a cryptocurrency-friendly regime with a view to attracting investment in technology companies that excel in this arena. They haven’t gone as far as recognising cryptocurrencies as legal tender yet though.
There are countries that do recognise cryptocurrencies and accept it as a means of payment. We’ve seen increasing adoption of digital currencies in the United States with Bitcoin ATMs springing up around the country. Mexico accepts cryptocurrencies as a means of payment alongside its national currency. Cryptocurrencies are also accepted as a means of payment and even by government agencies in the Swiss cantons of Zug and in a municipality within Ticino. Meanwhile, in Antigua and Barbuda, cryptocurrencies are accepted for the funding of projects and charities through government-supported ICOs.
Elsewhere, countries including Lithuania, Venezuela and the Marshall Islands are looking to develop their own cryptocurrency systems; whilst Belgium, the United Kingdom and South Africa say the cryptocurrency market is too small to warrant a ban or regulation at this point.
The future of cryptocurrencies is clearly perceived in vastly different ways by countries around the world, with their attitudes towards it coloured accordingly. It’ll be interesting to witness the inevitable changes that lie ahead one way or the other as the crypto environment develops. Only time will tell who the victor in this game of chess will be, or whether it will end in stalemate.