Cryptocurrency is the whale in the sea of today’s global finance, and there’s a reason why 300 million people own it. Notably, it has changed how we send and receive payments, providing lower transaction costs, making virtually instant payments, reducing risks, and offering an investment diversification portfolio for many users.

One would be in denial not to believe that the crypto world is growing immensely and that it can only get bigger with time. As such, more and more people are looking to pour their money and time into it. Although not every country in the world is open to cryptocurrency adoption, for now, many have thrown their weight behind it and created fertile grounds for crypto to flourish.

As a passionate crypto investor or trader by luck or chance, you’d want to make strategic choices regarding crypto investment; one way to do that is to know the most crypto-friendly countries suitable for your kind of investment. In fact, that’s why we’ve curated this list to serve as a guide for you. That said, here are the most Bitcoin-friendly countries in the world, their regulations, and projects.

12. Switzerland

Swiss banks were actually the first in the world to offer crypto companies business accounts in 2018. Today, the country classifies cryptocurrencies as assets, and Bitcoin is recognized as legal tender in some locations. 

Regarding regulation, cryptocurrency exchanges are legal in Switzerland as long as they are licensed and therefore regulated by the Federal Financial Market-Supervisory Authority (FINMA). 

Switzerland generally subjects cryptocurrencies to Swiss wealth tax and income tax based on the worldwide income and the worldwide wealth tax values.

Switzerland is famous for the small city, Crypto Valley, which houses many crypto projects. Crypto Valley now has 11 unicorn crypto projects with a valuation of over $1bn, including Ethereum, Cardano, Polkadot, Aave, Cosmos, Solana, Tezos, Dfinity, Near, Nexo, and Diem (formerly Libra).

11. Luxembourg

Luxembourg is a country that has opened its arms to cryptocurrency, having been the first country in Europe to license virtual currency exchange platforms named Bitstamp as payment institutions in 2016.

The country officially recognizes cryptocurrencies as currencies but has no clear cryptocurrency regulations. Regardless, the government’s position on crypto is positive and inclusive. 

Moreover, the country’s CSSF regulates cryptocurrency exchanges in Luxembourg, and they must adhere to the same regulations as other financial organizations. Some popular crypto projects in Luxembourg include Bitcoin, Ethereum, Litecoin, and Zcash.

10. Gibraltar

Gibraltar is a tiny country located south of Spain that draws blockchain-based companies, as it is known to be an attractive spot for doing business.

In 2018, Gibraltar introduced its Digital Ledger Technology (DLT) Regulatory Framework after extensive engagement with the crypto industry. Under the framework, exchanges must register with the Gibraltar Financial Services Commission (GFSC).

Three months ago, the government published guidance clarifying the responsibilities of digital asset service providers seeking regulation.

9. El Salvador 

Literally no one on the internet could have missed El Salvador officially legalizing the use of Bitcoin as a legal tender in 2021,  thereby making it the first in the world to do so.

Crypto regulations fall under the jurisdiction of the government, which has since given Bitcoin its full backing. The BTC Law Regulation provides the regulatory framework for Bitcoin service providers (BSP), including anti-money laundering programmes.

As we know, the major popular crypto project in the country is Bitcoin. The Central American country is hailed as one of the best crypto tax-free jurisdictions in the world.

8. Singapore

In Southeast Asia, Singapore stands among the countries with the most friendly approach to cryptocurrency adoption. The Monetary Authority of Singapore (MAS) fully supports the growth of cryptocurrency in the country.

Specifically, the MAS implemented legislation to regulate the cryptocurrency industry; by introducing and enacting the Payment Services Act (PSA) on January 28, 2020, the MAS has been able to regulate traditional and digital token-based payments.

Additionally, Singaporeans have no capital gains tax on cryptocurrency. Individual and corporate cryptocurrency funds are not subject to taxation. However, if a corporation is based in Singapore and operates as a crypto trading company or accepts crypto payments, it is subject to income tax.

The country is also prominent for being the headquarters for several crypto projects, including the likes of Zilliqa, Qtum, Kyber Network, Bluzelle, and many others.

7. Estonia

Estonia is one of the few countries in the world that was the first to legalize cryptocurrency activity and continues to keep up with the development of technology.

In 2017, a law was introduced in Estonia, enabling entrepreneurs to apply for a license in two directions: exchange of virtual currency to FIAT/virtual currency and the provision of virtual currency wallet services. 

In this part of the world, crypto regulation is largely made by a regulatory body known as the Estonian Financial Intelligence Unit (FIU). It oversees the cryptocurrency license process and anti-laundering related to crypto. 

In Estonia, transactions with Bitcoin and other cryptocurrencies are taxed in the same manner as any other corporate activity. Estonia has crypto projects such as Crypterium, Stex, Ironx, and Coinsbit.io.

6. Germany

Germany is loved by crypto investors when it comes to cryptocurrency taxes. According to German laws, individuals do not have to pay capital gains tax on crypto assets held for more than a year. 

Regulation of crypto in the country is made by the Federal Financial Supervisory Authority (otherwise known as BaFin), which presides over the rule of activities for both traditional fiat banking and virtual assets.

Likewise, the country has since been implementing the EU’s various Anti-Money Laundering directives (i.e., 4, 5 & 6 AMLD) on cryptocurrency, making Germany one of the most compliant in this regard. 

Furthermore, Germany recently developed technology that allows investors to buy and sell securities on the blockchain in return for central bank money. Today, the country has several crypto projects such as Spielworks, LUKSO, and MXC.

5. Portugal

Portugal is surely counted among the most crypto-friendly countries in the world. The Portuguese Tax Authorities (PTA) doesn’t consider capital gains resulting from the sale of cryptocurrencies to be taxable.

Regulation-wise, no specific laws or regulations govern the issuance of cryptocurrencies; hence, cryptocurrencies are not prohibited, and investors are allowed to purchase, hold, and sell these assets.

The Portuguese Anti-Money Laundering Law was expanded in 2020 to include cryptocurrency and is supervised by the Bank of Portugal (“BoP”). AppCoins and KimiaCoin are two of the active crypto projects in Portugal.

4. The Netherlands

The Netherlands has a welcoming attitude towards cryptocurrencies. The country believes that it could potentially help improve the economy of the country. 

Since the Netherlands has no strict regulations against the same, people use cryptocurrencies freely. However, cryptocurrencies are still not accepted as digital money. They follow the standards demanded by the Financial Action Task Force (FATF).

The Dutch National Bank (DNB) supervises crypto service providers’ compliance with the Sanctions Act of 1977. Portugal is considered to be a tax haven since the crypto trade has been tax-free since 2018.

3. Canada

Canada has no legislation that says cryptocurrencies are illegal; hence, many cryptocurrency companies can operate freely in the nation. 

Cryptocurrencies are regulated primarily under securities laws as part of the securities regulator’s mandate to protect the public in Canada. 

Currently, 1,464 ATMs in Canada accept Bitcoin, which is another reason why the nation is considered one of the most crypto-friendly countries. Some crypto projects to have originated from the country include Coinberry, Coinsmart, and Bitbuy.

2. Malta

Malta is seen as being at the forefront of embracing this revolutionary innovation, with many investors keen on diving into crypto in the country. 

On the 4th of July, the Maltese Parliament passed three bills into law, giving any interested investor a clear picture of the legal framework required to set up a legitimate cryptocurrency business in Malta. They include:

i. Malta Digital Innovation Authority Act

ii. Innovative Technological Arrangement and Services Act

iii. Virtual Financial Asset Act

The MFSA is Malta’s leading regulatory authority that is responsible for the ongoing oversight and licensing of companies in the digital space. VAIOT and Xcoins are two of several active crypto projects in Malta.

1. Slovenia

Slovenia ranks at the top as it is very welcoming toward crypto. Individuals who benefit from trading Bitcoin (due to fluctuations in the cryptocurrency market) are not liable for income taxation in Slovenia. Cryptocurrency mining is also not considered a VAT transaction in Slovenia.

In another endeavor, Slovenia amended the Prevention of Money Laundering and Terrorist Financing Law by harmonizing it with EU directives to safeguard investors.

While Slovenia is not entirely crypto tax-free considering some areas of crypto operation in the country are taxed, it’s still one of the most friendly regarding crypto taxes, thanks to its low tax rates and generous policies.

So far, the country has 72 establishments and 33 sports venues that accept digital assets as a payment method.