In the fourth part of our series, we will go to Asia to check how well life is thereBitcoin brotherhood and how many more hours to waitX.When will the full adoption of cryptocurrency technologies finally occur, and what will the law say - when the Bitcoin price crosses the $100,000 mark or more? Next up are high-tech Japan, conservative China (and isolated Hong Kong), friendly Singapore, as well as relatively young, but extremely promising Kazakhstan and Uzbekistan. So, Asia.

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Previous parts of the series:

On the issue of national characteristics of thermorectal cryptanalysis or "Where cryptans live well" - part 1

On the issue of national characteristics of thermorectal cryptanalysis or "Where cryptans live well" - part 2

On the issue of national characteristics of thermorectal cryptanalysis or "Where cryptans live well" - part 3

Japan

Despite a fairly loyal attitude tocryptocurrencies from the very beginning, until March 2014, the Bank of Japan did not have any special plans regarding the regulation of their turnover. However, after the loud and impressive crash of the Tokyo-based Mt.Gox cryptocurrency exchange, the Japanese authorities became noticeably nervous. As a result, Japan became one of the first countries to establish a full-fledged regulatory framework for dealing with cryptocurrency assets, including licensing exchanges and implementing anti-money laundering measures.

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Legislative status

There is a legal framework. Free traffic is allowed. Government attitude is moderate

Basic documents and definition of cryptocurrencies

April 1, 2017Japanese authorities have passed new legislation on cryptocurrency transactions. Thus, such key cryptocurrencies as Bitcoin and Ethereum were finally legalized in the country. At the same time, as in other countries, cryptocurrencies were not recognized as legal tender. The official and only legitimate currency is the yen, and the legal circulation of cryptocurrencies is limited by the framework of intermediary systems.

Major industry associations associated withcryptoassets are: the virtual currency exchange association established under the PSA and the securities dealers association that oversees financial operators under the FIEA.

Additional amendments to the current lawwere adopted by the Japanese parliament on May 31, 2019 and entered into force a year later. The Japanese House of Representatives almost unanimously approved the new bill, which was prepared by the Japanese Financial Services Agency (FSA). Amendments were made to the "Law on Financial Settlements" and "Law on Financial Instruments and Exchanges". The changes are aimed at stricter control over derivative products, as well as preventing the risks of exchange hacking.

In relation to Bitcoin itself, nothing has changed, except that now it is called "cryptoasset", and not "virtual currency". Although, there is definitely a difference.

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Restrictions and taxes on the use of cryptocurrencies

The legislation does not provide for a general ban on the issuance, mining, ownership or trading of cryptocurrencies.

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In Japan, it is possible to legally own, use and exchange cryptocurrency for local fiat currency, not forgetting the requirements of PSA, FIEA and other, undoubtedly, important rules.

As already indicated, in Japan, cryptocurrencies did not becomelegal tender, which means that companies and individuals cannot use them directly to pay for goods and services (officially). By law, they are required to use the services of registered exchange offices.

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Administrative and criminal prosecutions for cryptocurrency ownership

There are no specific penalties for owning cryptocurrency.

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Limits and taxes on cryptocurrency trading

Today, Japan Financial Services Agency(FSA), first of all, seeks to limit the maximum leverage (leverage) available to users of cryptocurrency exchanges (no more than two times).

Additionally, in April 2018The Japan Virtual Currency Exchange Association (JVCEA) has mandated local trading platforms to keep their funds separate from clients' assets, have a minimum collateral of $ 1.8 million, and regularly publish financial statements and conduct scheduled audits.

Also, the association is actively fighting againstinsider trading (with tougher punishment of those responsible) and takes measures to combat money laundering. Therefore, according to the new rules, trading platforms are highly recommended to refuse to work with such anonymous coins as Monero and Zcash.

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According to Japanese tax law -income from stocks and sales of foreign currencies are taxed at a rate of 20%, and tax rates on profits from cryptocurrencies can be as high as 55%. This is especially true for investors whose annual income exceeds 40 million yen.

Perhaps that is why, over the years, about 30Japanese companies and 50 individuals associated with cryptocurrency have been convicted of trying to conceal income, the total value of which has exceeded more than 10 billion yen (~ $ 92.4 million). The Japan New Economy Association has already asked the Japan Financial Services Agency (FSA) to reduce the tax on electronic money from 55% to 20%. The finance minister is against.

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Administrative and Criminal Prosecutions for Cryptocurrency Trading

Trading is not a prohibited activity

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Restrictions and taxes on businesses related to cryptocurrencies

Any cryptocurrency exchanger in Japan is required toregister with the Japan Financial Services Agency (FSA). And, according to the new law, for this it is necessary to have a registered capital of at least 10 million yen (~ $ 88,200) and a secure computer system for conducting financial transactions. Additionally, such an organization is required to undergo an audit every year.

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Despite the restrictions, Japanese companies cannotit is forbidden to use Bitcoin and Ethereum for mutual settlements with each other. In addition, companies and individuals can buy these cryptoassets as a commodity that is not subject to the mandatory 8% consumption tax (analogous to value added tax).

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Administrative and Criminal Prosecutions for Cryptocurrency Business

The most epic business in the cryptocurrency industry -the case of the MtGox exchange, which was based in Tokyo, and at the time of closing was the largest cryptocurrency platform in terms of trading volume. However, in February 2014, she went bankrupt loudly and generated a huge number of conspiracy theories around her. This is a kind of cornerstone in the history of the formation of cryptocurrencies. He is also a stumbling block to which a huge number of people and companies are tied. I don't think anyone will ever admit what actually happened there. All the official stories are trivial lies in order to hide - where did billions of dollars in bitcoins go? According to a rough estimate, from 750 to 850 thousand bitcoins of the exchange users and 100 thousand of its own were lost. Later they managed to return 200 thousand bitcoins (not without the participation of the community), but the rest of the amount was never found. Apparently, they were looking badly.

Later, in 2015, the Japanese police arrestedMark Karpeles, the [alleged] founder of the MtGox exchange, was accused of manipulating the company's computer systems to improve balance. The smallest thing that could be presented then. Later, Ross Ulbricht announced Karpeles' involvement in the Silk Road case. But who was interested in this ...

Later, on suspicion of involvement inTheft of funds from MtGox in Greece was arrested by the Russian Alexander Vinnik, to whom such countries as the USA, France and New Zealand had additional claims. Alexander's true role in the MtGox case never became known to the general public. But, everything seems more than artificial.

China

Despite the rather skeptical attitudethe government of China to everything that does not fit into the framework of the party and a number of prohibitive measures regarding cryptocurrency arbitrariness - the country still remains the leader and main player in the multi-haired cryptocurrency market. In general, the Chinese authorities adhere to an innovative course, but no arbitrariness and financial power of the people. Communism in Chinese, led by the father of the people, period. All in all, “creating a unified and open digital marketplace to meet the new needs of people's lives” is undoubtedly a top priority. How else?

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Legislative status

There is a legal framework. Free traffic is limited. The attitude of the government is "positive-negative".

Basic documents and definition of cryptocurrencies

Incidentally, China is the first country to have passed a full-fledged cryptography law to effectively address regulatory and legal issues in this area.

“In general, this is the first law that hasdirectly related to cryptography and private / public key management. The development of new cryptography, hashing algorithm and even the use of technology will be in the official legal field. This means that you will have to comply with the established standards in all "encrypted" behaviors, which can be interpreted very broadly: from mining to transferring blocks "

True, the "law on cryptography" is not the same as the "law on cryptocurrencies." Right?

Strange, but with enough serious attentionthe Chinese government to cryptocurrencies - they really have not found a legislative definition. There is no specific concept for virtual assets in the General Principles of Civil Law. In general, there are no separate laws for Bitcoin in China. True, there are outright bans.

At the same time, the Beijing International Arbitration Centerclearly expressed the position of the authorities: the Chinese leadership does not oppose cryptocurrencies, but is ready to welcome this wonderful phenomenon if it is able to strengthen the yuan. Apparently, it means mining income.

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Be that as it may, in July 2019, the Hangzhou City Court recognized bitcoins as "virtual property." But from the official point of view of regulators - BTC is a virtual commodity. Not the point.

Another important fact: in 2020, a court in Shenzhen ruled that Ethereum is legally protected property,and citizens of the countryit is not forbidden to ownand operate with cryptocurrency.But, in fact, everything has been done so that the citizens of the country still do not own or operate any cryptocurrency.

After all, decisions of local courts are not yet a law at the level of an entire country. Right?

As of today, Chinese regulators do not consider cryptocurrency as an alternative to fiat money.

But, apparently, in the future, the governmentChina is preparing for the full implementation of cryptocurrency at the level of the state economy. The People's Bank of China has already drafted a law on the legalization of the digital yuan (CBDC) and is about to impose a complete ban on competing cryptocurrencies, whoever issued them. After November 23, 2020, the new rules were going to be submitted to legislators for approval. Thus, China plans to create a transparent financial market in which there will be no other digital currencies [and other dissent] in order to avoid confusion in the management of the [human] money supply.

Restrictions and taxes on the use of cryptocurrencies

The Beijing Arbitration Commission held thatthe exchange of bitcoins for fiat through cryptocurrency exchanges, as well as the sale of cryptocurrency for the national currency is prohibited. At the same time, if the cryptocurrency, in a separate case, acts as a "digital product", then the prohibition is not applicable. It is likely that here, first of all, the interests of miners are taken into account, and those who take taxes from them.

In general, while bitcoins do not act asmeans of payment - everything is within the law. Therefore, the Central Bank of China indicated that "no legal entity or individual can produce or sell tokens, coupons and digital tokens to replace the yuan in circulation in the market." Sober and cruel. The only legitimate currency, along with a physical banknote, can only be the digital yuan. This is the kind of digital communism.

It is worth recalling that there are four giant mining pools based in the PRC, which account for more than 60% of the computing power of the Bitcoin network.

Additionally, China is the largest in the world [almostmonopoly] manufacturer of specialized computer equipment (ASIC) for Bitcoin mining and other alternatives. It is natural that China sells equipment at an order of magnitude cheaper than mini-competitors, and the cost of electricity pleasantly pleases local miners. In general, all the conditions for stable leadership and prosperity of the industry. The Chinese dragon will not bite off its leg.

And yet, the largest "Chinese" manufacturer of mining equipment Bitmain, on the eve of its own IPO on the American stock exchanges, decided not to risk it and opened an office in Silicon Valley.

Whatever it was, but China's fight against cryptocurrencies is frankly reminiscent of the US CIA's fight against drug trafficking.

It is not for nothing that the analytical company Chainalysis notes that over the past year, more than $ 50 billion has flowed from China abroad through the stablecoin Tether. China is an empire. Cryptocurrency empire.

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Current situation: China has banned eating dogs and trading cryptocurrency... We willingly believe.

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Administrative and criminal prosecutions for cryptocurrency ownership

There are no specific penalties for owning cryptocurrency.

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Limits and taxes on cryptocurrency trading

It is important that the activities of cryptocurrency exchanges inChina has also been declared illegal. Cryptocurrency trading for Chinese citizens was not formally prohibited, but there are practically no legal ways to buy and sell. It was just that the local regulator "verbally asked" companies focused on cryptocurrency trading to stop their activities.

Banning cryptocurrency exchanges? No, you haven't. Previously banned exchanges have worked as they are. They just changed their jurisdiction or continued to exist in the gray and black zone.

Chinese cryptocurrency exchanges are quite fastrefocused on other growing markets: Japan, Korea and the USA. Chinese companies continued to make high-profile ICOs, but the target audience was already formally outside the country’s borders.In other words, the wise Chinese government did not want to litigate the claims of disappointed investors in local courts.

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Administrative and Criminal Prosecutions for Cryptocurrency Trading

In 2019, the Chinese authorities closed 173 cryptocurrency exchanges. The People's Bank of China notes that the closure took place "without complications."

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Restrictions and taxes on businesses related to cryptocurrencies

In December 2013, China's central bank banned financial institutions from transacting cryptocurrencies.

At the end of March 2014, the People's Bank of Chinaordered by April 15, 2014, all Chinese banks and payment systems to close the accounts of a number of Chinese sites that sell bitcoins. For disobedience, punishment was promised, however, the People's Bank of China did not specify which one. Although, there is no doubt that the Chinese are all right with their fantasy, regarding punishments.

September 4, 2017 People's Bank of Chinatogether with other government authorities of the People's Republic of China issued a notice “on preventing risks associated with the offering of tokens and financing” (“ICO Risk Notice”). The main goal was to ban any “Initial Coin Offerings” in China. Additionally, all organizations and individuals who have already conducted an ICO in China were ordered to return the funds raised to investors.

Separately, the ICO Risk Notice included:so-called “trading platforms for token financing” are mentioned. To put it simply, a ban was introduced on the purchase and sale of tokens and virtual currencies. ________________________________________

The owners of most of the closed exchanges are notless, and did not intend to completely leave the Chinese cryptocurrency market (moved away from draconian laws), and their mining pools and cloud mining services continued to work legally.

Although, until November 2019, mining was also inout of favor with local authorities. Subsequently, the attitude changed and relief was given. At the same time, no one canceled the organized inspections [quietly].

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Aggression by the authorities is aimed not only atdecentralized cryptocurrencies, but also for such failed stablecoins as Facebook's Libra. But, no comment here. China's war with major tech giants has long been at the forefront of the "newspapers". It's time to re-commission the Great Wall of China from the entire non-communist world. Anyway, the pernicious influence of the West is on the face. Although, what is the Great Chinese Firewall not an analogue?

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Regarding gambling in China, everything is also strict -no virtual money to transfer funds to other countries. The government openly forces such gaming services to cooperate with law enforcement agencies.

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Administrative and Criminal Prosecutions for Cryptocurrency Business

Mass detention of illegal bookmakers duringthe time of the last World Cup was also associated with the seizure of large volumes of cryptocurrency, which is actively used to withdraw assets from China in order to acquire expensive foreign real estate.

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The Chinese authorities did not ignore andthe organizers of the PlusToken fraudulent scheme, through which more than 2 million gullible citizens were deceived for a year in the amount of $ 7.6 billion. In this case, 15 people were arrested and convicted, who received prison sentences from 2 to 11 years. In addition, the Chinese police seized $ 4.2 billion worth of cryptocurrency in bitcoins. Not so weak.

Hong Kong

But digital Hong Kong is already somewhat different.attitude to the regulation of the turnover of cryptocurrency assets, since this is no longer exactly China. Commercial transactions with cryptocurrencies are not prohibited here and even approved. Hong Kong is a special administrative region of China, and despite its small territory, it has a population of 7 million. The economy is mainly aimed at the development of finance and trade. In general, a kind of entrepreneurial oasis that lives by separate rules.

Hong Kong has not only isolated morefriendly rules of doing business than in greater China, but also its own currency - the Hong Kong dollar (HKD), which has a significant trading volume. For this reason, a very decent number of companies have settled here: exchanges, OTC platforms, brokers, etc.

Thus, Hong Kong's economy is ranked 44th in the world, and possibly the freest in the world. So it will be, if it does not change the tough politics of the older brother.

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Legislative status

There is a legal framework. Free traffic is allowed. Government attitude is positive

Basic documents and definition of cryptocurrencies

Currently for cryptocurrencyactivities are supervised by the local currency board and the Securities and Futures Commission of Hong Kong (SFC). Although, due to the fact that cryptocurrencies are recognized as “virtual goods”, the powers of the SFC have minimal force. A special case is an ICO. Additionally, “virtual goods” must meet certain Customs and Excise Department (C&amp;ED) requirements.

By and large, in the jurisdiction of Hong Kongonly a couple of documents are in force that (from January 2014) directly regulate operations with cryptocurrencies. At the same time, the essence of the documents comes down, basically, to the fact that companies working with cryptocurrencies are required to identify their customers and merge at the first request of the appropriate authorities. Although, to all appearances, the "proper bodies" do not abuse their powers.

But, this is not yet the laws came from the "mainland",after all, the ubiquitous eye of the Chinese brother does not sleep. Today, the new law "On Improving the Legal System and Law Enforcement Mechanism of Hong Kong" has already provided the Chinese authorities with ample opportunities to restrict civil liberties in Hong Kong. For example, crimes that "threaten national security" now face life imprisonment.

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Restrictions and taxes on the use of cryptocurrencies

The legislation does not provide for a general ban on the issuance, mining, ownership or trading of cryptocurrencies.

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Administrative and criminal prosecutions for cryptocurrency ownership

There are no specific penalties for owning cryptocurrency.

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Limits and taxes on cryptocurrency trading

Large exchange participants must obtain a license to conduct transactions using cryptocurrencies.

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Administrative and Criminal Prosecutions for Cryptocurrency Trading

Trading is not a prohibited activity

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Restrictions and taxes on businesses related to cryptocurrencies

As for the Hong Kong cryptocurrency exchanges,they are required to obtain a Money Service Operator MSO license. First of all, the license obliges them to implement measures to combat money laundering (AML) and terrorist financing (CTF). And although this requirement is not so important for Hong Kong regulators - in practice, the management of trading platforms, like most ICO token issuers, readily carry out all the proper procedures. Moreover, in the future, according to the recommendations of the FATF, the rules are planned to be toughened.

For legal entities that simplywant to use cryptocurrencies, for example, for mutual settlements - Hong Kong requires a license only from large companies. The rest can perform operations with cryptocurrency assets on a general basis.

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Capital gains tax in respect ofcryptocurrency investments in Hong Kong do not operate, which only stimulates the industry. However, income tax applies to a company, no matter what currency it operates with.

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Administrative and Criminal Prosecutions for Cryptocurrency Business

Everything is beautiful, but, in practice, cryptocurrencythe company may face various obstacles to free running of business, for example, in the face of not always friendly banks. No matter how, but, these are potential competitors. And unlike the administrative bodies in Hong Kong, they are not so welcoming and loyal.

Despite the fact that there is no outright banthere is no way to work with cryptocurrencies for banks - they can still refuse a licensed cryptocurrency company to open an account. And this has been practiced since 2014.

In September 2017, Hang Seng Bank, without warning, closed the account of the major crypto exchange Gatecoin, as well as several other cryptocurrency startups. There is no truth in this world.

In general, a company that openly works with cryptocurrencies will find it somewhat problematic to open a bank account. Although, time passes and, perhaps even today, this problem is no longer relevant.

Republic of Korea [South Korea]

Despite the fact that South Korea (col.) not so long ago was in the top three countries in terms of the total turnover of cryptocurrencies - recently, the local government began to pursue a not very friendly policy towards interested investors. All states control this industry in one way or another, but not as strictly and on a large scale as South Korea. As you can see, a third of the working population who are actively investing in cryptocurrencies has seriously alarmed the government. And the situation began to change not in the most loyal direction. And all thanks to the good intentions of local regulators.

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Legislative status

There is a legal framework. Free traffic is allowed. Government attitude is moderate

Basic documents and definition of cryptocurrencies

March 5, 2020The South Korean government made cryptocurrency trading and storage absolutely legal, which required the introduction of appropriate amendments to the legislation. Changes in legislation directly concern cryptocurrency exchanges and wallets, funds, companies conducting ICOs, and other market participants. They are now required to comply with all financial reporting requirements, use only bank accounts with real names, conduct user identification (KYC) and certify information security management systems.

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Restrictions and taxes on the use of cryptocurrencies

The legislation does not provide for a general ban on the issuance, mining, ownership or trading of cryptocurrencies.

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Administrative and criminal prosecutions for cryptocurrency ownership

There are no specific penalties for owning cryptocurrency.

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Limits and taxes on cryptocurrency trading

Foreign citizens are prohibited from trading on exchanges that are registered in South Korea, and local traders were obliged to open bank accounts and conduct basic transactions through them.

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South Korea has approved a plan to introduce a tax in20% on income from trading in cryptocurrency (column "other income"), as for citizens who have earned more than ~ $ 2000 per year. Income below this amount is not taxable.

According to some experts, taxation of cryptocurrencies is more likely to harm the development of the industry in South Korea than bring tangible profits to the state treasury.

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Administrative and Criminal Prosecutions for Cryptocurrency Trading

Trading is not a prohibited activity

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Restrictions and taxes on businesses related to cryptocurrencies

Financial Services Authority (FSC) of South Koreaintroduces amendments to legislation that will require cryptocurrency services (VASPs) to disclose the identities of their clients. Additionally, in order to prevent money laundering, changes are proposed to be made to the law on the “Transfer and use of established information on financial transactions.” Now cryptocurrency services are required to use accounts linked to the real names of clients. In addition, the VASP must open a real name account with a financial institution and obtain a certificate from the Korea Information Security Agency. First of all, the innovation is aimed at compliance with the requirements of the Financial Action Task Force (FATF). The new rules are due to come into force on March 25, 2021.

In turn, the Financial Services CommissionSouth Korea (FSC) has openly banned transactions with digital assets that "pose a high risk of money laundering" (God forbid), i.e. with anonymous cryptocurrencies. The FSC calls coins such as Zcash, Monero and Dash "dark". They are certainly practically out of control.

Cryptocurrency companies will be banned from anyhigh-risk "semi-illegal" transactions related to prepaid vouchers, gift cards, points purchased with bitcoins and other altcoins.

Exchanges and banks are required to accept cryptocurrencytransfers only from verified accounts - otherwise, you face a fine. In turn, trading platforms will be required to store cryptocurrencies not in their own wallets, but at separate custodian services that provide intermediary services. It is worth keeping silent about the obligations of these services before the law.

Due to the introduction of new standards, it is expectedthe closure of a number of cryptocurrency exchanges and other related services due to significant costs. But, this situation should not affect the cryptocurrency market in any way, since Korea has already lost its leading position in terms of global digital asset turnover.

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Administrative and Criminal Prosecutions for Cryptocurrency Business

In 2018, eight of South Korea's leading crypto exchanges: Korbit, Coinone, Upbit, Coinplug, RippleForYou and Coinpi issued fines ranging from $ 10,000 to $ 25,000 due to "unsatisfactory security measures."

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In addition, local authorities openly persecutedUpbit and Bithumb exchanges. So, in December 2019, the tax office intended to collect $ 67 million from Bithumb for the transactions of its foreign clients, and Upbit was charged with falsifying trading.

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In any case, regulation is extremelyadversely affects the state of the cryptocurrency industry in South Korea. Despite the rather high popularity among the population, many trading platforms in the country are gradually declining. Although, this information may be "somewhat exaggerated". Burying the industry wherever it is is fashionable and profitable.

Singapore

Perhaps Singapore was not without reason recognized as one of themost technologically advanced countries in the world. Today, Singapore's economy is ranked as the most innovative, free, dynamic, competitive and most business-friendly. This country has the third highest per capita income in the world. Singapore dollars (SGD) are used as the currency. In general, it is a fairly well-known tax haven and practically a global financial center.

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Legislative status

There is a legal framework. Free traffic is allowed. Government attitude is positive

Basic documents and definition of cryptocurrencies

In 2020, cryptocurrency companies in Singapore, in view of the new legislation, have the opportunity to obtain licenses and continue their activities on absolutely legal grounds.

The first full-fledged regulation in the field of digitaleconomy became the Law “On Payment Services” (Payment Services Act). The law defined cryptocurrencies in the regulatory framework and provided official powersMonetary Authority of Singapore Cyber ​​Risk Oversight and Cryptocurrency Money Laundering and Terrorist Financing Control.

It looks like Singapore is clearly intent on catching up with Japan and Malta, which are considered the largest hubs for cryptocurrency companies.

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Restrictions and taxes on the use of cryptocurrencies

The legislation does not provide for a general ban on the issuance, mining, ownership or trading of cryptocurrencies.

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Administrative and criminal prosecutions for cryptocurrency ownership

There are no specific penalties for owning cryptocurrency.

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Limits and taxes on cryptocurrency trading

The Singaporean authorities show a keen interest in cryptocurrencies, therefore, they believe that the tax system should be adapted to modern needs.

Singapore's Internal Revenue Authority haspublished the main document that regulates the taxation of goods and services (GST) in the context of the use of various cryptocurrencies. In particular, those wishing to exchange cryptocurrencies for cash will no longer pay VAT tax on such transactions. The management pays special attention to such cryptocurrencies as Bitcoin, Ethereum, Litecoin, Dash, Monero, Ripple (XRP) and Zcash.

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Administrative and Criminal Prosecutions for Cryptocurrency Trading

In 2020, a Singaporean citizen was accused of unlicensed bitcoin trading and participation in money laundering resulting from online fraud.

The police clarify what the girl got onbank account several transfers totaling $ 2,400, which she then used to buy bitcoins. Transactions were made by agreement with an unknown person for a fee. This money turned out to be criminal proceeds from online fraud.

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Restrictions and taxes on businesses related to cryptocurrencies

Despite the fact that all cryptocurrency exchanges,So, must adhere to anti-money laundering and anti-terrorist financing laws - the Monetary Authority of Singapore (MAS) has proposed new, stricter rules that are in line with the Financial Task Force (FATF) standards. Thus, MAS hopes to expand its powers to the point where it can prohibit any "unfit legal entity" from doing business in Singapore. Additionally, the Monetary Authority wishes to regulate and license cryptocurrency companies that provide services outside the country.

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Administrative and Criminal Prosecutions for Cryptocurrency Business

In November 2017, the largest stateBank of Singapore DBS stated in a very original way that Bitcoin is a "Ponzi scheme". To be honest, it does not correlate too much with the general position of the local authorities. I am glad that not everything depends on the statements of the Singapore banks.

Although, on the eve of the announcement, in September 2017, Singaporean banks actually closed the bank accounts of several local cryptocurrency companies.

Kazakhstan

It should be admitted that the cryptocurrency industry inKazakhstan is developing mainly due to entrepreneurs and other interested enthusiasts. Someone does a small business aimed at a local audience, while others create projects at a global level, while being based in this hospitable country. Although, it would be unfair to ignore the efforts of the government of Kazakhstan, which is somehow trying to regulate this area and put it “at the service of the state”. However, not everyone likes the concept of decentralization, in particular, the National Bank.

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Legislative status

There is a legal framework. Free traffic is prohibited. Government attitude is extremely moderate

Basic documents and definition of cryptocurrencies

On June 25, 2020, the law “On makingchanges and additions to some legislative acts of the Republic of Kazakhstan on the regulation of digital technologies ”. Mostly, the document is aimed at "legalizing" mining and cryptocurrency. Now in the legislation of the republic there is such a concept as a "digital asset", which makes it possible to determine the general conditions for mining and the circulation of cryptocurrencies.

The following definitions are given in the law "On informatization":

“A digital asset (cryptocurrency) is a propertycreated in electronic digital form, using means of cryptography and computer calculations, which is not money, securities, derivative financial instruments, the underlying asset of which is securities, as well as a digital form of certification of property rights "

"Digital mining is the process of conductingcomputing operations with the use of computer, energy capacities according to the specified encryption and data processing algorithms, ensuring the confirmation of the integrity of data blocks in objects of informatization by means of the blockchain ”.

It is important to note that cryptocurrency is not recognized as a means of payment - it is assigned the status of property.

Authorities give the green light only to certain “cryptocurrencies” that meet the following criteria:“Cryptocurrency, as well as other types of digital assets that confirm property rights to goods and (or) services issued (provided) by the person who issued the secured digital asset.”In general, in simple terms, these are stablecoins.

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Restrictions and taxes on the use of cryptocurrencies

Consequently, such digital assets as Bitcoin, Litecoin, Ethereum and others receive the status of unsecured assets in Kazakhstan and are defined as:“Tokens received as a reward for participationin maintaining blockchain consensus in the manner prescribed by the legislation of the Republic of Kazakhstan, the issuance and circulation of such unsecured digital assets in the territory of the Republic of Kazakhstan will generally be prohibited, except in cases to be established later.”

The release and circulation of decentralized digital assets in Kazakhstan is allowed only on the territory of the Astana International Financial Center (AIFC).

Although, it is worth noting that the person carrying out digital mining becomes, in the eyes of the law, the owner of the received digital assets.

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Administrative and criminal prosecutions for cryptocurrency ownership

No precedents known

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Limits and taxes on cryptocurrency trading

Yes, the circulation of “wrong” digital assets is prohibited in Kazakhstan, but the law does not prohibit citizens from opening accounts on foreign trading platforms and receiving income.

A separate article in tax law forCryptocurrencies are not yet provided for, therefore, such income, regardless of sources and type of activity, is subject to individual income tax at a rate of 10%.

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Administrative and Criminal Prosecutions for Cryptocurrency Trading

No precedents known

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Restrictions and taxes on businesses related to cryptocurrencies

As already noted, miners have ownership of the mined digital assets. At the same time, they are obliged to inform the authorities about their activities.

At the same time, the new laws do not provide provisions that relate to the taxation of miners.

"Since mining is defined as a technologicalprocess, the developers of the draft law note that it is separated from the issues of cryptocurrency turnover and taxation of income from their sale, explaining that the income itself from the sale of mined cryptocurrencies arises when they are exchanged / sold on specialized exchanges, converted into fiat money "

According to the plan already developedThe Ministry of Economy of Kazakhstan, in the future, assumes that taxes on cryptocurrencies will be capped at 15%. Any person working with cryptocurrencies and receiving a stable income will be required to register and file a tax return on their own, indicating the appropriate income column.

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Administrative and Criminal Prosecutions for Cryptocurrency Business

In 2019In Italy, in the framework of the case initiated in Kazakhstan, the former owner of the WEX cryptocurrency exchange, Russian Dmitry Vasiliev, was detained. The police in Almaty accused him of fraud, or rather, misappropriation of a large sum of money.

It was alleged that in September 2018 DmitryVasiliev [quoted verbatim]: "By deception and abuse of trust, misleading [citizen X], not intending to carry out his proposal, he stole by fraud 20,000 US dollars."

Later, "... due to mistakes in the case" - he was released.

The details of the case of the scandalous cryptocurrency exchange Wex and the related equally interesting exchange BTC-E have long been known to a wide audience.

Uzbekistan

It all started well, and earlier in Uzbekistan there was nothere was an outright ban or permission for cryptocurrency, so some companies accepted bitcoins as payment. Profile events were held, enthusiasts waited for a warming against the backdrop of bright news, and then in Uzbekistan, the use of cryptocurrency as a means of payment was legally prohibited. They called their citizens “illiterate”, so only smart foreigners can trade on local stock exchanges. Although, maybe everything is for the best ...

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Legislative status

There is a legal framework. Free traffic is prohibited. The government's attitude is uncertain

Basic documents and definition of cryptocurrencies

In general, use cryptocurrency in Uzbekistanas a means of payment is prohibited by law. The rule was established by order of the director of the National Agency for Project Management and additionally regulates the procedure for the operation of cryptocurrency exchanges in the republic.

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Restrictions and taxes on the use of cryptocurrencies

See Restrictions and Taxes on Cryptocurrency Trading

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Administrative and criminal prosecutions for cryptocurrency ownership

No precedents known

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Limits and taxes on cryptocurrency trading

Today, officially the owners of the cryptocurrencycan sell it on one of two legal trading platforms within the country. Provided full identification of the person. True, you can only sell, but you can no longer buy. In other words, a miner can only sell a crypto to a foreigner. They were not allowed to buy currency due to the "low financial literacy of the population." Anonymous transactions are also prohibited. Apparently for the same reason.

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Administrative and Criminal Prosecutions for Cryptocurrency Trading

See Administrative and Criminal Prosecutions for Cryptocurrency Business

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Restrictions and taxes on businesses related to cryptocurrencies

The government expects to attract the largest cryptocurrency exchanges to the country and outlined the rules for their operation in the country.

At the beginning of 2019 in the countryapproved the licensing procedurecryptocurrency exchanges.They are allowed to open only by foreign companies with an authorized capital of at least 30 thousand minimum wages (more than $700,000). Servers must be located on the territory of Uzbekistan. There should not be citizens of Uzbekistan among the founders.

Cryptocurrency exchanges in Uzbekistan are required tostore information about all transactions carried out for 5 years and admit only registered and verified users over 18 years of age to trading. The administration of the exchange is obliged to provide information about a specific user at the first request of law enforcement and other authorized bodies.

Regarding the taxation of the trade turnover of cryptocurrencies, everything is in the discussion, and we are not talking about individuals, but about foreign investors.

Additionally, development is plannedcryptocurrency infrastructure in general, in particular, the establishment of the National Mining Pool. The state wants a joint initiative, which implies cooperation with both local miners and foreign partners.

For those who decide to join the Nationalthe mining pool provides a common electricity tariff, and not a triple rate, as is the case with private standalone miners. Participants are required to obtain a license and sell assets exclusively on legal, domestic trading platforms. Otherwise - triple electricity tariff.

Also, it is planned to create a special cryptocurrency legal zone - Uzbekistan Blockchain Valley, where participants, on special conditions, will be able to freely test various blockchain innovations.

Advertising of detailed projects is not prohibited whenSubject to regulatory compliance, in particular, it is prohibited to mislead potential users and to remain silent about the risks of such investments.

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Administrative and Criminal Prosecutions for Cryptocurrency Business

In June 2020In Tashkent, a criminal case was opened against a citizen for the purchase and sale of bitcoins in 2019-2020 for a total of $ 3 million. The charge was brought under Article 177 (illegal acquisition or sale of currency values) and Article 190 (engaging in activities without a license).

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In September 2020, a group of people were detained in Tashkent while trying to illegally sell 20 bitcoins for $224,000 for a 7% commission. During the arrest, $402,000 was “temporarily” seized from the “criminals.”

Conclusion

In the final fifth part of this study, weLet's take a look at countries that are also important to the entire cryptocurrency ecosystem. These are Australia, New Zealand, Malta, Israel, India, as well as hot Nigeria.

Review author: Ne-Standart supported by BitNovosti.com

In the fourth part of our series, we will go to Asia to check how well life is thereContinue reading&#8220;On the issue of national characteristics of thermorectal cryptanalysis or “Where cryptans can live well” - part 4&#8221;