If you’re thinking of starting a new Cryptocurrency venture in 2021, your location could prove to be the most vital business decision you have to make.
As Cryptocurrencies become more popular, many governments worldwide remain undecided on how to approach the industry. Some are more open towards integration and see the benefit of crypto companies operating in their country, with the remainder sceptical and even hostile towards the industry in general.
As such, it pays to do your research into regulations and government policies in many different locations. There are also many other aspects to consider, including taxation, potential future regulation and the existing infrastructure of Crypto-related businesses.
Now, as Governments continue to learn more about the industry, some countries are proving to be hotspots when setting up a Cryptocurrency based business.
The following crypto-friendly countries are all serious contenders, providing everything you need to succeed—
Malta’s forward-thinking approach has helped secure its spot as a global leader for Crypto businesses. The Maltese government was the first to introduce a regulatory framework for Cryptocurrencies through the MFSA (Malta Financial Services Authority), along with blockchain legislation legalising Cryptocurrency exchanges through the VFA act.
It also introduced three new bills in 2018 to help build confidence and attract attention to the growing Crypto Markets there. The bills focus on Distributed Ledger Technology (DLT) regulation and cover digital innovation (MDIA), technology service providers (TAS) and virtual currencies (VC).
VAT doesn’t apply to transactions exchanging fiat currency for crypto and Malta also has the lowest corporate tax rate, 0%, in the EU, making it an appealing prospect for the industry.
The positive regulations for virtual currencies have been accepted with open arms, as the largest global exchange, Binance, recently moved headquarters from Hong Kong to Malta. It has also attracted other large companies such as OKEx to relocate there, further cementing the growing popularity of Malta to prospective Cryptocurrency entrepreneurs.
Much like Malta, Switzerland is another European destination that is proving itself to be a hotspot for Cryptocurrency businesses. The success has emerged from the small town and canton of Zug and the inception of “Crypto Valley”, which is the headquarters of many crypto-firms and businesses including Etheruem, Bitcoin Suisse and ConsenSys.
Their progressive approach to crypto regulations and a minimal tax rate of 14.6% has helped transform Zug into an integrated “ecosystem” of Crypto businesses through the Crypto Valley Association, which was formed in 2017.
The collective wealth of the top 50 Cryptocurrency and blockchain-related companies in Switzerland’s “Crypto Valley” is said to be worth over $40 billion, a staggering amount considering the relative infancy of the Cryptocurrency industry.
In February 2021, Zug announced that residents can pay taxes and municipal services using Bitcoin and Ethereum, alongside everyday transactions such as transport and other public services.
The government provides a business-friendly framework that oversees Cryptocurrency regulation and sophisticated infrastructure for businesses to thrive, which further encouraged the top names and businesses in Cryptocurrency to set up shop in Zug.
In Switzerland, Cryptocurrencies and exchanges are legal, and the SFTA (Swiss Federal Tax Administration) to be an asset, meaning they are subject to Swiss wealth tax and declared on yearly tax records.
A recent resurgence in US-based interest has made the USA one of the best countries to start a Cryptocurrency business. U.S. based companies include market-leaders such as Coinbase, Gemini, Circle and Celsius, all of which have been a driving force for recent Cryptocurrency adoption and use in their respective sectors.
Regulation has been a hot topic in the U.S for Cryptocurrencies, with uncertainty creating unwanted negative attention towards the industry. However, the SEC recently announced that major Cryptocurrencies are to be classified as commodities, paving the way for more open trading and Crypto-based financial products such as Futures and ETF markets to be introduced.
The traditional financial sector has also contributed greatly to mainstream Cryptocurrency adaptation, with institutional buyers including MicroStrategy, Tesla and Grayscale purchasing large amounts of Bitcoin with the view for long-term investment and growth.
Wall Street giants such as Goldman Sachs, Citigroup and BlackRock are also looking to get involved, an extremely promising sign for the future of Cryptocurrencies in the USA.
Hubs like the infamous “Crypto valley” are now emerging in key tech hotspots in the US, namely New York and Silicon Valley. With growing interest in the industry and an already established tech and education infrastructure, it’s clear that the USA are on track to cement their position as a market-leading location for Cryptocurrency businesses looking to thrive.
Japan has always been at the forefront of the Cryptocurrency industry, becoming a coveted location for Cryptocurrency businesses due to its approach to legalization, regulation and integration of Cryptocurrencies.
Japan was infamously one of the first and only countries to recognize Cryptocurrencies as legal tender, with many businesses and restaurants now starting to accept crypto as payment.
Tokyo is said to be the world’s most active Cryptocurrency trading market, with many crypto exchanges based in Tokyo and many Crypto-based businesses headquartered there too. Japan is well-known for being the birthplace of the infamous creator of Bitcoin, Satoshi Nakamoto, which is a Japanese pseudonym. It also spawned the world’s first major Crypto (Bitcoin) exchange, Mt. Gox, which unfortunately shut down amid various controversies.
Japan’s Financial Services Agency has been working on a draft to further regulate existing crypto businesses in the nation, as well as authorising sixteen of their biggest crypto exchanges to form a self-regulatory body, which is extremely promising for crypto-based businesses.
The number of crypto companies in Japan is also growing quickly. In December 2020, 190 companies expressed an interest in setting up a business. The tech-savvy country has proven itself a front-runner for the Cryptocurrency ecosystem, with many looking to take full advantage of the friendly regulatory environment and operate there.
The most luxurious location on the list, Seychelles is proving itself as a hotspot for the industry due to attractive regulations for businesses including favorable tax treatment and relative ease of governance when setting up businesses.
Market-leading exchanges such as Bitmex, Huobi and Kucoin are registered in the Seychelles thanks to favourable regulations towards exchanges and Cryptocurrency businesses. It’s now looking to promote itself as the next crypto hub and attract the attention of more market-leading Crypto businesses.
Seychelles is also home to Drixx, a new, promising crypto derivatives exchange and Yield Platform. Drixx Yield is a Crypto finance provider that helps you earn higher yields on your assets, offering market-leading average APYs on stablecoins of up to 18.6% through its intuitive, user-friendly interface.
Offering military-grade security, highly regulated risk policies and daily interest yields, Drixx is proving itself to be a market-leading platform and a driving force behind the growth of Seychelles’ Crypto industry.
Setting up an account on Drixx is simple:
- Open a free account
- Transfer funds in one of the supported coins (USDT/USDC)
- Start earning best-in-class yields of up to 18.6% on your assets.