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World Government Stance on Crypto

All information is provided to the best of my knowledge and sources at the time of writing. Please Do Your Own Research (DYOR) to verify, and seek professional assistance in your country related to your Taxation requirements if required. 

Gov's Go Pro on Crypto

Below is a list of countries with governments that have shown pro-crypto, blockchain, and Web3 policies, aiming to foster innovation and position themselves as global hubs. I’ve focused on recent government actions, regulatory clarity, and tax policies that support the industry, using credible sources where possible, preferably from government or reputable publications. The goal is to provide clear, factual information to counter misinformation or mistrust about crypto and Web3, showing that governments are increasingly supportive. I’ve included the UK, USA, China, Japan, Switzerland, Malta, Hong Kong, Singapore, Thailand, and Malaysia, Estonia, UAE and Portugal.

 

For each, I’ll highlight policies, tax positions, and any notable distinctions (like the UK banks’ stance).

Links to government sources or reliable reports are provided for transparency.

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1. United Kingdom (UK)

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  • Pro-Crypto Stance: The UK government is actively working to become a global crypto hub. In 2022, the government announced plans to regulate stablecoins and make the UK a center for crypto innovation. The Financial Services and Markets Act 2023 includes provisions to bring crypto assets under regulatory oversight, ensuring consumer protection while encouraging growth. The government has also consulted on a Digital Securities Sandbox to test blockchain-based financial instruments.

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  • Tax Position: Crypto is treated as property, subject to Capital Gains Tax (12.5-25% for individuals, depending on income) and Income Tax for trading or mining profits. The tax regime is clear, not punitive, aiming to balance revenue with innovation. HM Revenue & Customs (HMRC) has detailed guidance on crypto taxation. 

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  • UK Banks vs. Government: While the government is pro-crypto, some UK banks (e.g., HSBC, NatWest) have restricted crypto transactions due to fraud concerns, creating a perception of anti-crypto sentiment. This is a banking sector issue, not government policy. The Financial Conduct Authority (FCA) supports regulated crypto businesses, and the government is pushing for clearer banking access for crypto firms.

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2. United States (USA)

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  • Pro-Crypto Stance: The U.S. has a mixed but increasingly supportive stance, varying by state and administration. The SEC and CFTC regulate crypto, with recent approvals of Bitcoin and Ethereum ETFs (2024) signaling acceptance. States like Wyoming and Texas have passed crypto-friendly laws, including blockchain-based business licenses and tax exemptions for certain crypto transactions. The Biden administration’s 2022 Executive Order on digital assets called for innovation alongside consumer protection.

  • Trumps Executive Orders, Crypto Reserve, changes in classifications are all happening right now

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  • Tax Position: Crypto is treated as property, with capital gains tax (0-37%, depending on income and holding period) and income tax on mining or staking. The IRS provides clear guidance, encouraging compliance without stifling growth. Some states, like Wyoming, have no state capital gains tax.

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3. China

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  • Pro-Crypto Stance: China has a complex stance. It banned crypto trading and mining in 2021 to curb financial risks but supports blockchain technology. The government is developing a central bank digital currency (e-CNY) and funds blockchain research. Hong Kong, a Special Administrative Region, operates independently (see below), but mainland China’s blockchain focus suggests openness to Web3 innovation under strict control.

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  • Tax Position: Crypto trading is largely prohibited, so tax policies are unclear. Blockchain-related businesses face standard corporate taxes, with no specific incentives.

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4. Japan

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  • Pro-Crypto Stance: Japan is a pioneer in crypto regulation, recognizing Bitcoin as a legal payment method since 2017 under the Payment Services Act. The Financial Services Agency (FSA) licenses crypto exchanges, ensuring security while fostering innovation. Japan’s Web3 strategy includes blockchain for supply chains and NFTs, aiming to lead in digital finance.

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  • Tax Position: Crypto gains are taxed as miscellaneous income (15-55%, depending on income), which is high but transparent. Long-term holdings don’t receive preferential rates, but the clarity supports adoption.

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5. Switzerland

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  • Pro-Crypto Stance: Known as “Crypto Valley” in Zug, Switzerland has a robust regulatory framework via the Swiss Financial Market Supervisory Authority (FINMA). Crypto is recognized as an asset, with clear rules for ICOs and exchanges. The government supports blockchain startups through tax incentives and innovation hubs.

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  • Tax Position: Individual crypto gains are exempt from capital gains tax, though professional trading or mining is taxed as income (progressive rates, ~0-40%). A small wealth tax (0.5-0.8%) applies to crypto holdings, but the overall regime is lenient.

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6. Malta

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  • Pro-Crypto Stance: Dubbed “Blockchain Island,” Malta passed the Virtual Financial Assets Act (2018), regulating crypto and blockchain businesses. The Malta Digital Innovation Authority (MDIA) oversees innovation, attracting firms like Binance. The government aims to lead in Web3 through clear laws and startup support.

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  • Tax Position: Long-term crypto holdings are exempt from capital gains tax; frequent trading is taxed as business income (up to 35%). Structures like refunds reduce effective corporate tax rates, making it attractive for businesses.

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7. Hong Kong

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  • Pro-Crypto Stance: Hong Kong is positioning itself as a crypto hub, distinct from mainland China. The Securities and Futures Commission (SFC) licenses crypto exchanges, and a 2024 stablecoin sandbox fosters innovation. The government supports Web3 startups via grants and regulatory clarity.

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  • Tax Position: No capital gains tax for long-term crypto investments; income from frequent trading or businesses is taxed at standard rates (15-17% for corporations). The territorial tax system benefits crypto investors.

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8. Singapore

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  • Pro-Crypto Stance: Singapore is a global fintech leader, with the Monetary Authority of Singapore (MAS) regulating crypto under the Payment Services Act. Projects like Ubin explore blockchain for CBDCs, and the government funds Web3 startups. Clear rules attract exchanges like Coinbase.

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  • Tax Position: No capital gains tax on crypto for individuals; trading or business income is taxed (0-22% for individuals, 17% for corporations). Crypto payments are treated as barter, avoiding GST in many cases.

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9. Thailand

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  • Pro-Crypto Stance: Thailand’s Securities and Exchange Commission (SEC) regulates crypto exchanges and ICOs, balancing innovation with consumer protection. The government promotes blockchain for tourism and supply chains, aiming to grow digital finance. Public crypto ownership is high (~10%). 

  • Thailand is piloting crypto payments, particularly in Phuket, to encourage their use by foreign tourists. The pilot project, announced by Prime Minister Pichai Chunhavajira, aims to make large purchases easier and boost the local economy by allowing tourists to use digital currencies like Bitcoin. This initiative is designed to operate within the existing legal framework, simplifying the process for tourists to use crypto as cash in Phuket.

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  • Tax Position: Crypto gains are subject to a 15% capital gains tax, but enforcement is lenient for individuals. Businesses face standard income tax. The government is revising rules to clarify taxation.

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10. Malaysia

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  • Pro-Crypto Stance: Malaysia regulates crypto as securities under the Securities Commission (SC), with licensed exchanges operating since 2019. The government supports blockchain for Islamic finance and supply chains, aiming to grow the digital economy.

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  • Tax Position: Crypto held as an investment is exempt from capital gains tax; frequent trading is taxed as income (0-30% for individuals). The lack of capital gains tax encourages long-term holding.

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Additional Pro-Crypto Countries

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Notes:

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  • Why Governments Support Crypto: These countries see blockchain and Web3 as drivers of economic growth, job creation, and technological leadership. Clear regulations reduce risks like fraud, making crypto safer for users.

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  • Countering Misinformation: Perceptions of anti-crypto stances often stem from banking restrictions (as in the UK) or partial bans (like China’s trading ban), but governments are increasingly embracing blockchain’s potential. For example, China’s blockchain investments show it’s not anti-Web3, just tightly controlled.

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  • Encouraging Exploration: Highlighting tax benefits (e.g., no capital gains in Singapore, Switzerland) and government-backed initiatives (e.g., Malta’s MDIA, Singapore’s Ubin) shows official support, reducing fear of illegality or instability.

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