As cryptocurrencies continue to spread all over the world, governments are deciding what role they want crypto to play in their economies. While some countries have chosen to ban cryptocurrencies entirely, others have seen the blockchain’s utility and embraced them. Though it’s sad to see countries shy away from the potential crypto has to offer, it’s exciting to see other countries dive into crypto headfirst. This blog will go over what countries have (and haven’t) adopted cryptocurrencies.
Most developed countries in the world have okayed cryptocurrencies to some extent. The United States and Canada have so far been friendly towards crypto, mainly focusing on regulations aimed at preventing crimes like fraud and money laundering. This has given citizens the ability to easily buy, sell, and trade currencies like Bitcoin and Etherum, as well as the ability to use their crypto to purchase NFTs, goods or services, and more. The European Union prevents member states from starting their own cryptocurrencies, but they allow crypto to exist so long as exchanges follow their regulations. Other countries that have positive views on cryptocurrency include Australia, Chile, Japan, New Zealand, Switzerland, Ukraine, Venezuela, and many more. These countries have helped foster the growth of crypto and have helped legitimize cryptocurrencies worldwide.
This past September, President Nayib Bukele of El Salvador announced that Bitcoin would be a legal currency in the country. The decision made history, making El Salvador the first country to adopt a cryptocurrency as an official currency. Bukele believes Bitcoin can help the country and its citizens in a multitude of ways. For example, Bitcoin can help El Salvadorans avoid money transfer fees when sending money in and out of the country. While this may not sound like a big deal, remittances make up a fifth of the country’s GDP, and wire transfer fees can add up quickly. Bitcoin allows El Salvadorans to avoid those costly fees and save money. Bukele also says that Bitcoin will help more El Salvadorans access the financial system, which is desperately needed since 70% of the country doesn’t even have a bank account.
So far, the country’s official crypto wallet, Chivo, already has three million downloads and 2.1 million active users. $2 million dollars a day is sent through Chivo according to Bukele.
30 Bitcoin ATMs have been set up in major US cities to send remittances and promote Bitcoin/Chivo use. The government also offered a $30 bonus for users at the beginning of the program, and many small businesses have seen an uptick in business from customers using the bonus to try out Bitcoin. Despite its hiccups, El Salvador’s Bitcoin adoption seems to be a success, one that is starting to inspire other countries.
Now, a multitude of countries, particularly in Latin America, are considering adopting Bitcoin as an official currency. Politicians from all over the region have expressed interest and support for joining El Savador in their Bitcoin endeavors. Senator Indira Kempis Martinez of Mexico expressed her support for adopting Bitcoin in a tweet that said, “First they ignore you, then suddenly Paraguay, Argentina, Panama, Brazil, El Salvador, and Nicaragua embrace #Bitcoin.” Other politicians from the countries listed by Martinez have also made similar statements in support of adopting Bitcoin. None of these countries have gone as far as El Salvador—yet. If El Salvador’s Bitcoin experiment is a success, there is no doubt other countries in the region will join in to avoid the fear of missing out. Latin America could become the proving ground for crypto, showing the benefits that widespread national adoption has.
On the other end of the spectrum, many countries have heavily restricted or criminalized cryptocurrencies. China has outright banned cryptocurrency transactions in the country, making crypto illegal nationwide. Algeria, Bolivia, North Macedonia, and more have done the same and banned cryptocurrencies entirely. Indonesia, Turkey, and Vietnam have passed laws making the use of crypto as a payment method illegal, severely hampering their use. Columbia, Egypt, Iraq, and Russia have all been increasingly restricting cryptocurrencies through heavy regulation, often preventing anyone other than licensed brokers from holding, trading, purchasing, or selling crypto. Even though these countries have tried to ban crypto, the decentralized nature of cryptocurrencies makes a ban incredibly hard to enforce. As a result, many have continued to trade crypto despite the ban.
Though many dream of a future where crypto is legal everywhere, that is not yet a reality. Before buying or trading cryptocurrencies, be sure to check your country’s laws and regulations to avoid any potential legal issues. Hopefully, more countries follow in the footsteps of El Salvador, and worrying about the legality of crypto will be a thing of the past.