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What Are the Most Crypto-Friendly Countries in the World?

Cryptocurrency has come a long way in the 13-odd years since the launch of Bitcoin. Initially regarded as a Wild West of stateless money, the sector is increasingly shedding much of its bad reputation, with many countries now passing legislation that reserves a place for cryptocurrency within existing financial and economic frameworks.

Yes, cryptocurrency remains illegal in certain parts of the world, but a growing number of nations are going to great lengths to create a favorable environment for crypto and attract investment from the industry. Accordingly, this article surveys the most crypto-friendly countries in the world, explaining what each is doing to welcome and nurture crypto. It will also highlight how, as a whole, the direction of travel is towards more acceptance of cryptocurrencies, as well as towards their greater integration within the global economy.

Portugal is surprisingly welcome to crypto enthusiasts

El Salvador

Having officially made bitcoin legal tender in September 2021, El Salvador is easily one of the most crypto-friendly countries in the world. Its raising of BTC to the status of legal tender means shops and other businesses are legally obligated to accept the cryptocurrency as payment to settle debts, unless they lack the technological means of doing so.

In addition to making BTC legal tender, the government of El Salvador has also been focused on attracting investment from the cryptocurrency sector, and it has been steadily accumulating the currency (even during the ongoing 2022 bear market). Most notably, it outlined plans in November to develop a ‘Bitcoin city’ funded by the sale of $1 billion in bonds.

In terms of how El Salvador treats crypto for tax purposes, it currently has no income or capital gains tax on bitcoin, making it very friendly for investors.


An EU member state, the island of Malta gained a level of recognition in July 2018 when its parliament passed three bills into law that established a positive regulatory framework for cryptocurrency and blockchain technology. Its lawmakers dubbed the “world’s first blockchain island” as a result, with major exchange Binance establishing a base in the European nation in 2019 (although it never gained an official license to operate under Maltese law).

While Malta aims to grow its blockchain sector so that it accounts for 10% of its GDP by 2027, the rigor of its laws has meant that many prospective cryptocurrency firms gave up on getting licensed. Still, this sector has raised in the region of €141 million to date, according to a recent report from the EU Blockchain Observatory and Forum.


While it hasn’t passed any comprehensive cryptocurrency legislation as of writing, Singapore currently stands as one of the most permissive and supportive jurisdictions for the cryptocurrency sector in the world.

A clear indicator of this is the fact that investment in the city-state’s blockchain and cryptocurrency businesses amounted to $1.48 billion in 2021, nearly half the total for the entire Asia Pacific region. At the same time, 6% of the world’s crypto-focused funds are located in the republic, putting it third overall (behind the US and the UK).

Indeed, its openness towards crypto means that a number of big companies, such as US-based exchange Gemini, have set up their regional Asia HQ in the country. At the same time, around 10% of its population reportedly own some kind of crypto.

That said, the Singaporean government has begun considering tightening regulation in recent months, given the spectacular collapse of firms such as the (Singapore-based) Three Arrows Capital and Terra Labs. It also passed legislation in 2020 subjecting cryptocurrency to income tax.


Portugal is one of the most crypto-friendly countries in the world by virtue of taking a laissez-faire stance towards taxing cryptocurrency investors. While income earned in crypto is subject to income tax, there’s no capital gains tax imposed on profits earned from trading and investing.

Such is Portugal’s friendliness towards crypto that the blockchain sector now accounts for 17% of the overall funding raised by fintech companies within the EU member state, with over €1 billion already raised in 2022, compared to £437 million in 2021.

However, there are plans to introduce a 28% capital gains tax in the country’s budget for 2023, although this covers only cryptocurrencies held for under a year.


Long regarded as a safe haven for money, Switzerland has also been evolving into a haven for cryptocurrency, with the German-speaking canton of Zug establishing itself as a ‘crypto valley’ as early as 2018. In fact, Zug’s fifty biggest cryptocurrency and fintech companies were worth just over $250 billion in early 2021, according to a report from Zug-based venture capital firm CV VC.

More generally, other parts of Switzerland have also made an effort to attract cryptocurrency investment, with Lugano famously announcing in early 2022 that it would begin accepting stablecoin tether (USDT) and bitcoin as a legitimate means of paying taxes. The Italian-speaking canton will also be encouraging stores and businesses to accept crypto as payment.

Switzerland imposes no capital gains taxes on cryptocurrency investments (so long as you’re not a professional trader), although income tax does apply to revenue generated by mining.


Perhaps an unexpected entry on this list, Lithuania is nonetheless one of the most crypto-friendly countries in the world. It has established a liberal framework for crypto-related businesses within its borders, becoming one of the first EU nations to provide regulations for initial coin offerings in 2018.

Thanks to its proactive stance, it counts a number of significant blockchain-related startups (31 according to the EU Blockchain Observatory), which together have raised just in excess of €1.1 billion to date.


Yet another EU member state, Germany has taken the lead over other developed nations in introducing regulation that supports crypto while also protecting consumers. On January 1, 2020, it amended its Banking Act in order to account for cryptocurrencies, requiring firms seeking to keep custody of virtual currencies to gain licensing from BaFin.

This early start in adapting to crypto has meant that the national blockchain sector in Germany has grown steadily, with major savings bank Sparkasse rolling out bitcoin trading for its 50 million customers this year. Cryptocurrency trading and purchases are perfectly legal, while cryptocurrencies held for more than a year are not subject to capital gains tax.

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CryptoVantage Author Simon Chandler

About the Author

Simon Chandler

Simon Chandler is a journalist based in London. He writes about technology, markets and politics, and has bylines for Forbes, Digital Trends, CCN, Wired, TechCrunch, the Verge, the Sun, the New Internationalist, and TruthOut, among many others. His Twitter handle is @_simonchandler_

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