Time To Find Out If Bitcoin Is Legal In Your Country
Our synopsis and notes.
This article addresses the legality of Bitcoin. It would have been better if it addresses the legality of cryptocurrencies in general instead of just Bitcoin.
Investors, traders and users of cryptocurrencies need to be careful of the legal status of cryptocurrencies in their jurisdiction before dealing with them. Failure to do so may mean trouble with the authorities and possibly even loss of their investments.
When we speak of legality of cryptocurrencies we are dealing with several scenarios as follows:
Cryptocurrencies are absolutely illegal and holding them or dealing with them is illegal.
Cryptocurrencies are not legal for extinguishing your debt with someone with payment in cryptocurrencies (i.e. is not legal tender) but otherwise is legal for all other purposes such as investment and transactions where no debt is due or transactions where parties have contracted to make payment for the price or debt expressed in legal currency but payable in equivalent value in cryptocurrencies. Thus in such cases it is recognized as money but not local currency which is the legal tender. Usually in this category, the authorities would recognize cryptocurrencies as a type of commodity or property.
Image by HealthWyze from Pixabay and modified by @invest.country
- Cryptocurrencies are recognized as legal tender in which case it is legal and usable as equivalent to local currency.
In scenario 2 and 3 above, the specific tax laws of the particular jurisdiction would have to be looked into to decide how profits earned from cryptocurrency investments and trading would be taxed.
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