This Country Becomes Europe’s Accidental ‘Bitcoin Heaven’

As governments around the world watch the advance of cryptocurrencies with suspicion, one country on the European continent has emerged as a crypto haven.

Portugal, a southern European country bordering Spain, has become a haven for bitcoiners, according to a report by the AFP news agency.

Currently, Portugal is one of the last countries in Europe to consider cryptocurrencies as currencies from a tax point of view, which means that trading profits are not taxed.

“You don’t have to do anything else because you already have a perfect system, with zero percent tax on bitcoin,” said Didi Taihuttu, a prominent crypto enthusiast who has since moved his family to Portugal. the Netherlands.

The agency said the country has long sought foreign cash by granting tax breaks and special visas to foreign investors and so-called digital nomads – those who work online without needing a fixed place of business. .

And the tax regime isn’t the only draw – beaches, climate and cuisine all feature, especially for people living in northern Europe.

Portugal’s finance ministry is looking into the situation and wants a common European framework, but pressure is mounting for quick action.

Far-left MP Mariana Mortagua recently called for urgent regulation and summed up the situation bluntly: “Portugal has become a tax haven”.

If internal pressures do not force the hand of the Portuguese government, intervention could come from outside.

The European Central Bank’s Fabio Panetta sounded the alarm bells on crypto late last month when he said the ecosystem was showing “surprisingly similar dynamics” to the subprime mortgage bubble that contributed sink the world economy in 2007.

Crypto-assets now have a market capitalization well above the $1.3 trillion in bad debt that triggered the global financial crisis.

He accused ‘crypto evangelists’ of promising ‘heaven on earth’ while peddling a glorified Ponzi scheme – because crypto-assets are generally not backed by any revenue streams, they rely on money from new investors to keep prices high.

If new investors dry up, asset prices crash.

(With AFP inputs)

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Mary I. Bruner