The legal status of cryptocurrencies varies substantially from one jurisdiction to another, and is still undefined or changing in many of them.Assessing the Differences in Bitcoin & Other Cryptocurrency Legality Across National Jurisdictions Information Systems & Economics eJournal. Social Science Research Network (SSRN). Accessed 25 September 2017. While in the majority of countries the usage of cryptocurrency is not in itself illegal, its status and usability as a means of payment (or a commodity) varies, with differing regulatory implications.Crypto's Biggest Legal Problems Crypto Law Review. Accessed 25 September 2018.

Detail by intergovernmental organization

Country or territory Legality Notes The European Union has passed no specific legislation relative to the status of bitcoin as a currency, but has stated that VAT/GST is not applicable to the conversion between traditional (fiat) currency and bitcoin.

VAT/GST and other taxes (such as income tax) still apply to transactions made using bitcoins for goods and services.

In October 2015, the Court of Justice of the European Union ruled that "The exchange of traditional currencies for units of the 'bitcoin' virtual currency is exempt from VAT" and that "Member States must exempt, inter alia, transactions relating to 'currency, bank notes and coins used as legal tender, making bitcoin a currency as opposed to being a commodity. According to judges, the tax should not be charged because bitcoins should be treated as a means of payment.

According to the European Central Bank, traditional financial sector regulation is not applicable to bitcoin because it does not involve traditional financial actors. Others in the EU have stated, however, that existing rules can be extended to include bitcoin and bitcoin companies.

The European Central Bank classifies bitcoin as a convertible decentralized virtual currency. In July 2014 the European Banking Authority advised European banks not to deal in virtual currencies such as bitcoin until a regulatory regime was in place.

In 2016 the European Parliament's proposal to set up a taskforce to monitor virtual currencies to combat money laundering and terrorism, passed by 542 votes to 51, with 11 abstentions, has been sent to the European Commission for consideration.

In January 2022, Erik Thedéen, vice-chair of the European Securities and Markets Authority, called for an EU ban on proof of work crypto-mining to favor the proof of stake model and fight climate change.

It is planned to ban privacy-focused cryptocurrencies (like Monero and Zcash) in 2027.

In 2024, the European Union got new regulation and a a new directive, which affects cryptocurrencies. G7 In 2013 the G7's Financial Action Task Force issued the following statement in guidelines which may be applicable to companies involved in transmitting bitcoin and other currencies, "Internet-based payment services that allow third party funding from anonymous sources may face an increased risk of [money laundering/terrorist financing]." They concluded that this might "pose challenges to countries in [anti-money laundering/counter-terrorist financing] regulation and supervision".

Detail by country or territory

Africa

Northern Africa Country or territory Legality Notes According to the official journal (28 December 2017):

Art. 117. — The purchase, sale, use, and holding of so-called virtual currency is prohibited. Virtual currency is that used by internet users via the web. It is characterized by the absence of physical support such as coins, notes, payments by cheque or credit card. Any breach of this provision is punishable in accordance with the laws and regulations in force. "Individuals, banks, and other financial institutions are prohibited from dealing in cryptocurrencies." On 20 November 2017 the exchange office issued a public statement in which it declared, "The Office des Changes wishes to inform the general public that the transactions via virtual currencies constitute an infringement of the exchange regulations, liable to penalties and fines provided for by [existing laws] in force."

The following day, the monetary authorities also reacted in a statement issued jointly by the Ministry of Economy and Finance, Bank Al-Maghrib and the Moroccan Capital Market Authority (AMMC), warning against risks associated with bitcoin, which may be used "for illicit or criminal purposes, including money laundering and terrorist financing".

On 19 December 2017, Abdellatif Jouahri, governor of Bank Al-Maghrib, said at a press conference held in Rabat during the last quarterly meeting of the Bank Al-Maghrib's Board of 2017 that bitcoin is not a currency but a "financial asset". He also warned of its dangers and called for a framework to be put in place for consumer protection.

Western Africa Country or territory Legality Notes As of 17 January 2017, The Central Bank of Nigeria (CBN) has passed a circular to inform all Nigerian banks that bank transactions in bitcoin and other virtual currencies have been banned in Nigeria.

Later on, a committee was set up by the Central Bank of Nigeria (CBN) and the Nigeria Deposit Insurance Corporation (NDIC) to look into the possibility of the country adopting the technology driving bitcoin and other digital currencies – blockchain. The committee has submitted its report but "several sub-committees are still working on the issue" according to the Director, Banking & Payments System Department at CBN, Mr. ‘Dipo Fatokun.

On 5 February 2021, The Central Bank of Nigeria issued a circular informing financial institutions in Nigeria that sequel to their circular in January 2017, dealing in cryptocurrency or facilitating payment for same remains prohibited and would attract a stiff penalty.

East and Central Africa Country or territory Legality Notes While not officially banned, the Bank of Tanzania advises not to use cryptocurrency, stressing that the Tanzanian shilling is the only acceptable legal tender. On 22 April 2022 parliament of the Central African Republic voted for the cryptocurrency law which was promulgated on 27 April officially making Bitcoin a legal tender in the country.Central African Republic adopts bitcoin as legal currency , 27 April 2022 In April 2023, the CAR agreed to repeal the adoption of Bitcoin as legal tender.

Southeast Africa Horn of Africa Indian Ocean States Country or territory Legality Notes The Financial Services Commission of Mauritius considers cryptocurrencies to be regulated as a Digital Asset under the Financial Services Act 2007, and while it cautions investors they are not protected by any statutory compensation agreements, they are legal.

Southern Africa

Country or territory Legality Notes While government officials have advised against the use of bitcoin, there is no legislation against it and it remains fully legal. In December 2014 the Reserve Bank of South Africa issued a position paper on virtual currencies whereby it declared that virtual currency had "no legal status or regulatory framework". The South African Revenue Service classified bitcoin as an intangible asset. In September 2017 the Bank of Namibia issued a position paper on virtual currencies entitled wherein it declared cryptocurrency exchanges are not allowed and cryptocurrency cannot be accepted as payment for goods and services. The Reserve Bank Of Zimbabwe has banned the banking use of crypto currency, however the High Court Order lifted the ban. The Reserve Bank have filed a notice of objection with the Court. However, no source indicating a resolution of the matter was located.

Americas North America

Country or territory Legality Notes Companies dealing in virtual currencies must register with the national financial intelligence agency Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), implement compliance programs, keep the required records, report suspicious or terrorist-related transactions, and determine if any of their customers are "politically exposed persons."

The law applies to non-Canadian virtual currency exchanges if they have Canadian customers. Banks may not open or maintain accounts or have a correspondent banking relationship with companies dealing in virtual currencies if that company is not registered with FINTRAC.

Dealers in digital currency are regulated as money services businesses.

The Autorité des marchés financiers (AMF), the financial regulator in the province of Quebec, has declared that some bitcoin related business models, including exchanges and ATMs, are regulated under its current MSB Act.

As of April 2018, the Bank of Montreal (BMO) announced that it would ban its credit and debit card customers from participating in cryptocurrency purchases with their cards. This is following another banking ban in Canada from Toronto-Dominion Bank (TD). The U.S. Treasury classified bitcoin as a convertible decentralized virtual currency in 2013. The Commodity Futures Trading Commission (CFTC), classified bitcoin as a commodity in September 2015. Per the Internal Revenue Service (IRS), bitcoin is taxed as a property.

Bitcoin was mentioned in a U.S. Supreme Court opinion (in the case of Wisconsin Central Ltd. v. United States) on 21 June 2018. In an opinion, the U.S. Supreme Court mentioned that the definition of money has changed over time and that "perhaps one day employees will be paid in Bitcoin or some other type of cryptocurrency..."

If money services businesses, including cryptocurrency exchanges, money transmitters, and anonymizing services (known as "mixers" or "tumblers") do a substantial amount of business in the U.S., according to Financial Crimes Enforcement Network (FinCEN) director Kenneth Blanco in 2018, they are required to: register with the U.S. FinCEN as a money services business design and enforce an anti-money laundering (AML) program, and keep appropriate records and make reports to FinCEN, including Suspicious Activity Reports (SARs) and Currency Transaction Reports (CTRs)

, U.S. FinCEN had been receiving more than 1,500 SARs per month involving cryptocurrencies. Seventeen other countries have similar AML requirements.

In September 2016, in a federal court case involving a person operating an unlicensed money transmitting businesses, the U.S. District Court for the Southern District of New York ruled that "Bitcoins are funds within the plain meaning of that term. Bitcoins can be accepted as a payment for goods and services or bought directly from an exchange with a bank account. They therefore function as pecuniary resources and are used as a medium of exchange and a means of payment." Bitcoin was legal in Mexico as of 2017, with plans to regulate it as a virtual asset by the FinTech Law.

Central America Country or territory Legality Notes In October 2017, the Central Bank of Costa Rica issued a statement that Bitcoin and cryptocurrencies are not considered currencies, are not backed by law, and cannot be traded on Costa Rica's national payment system. The Central Bank emphasized that anyone who used cryptocurrency did so at their own risk.

Bitcoin was made legal tender in the country through the Bitcoin Law, which was passed on 8 June 2021,El Salvador, primer país del mundo en reconocer al Bitcoin como moneda de curso legal , 9 June 2021, official website of the Legislative Assembly of El Salvador and took effect on 7 September 2021.

During the first month, the Salvadoran Foundation for Economic and Social Development reported that 12 percent of Salvadoran consumers have used the cryptocurrency, however, 93 percent of companies surveyed reported receiving no payments in bitcoin. As of 2014, the government had not passed any regulation on Bitcoin, nor had the central bank issued rulings or guidelines. In January 2014, El Nuevo Diario reported that an American banker had used bitcoin to purchase real estate in the country.

Caribbean