Belarus is the first in the world to integrate cryptocurrencies in the law.
Belarus joins a group of states where cryptocurrencies are fully or partially legalized. Already on March 28, the country officially allows the purchase, sale, exchange, and mining of virtual money.
So Belarus intends to use the global interest in crypto-loans with the benefit of the budget. The key document regulating the cryptosphere was the decree “On the development of the digital economy”, on March 28 it comes into force. The decree refers mainly to the Park of High Technologies, which is positioned as an analog of the Silicon Valley in the United States and has been operating for 12 years. On its territory and legalized crypto-currencies. The turnover of the companies working in the Park is about one billion dollars.
The decree actually authorizes buying, selling and exchanging cryptocurrencies, working as a crypto platform operator or an exchange bureau operator and in other areas in the field of brokers and cryptocurrencies. In February, Belarusian Prime Minister Andrei Kobyakov noted that the authorities will not allow circulation of crypto-currency outside the Park.
Paradise for crypto man?
The residents of the Park will be able to conduct transactions through a smart contract (program code for commercial operations in the blockchain). His definition appears in the legislation of Belarus, says senior partner of the law firm Aleinikov and Partners and a member of the Council for the Development of the Digital Economy of Belarus Denis Aleinikov. “Fizlitsa will be able to carry out mining, we are allowed to store tokens legally in virtual wallets, allowed to exchange, acquire, dispose of them for money, give and bequeathed,” – lists Aleinikov.
But the token will not become a means of payment
– here the positions of the Belarusian and Russian authorities converge. At the same time, until 2023, incomes of individuals from operations with crypto-currencies and from mining will be exempted from taxes. Many large holders of crypto-currencies turn to Belarusian lawyers with the issue of obtaining a tax residency in the country, for the state it is more interesting than small incomes of natural persons, the lawyer specifies.
Also in the High-Tech Park, ICO operators can be created (attracting investments for various projects using cryptocurrency).
They will launch ICO-projects of their customers and consider them in terms of legality, structuring and combating money laundering
Aleynikov said. In addition, there will be crypto-exchange and mining operators in the Park. But the decree does not establish clear rules for ICO-operators and crypto-instruments, this role is assigned to the crypto community itself. The filter for bona fide companies will be the registration procedure in the Park – it will have a permissive nature, emphasizes Aleinikov. There will be no taxation in the special zone, companies should pay only one percent of revenue, and the stability of this legal regime is guaranteed by the state until 2049. The key goal is to turn the Park into an international knowledge center. “If a resident invites a foreigner to work, he can come without a visa from any country for 180 days, and work permits and residence permits are also revoked,” Aleynikov said.
The National Bank of Belarus will take the exit from the cryptocurrency in the fiat money. Crypto operators will receive the status of high-risk customers on a par with casino operators and lotteries. But automatic obstacles to the withdrawal of funds does not mean that.
Liberalization of cryptocurrencies in the world is very gradual, and now the full or partial legal definition of crypto-currencies and transactions with them is provided by Japan, the United States and Canada, says Digital Finance CEO Vitaly Tsigulev. Full or partial legalization and the ability to pay for goods and services with crypto-currencies is also possible in Switzerland, Denmark, Germany, the Czech Republic and Norway. In this case, operations with cryptocurrencies are taxed even in countries where their legal status is not defined. “Belarus is the first country to provide a comprehensive definition of the crypto-currency sphere in the legal field while placing crypto projects on the basis of the High-Tech Park protects investors from fraud,” Tsigulev said.
The risks of Belarus are comparable with the global ones – the blockade as a technology has huge prospects, but the future of individual crypto-currencies is not yet clear, Tsigulev continues. Therefore, he says, there is a risk of getting a return from Park and the decree later than planned.
According to the founder of the blockhouse Universal Alexander Borodich, the decree will remove the crypto-currency market in Belarus. “Japan, for example, being one of the first countries in which to meet the cryptocurrencies, recently announced the need to tighten the regulation of the crypto-currency to exclude money laundering so that the attackers could not use the flaws in their favor,” Borodich said.