Germany, one of the largest economies in Europe, is undoubtedly not considered a particularly pro-Bitcoin country. However, for many years the country has taken a positive stance in investing in the blockchain and crypto sector by introducing increasingly progressive legislation. In addition, Germany has the highest number of Bitcoin nodes in the world, second only to the United States, reflecting a strong commitment to the blockchain and crypto industry in general.
In the past, Germany, like Portugal, had implemented a national blockchain initiative. Within this framework, 44 concrete initiatives have been developed to unlock the benefits of blockchain technology. From January 2020, the country approved banks and financial institutions to offer custody services for cryptocurrencies: The license is issued by the country’s regulator, BaFin (theFederal Financial Supervision Authority), which of course implies high regulatory requirements and the application of standards similar to traditional financial markets.
In 2021, new legislation allowed “Special funds”, Institutional investment fund managers, to allocate up to 20% of their portfolios in cryptocurrencies: this initiative was considered a major step forward, which strongly legitimizes cryptocurrencies as investment instruments. That same year, the German government explicitly mentioned the blockchain and crypto sector in a program that underscored its commitment to creating a digital state: the government agreed to make Germany one of the most important places in Europe for fintech platforms. in the case of consumer-oriented financial applications (e.g. Robin Hood), which allows you to trade stocks and other investment opportunities. A notable section contains a provision authorizing the issuance of tokenized shares as the previous government ofAngela Merkel had already passed a law ending the requirement to have a securities certificate for the sale of a security, openly sought to promote the use of blockchain in the country.
One of the recent major changes in favor of the crypto industry is the adoption of a measure enabling holders of cryptocurrencies to be exempt from tax on the sale of cryptocurrencies, provided that one year has elapsed between the date of acquisition and the date of sale. Previously, cryptocurrencies that were resold or put on hold had to be stored for a period of 10 years before they could be exempted.
All these positive developments should not make us forget that the new government has stated in a document its intention to “constructively support the process of introducing a digital euro in addition to cash, available to all as a legal tender in Europe for general use. . ” This 24-page document covers many topics related to the crypto space, such as mining, staking and token airdrops.
The impact of these rules on the growth of the crypto sector is already raising some concerns. As is often the case in many countries, poorly enforced regulation can backfire on the crypto ecosystem, especially if regulators fail to consider proposals from industry actors. Given the ever-changing landscape of the sector, regulators feel and how they deal with new issues that arise will be crucial to the future of this industry.
Many certainly remember the German Chancellor’s harsh remarks Olaf Scholzwhen he was Minister of Finance, approx The weight : “(…) Germany and Europe can and will not accept its entry into the market until the regulatory risks have been adequately addressed.” He also added: “We must do everything in our power to ensure that the monopoly on the currency remains in the hands of the states.”
Nevertheless, the current crypto-friendly policies, comprehensive regulation and slow but still growing acceptance of blockchain technology and the crypto industry can make Germany one of the most important blockchain business hubs in Europe. Berlin, the German capital, is also one of the most important places where it is possible to use cryptocurrencies.
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