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Bitcoin in Europe: Live EUR Price, Best Exchanges, Taxes, and History
The European Union has been very liberal in allowing bitcoin trading. It has also been concurrently working with exchanges and wallets to identify suspicious activity. The debate around cryptocurrency in Europe has mostly been on which legislation should apply. The European Central Bank has declared cryptocurrencies as different from traditional financial assets, as such the traditional financial sector regulations should not apply. Additionally, the EU is working on a taskforce to combat money laundering and terrorism associated with trading.
The European Central Bank classifies bitcoin as a convertible decentralized virtual currency. However, a fully-fleshed regulatory regime is still tentative. Still, the environment is very open to Bitcoin holders and those interested in cryptocurrencies, generally.
Is Bitcoin Legal in Europe?
Bitcoin is legal in Europe. This includes both trading, selling and mining activities. The European Central Bank has also mentioned long-term plans to launch a public digital currency rivaling bitcoin. However, exchange regulations are maintained and monitored depending on individual member states. In February 2018, the ECB also mentioned the development of a Single Supervisory Mechanism to identify risks associated with cryptocurrencies in general.
How to Buy and Sell Bitcoin in Europe
In certain European Union member states, crypto-exchanges register with their respective regulators such as Germany’s Financial Supervisory Authority (BaFin), France’s Autorité des Marchés Financiers (AMF), or Italy’s Ministry of Finance.
In April 2018, the EU agreed on the text for the Fifth Money Laundering Directive (5MLD) which will bring cryptocurrency-fiat currency exchanges under EU’s anti-money laundering legislation. As a result, KYC/CDD is necessary on all customers who use exchanges or marketplaces to buy or sell Bitcoin.
Top Bitcoin exchanges in Europe
Unsurprisingly, Binance is one of the biggest exchange platforms in Europe. The exchange was launched in July 2017. After the ban from the Japanese government, the exchange moved to Malta. As of January 2019, Binance also announced that it is launching a new fiat-to-crypto exchange in Jersey, a self-governing dependency of the United Kingdom. Binance Jersey will let users buy or sell Bitcoin and Ethereum in British pounds (GBP) and euros (EUR).
Bitstamp is the second-best exchange in terms of real trading volume in Europe. The exchange began as a company that sold Bitcoin in 2011. It is headquartered in the UK, Luxembourg and Slovenia. However, since it offers only 14 open markets, it is not the most popular globally. Still,
it is a major mover on the BTC/EUR global market and is a suitable pick for traders due to often having significant volume.
Already popular in the global market, CoinDeal is one of the top exchanges in Europe. The company is known for offering a secure platform, a large selection of cryptocurrencies, and easy buying, along with a quick and responsive support team. It is also sometimes known as the ‘first cryptocurrency exchange to advertise in the English Premier League’ due to its partnership with the Wolverhampton Wanderers.
Outside of exchanges, LocalBitcoins is a popular option for those who prefer peer-to-peer trading in Europe. A more social form of exchanging cryptocurrency, LocalBitcoins allows you to find an interesting offer in “your area” and make a purchase directly from that selected person.
Additionally, there are over 1100 bitcoin ATMs in the European Union alone. Of course, the number of ATMs varies from member state to member state. For instance, the UK has over 250 locations while Lithuania has none. Overall, cryptocurrency and Bitcoin, in general, has been received very positively amongst citizens in the European Union. As of 2019, however, state governments are looking into whether Bitcoin ATMs still require stronger regulations against fraud or terrorism-related activities.
Europe’s Tax Rules on Bitcoin Profits
The European Union has states that Value Added Tax, Goods and Services Tax are not applicable to the conversion between traditional (fiat) currency and bitcoin. 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, banknotes and coins used as legal tender.” As such, Bitcoin is legal tender in the EU.
For the most part, tax rules on Bitcoin Profits depend on member state regulations. For instance, Germany does not tax long-term investments in cryptocurrency. Switzerland residents must pay income tax, profit tax, and wealth tax on their cryptocurrencies holdings. However, many member states charge capital gains tax on Bitcoin profits – at rates of 0-50%. In terms of mining, investment in cryptocurrencies is not subject to tax exemptions pursuant to Article 48 SteG (Tax Act). This means that speculative income is taxable and has to be declared, thus profits and losses are subject to taxation (12.5% income tax).
Where to Spend Bitcoin in Europe
Because the European Union recognizes cryptocurrency as legal tender, there are plenty of places to spend Bitcoin. The most common place where Bitcoin is used in Europe is sports betting. Bitcoin is spent on betting sites like Betcoin, NitrogenSports, and Sportsbet. Additionally, Europeans also use Bitcoin on getting cheap flights within the European Union. For instance, ABitSky, AirBaltic and CheapAir accept bitcoin as payment.
Several Bitcoin-accepting venues in Europe can be found on CoinMap. With many retailers accepting cryptocurrency and the abundance of Bitcoin ATMs, it is not shocking that payment systems are also trying to adapt to cryptocurrency in Europe. Payment services like Wirex and Paytomat have their own crypto debit cards as well, which makes transactions far simpler, conventional and easier. Exchanges have also gotten into the debit card business with Coinbase launching its Crypto Visa Debit Card for UK and EU Customers in early 2019.
Overall, even if a store doesn’t accept cryptocurrencies directly, there are workarounds that effectively mean you can spend Bitcoin at any store which accepts Visa or Mastercard. Additionally, there are many online vendors like Microsoft even which has been accepting Bitcoin for some time now.
If you are a Bitcoin holder in Europe, you will have virtually no issue spending your Bitcoin like you would cash if you are ready to take it that far.
History of Bitcoin in Europe
France was among the first few European countries to embrace Bitcoin, but things have changed over the past couple of years. Had the presidential candidate Le Penn won the election, she would have wanted to ban Bitcoin altogether.
Whether it be the adoption rate or Bitcoin regulations, overall it appears that Europe continues to lag behind so far as Bitcoin is concerned. Narrowing down to a possible reason why this is the case is not easy. It is likely the culmination of various reasons.