• 287 days Will The ECB Continue To Hike Rates?
  • 287 days Forbes: Aramco Remains Largest Company In The Middle East
  • 289 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 689 days Could Crypto Overtake Traditional Investment?
  • 694 days Americans Still Quitting Jobs At Record Pace
  • 696 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 699 days Is The Dollar Too Strong?
  • 699 days Big Tech Disappoints Investors on Earnings Calls
  • 700 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 702 days China Is Quietly Trying To Distance Itself From Russia
  • 702 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 706 days Crypto Investors Won Big In 2021
  • 706 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 707 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 709 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 710 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 713 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 714 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 714 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 716 days Are NFTs About To Take Over Gaming?
How The Ultra-Wealthy Are Using Art To Dodge Taxes

How The Ultra-Wealthy Are Using Art To Dodge Taxes

More freeports open around the…

Trade In Counterfeit Goods Hits Half A Trillion Dollars

Trade In Counterfeit Goods Hits Half A Trillion Dollars

The counterfeit market has breached…

Another Retail Giant Bites The Dust

Another Retail Giant Bites The Dust

Forever 21 filed for Chapter…

Crypto Insider

Crypto Insider

Cryptoinsider.com

Crypto Insider provides high-quality, long-form analytical pieces, investigative journalism, with less emphasis on breaking news. Our mission is to maintain high journalistic standards in the…

Contact Author

  1. Home
  2. Markets
  3. Other

Belarus just legalized bitcoin and granted miners tax exemption – here’s why

Belarus just legalized bitcoin and granted miners tax exemption – here’s why

As much of Europe prepared to party, Belarus began its festive season with a flurry of blockchain- and bitcoin-related activity, legalizing cryptocurrency-related activities with immediate effect. Bitcoin mania has made it to Minsk – and is showing no signs of slowing down as 2018 approaches.

Detractors may claim that the landlocked former Soviet state is somewhat late to the game – in spring this year, neighbor Ukraine struck a blockchain deal with Bitfury that the latter’s CEO called “probably the largest of its kind anywhere.”

However, Belarus’ sudden fervor to throw its lot in with blockchain and bitcoin is notable for its exceptionally wide scope. Long-serving president Aleksandr Lukashenko (who once called the internet “a pile of garbage”) has effectively kicked open the doors to a whole range of domestic and overseas blockchain and cryptocurrency operations.

Minsk’s moves

On December 22, he unveiled a range of surprising legal measures to a meeting of business representatives, saying, “Belarus will become the first state in the world to open up broad opportunities for the use of blockchain technology. We have every opportunity to become a regional center of competence in this field.”

As part of the package, the country has legalized the use of smart contracts, claiming that it is the first state in the world to do so. Indeed, any company working on smart contract development will now be exempt from paying income tax until 2023.

Cryptocurrency pioneers also have reason to sit up and take note – Lukashenko’s decree not only legalizes initial coin offerings (ICOs), but has also offered full, legal, tax-free status to all token issuance, digital currency trading and mining enterprises for the next five years.

Companies will also be allowed to work under what it terms “English law,” presumably meaning overseas crypto-related companies can sidestep Belarus’ often-suffocating, Soviet-era bureaucracy.

Park life

The Minsk government is no doubt hoping that its new High-Tech Park will rival Kazakhstan’s Astana International Financial Center, which has seen the likes of Deloitte and Waves team up with Kazakh and other CIS companies in an attempt to provide region-wide blockchain solutions.

In fact, it looks like almost anything goes at Belarus’ High-Tech Park. The head of the National Bank says the government will be “okay” with cryptocurrencies being used for international transactions at the park, and has even mooted the idea of launching a national digital currency.

Overseas IT experts now require no visa for stays of up to 180 days in Belarus, and VAT will not be payable for anyone transferring ownership rights, either to individuals or to overseas organizations.

Experts all around the CIS region have spent much of the festive season and the lead-up to the New Year trying to discover the rationale behind Minsk’s largely unexpected move. Russia’s Rambler quotesAlexander Chekan, venture partner of the Haxus Foundation, who claims that the both Belarus’ National Bank and its stock exchange are now conducting blockchain pilots.

Chekan also claims that Minsk’s laissez-faire attitude to the High-Tech Park will lead to “more corporations setting up R&D operations in the country, and an influx of start-ups and funding from other countries where blockchain regulations are stricter.”

Earlier this year, Chekan told reporters that Belarus’ banking and tax systems also needed “the ability to work with the most modern payment tools, ranging from PayPal to bitcoin.”

“Europe’s last dictator”

So where did Belarus’ sudden fervor for all things crypto and blockchain-related come from?

Belarus’ regime is notably guarded about most of its policy decision, and Lukashenko, known as “Europe’s last dictator” (and the longest-serving head of state on the continent) is known to keep his cards very close to his chest.

However, one of Belarus’ leading cryptocurrency advocate, businessman Viktor Prokopenya, has been meeting with Lukashenko since early this year and appears to have won the president’s confidence on cryptocurrency matters. The latter’s head was apparently turned after a visit to Prokopenya’s offices back in March.

Prokopenya even addressed the Minsk parliament last week, saying, “Belarus wants to be an IT capital for the Slavic world like Hong Kong. In times of sanctions and political instability at our borders, this is more urgent than ever.”

Indeed, Prokopenya’s mention of borders is telling – in addition to Ukraine’s blockchain operations, Russian counterpart Vladimir Putin has developed a keen interest in cryptocurrenies in 2017. The Kremlin chief has met with Ethereum founder Vitalik Buterin, while plans are afoot to create a “Bitcoin City” near the Chinese border.

Other former CIS states have pressed ahead with blockchain technology projects and crypto ventures that look like they are already bearing fruit, particularly the Baltic States to the west and Kazakhstan and Georgia to the south. Belarus has been the odd-one-out – a status it is looking to rectify with remarkable alacrity.

What’s in store for 2018?

Cryptocurrency is now enjoying a spectacular rise in popularity in the country. BNTU, Belarus’ biggest technical university, has begun offering degree courses in Cryptocurrencies and Derivatives, with scores of people rushing to submit their applications.

Leading Belarusian bankers are expressing a keen interest in the central bank’s tentative plans for a national digital currency. Belgazprombank’s deputy chairman states, optimistically, “If [the Belarusian government] feels that a national digital currency would genuinely be of benefit, the potential is there to release it relatively quickly.”

Belarus did not even feature on Forbes’ 2017 list of the Best Countries for Business – although there were places for neighbors and rivals such as Russia (58), Moldova (87) and Ukraine (80). Russian news site Sputnik claims, “Most likely, Forbes did not even consider evaluating Belarus when it was drawing up its list.” Hopes are high that all this will change if overseas companies take note of Belarus’ cryptocurrency and blockchain technology policy announcement.

Indeed, as Russia and Ukraine, Belarus’ closest frenemies, appear to dither over their crypto policy, Minsk will hope it has stolen a march on Moscow and Kiev in one key area – legislation. It is a surprising move, and one that may yet reshape the entire CIS region’s financial landscape.

By Tim Alper via Crypto Insider

Back to homepage

Leave a comment

Leave a comment