a progression of the crypto hub to watch closely

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Germany, one of the largest economies in Europe, is probably not considered a particularly pro-Bitcoin country. However, the country has taken a favorable stance towards investing in the blockchain and crypto sector for many years, introducing increasingly progressive legislation. Furthermore, Germany has the largest number of Bitcoin nodes in the world, second only to the United States, demonstrating a strong commitment to the blockchain and the cryptocurrency industry in general.

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Previously, like Portugal, Germany had implemented a national blockchain initiative. Within this framework, 44 concrete measures have been developed to unlock the benefits offered by blockchain technology. Since January 2020, the country has authorized banks and financial institutions to offer cryptocurrency custody services: the license is issued by the country’s regulator, the BaFin (theFederal Financial Supervisory Authority), which obviously implies high regulatory requirements and the application of standards similar to traditional financial markets.

In 2021, the new legislation allowed “Special funds”, Institutional investment fund managers, to allocate up to 20% of their portfolios in cryptocurrencies: this initiative was considered a huge step forward that strongly legitimizes cryptocurrencies as investment tools. In the same year, the German government explicitly referred to the blockchain and crypto sector in a program that underlined its commitment to creating a digital state: the government agreed to make Germany one of the main locations in Europe for fintech platforms, including with regard to consumer-oriented financial applications (eg. Robin Hood), which allow you to trade stocks and other investment options. One notable paragraph includes a provision to allow the issuance of tokenized shares such as the previous government ofAngela Merkel had already passed a law that ended the obligation to hold a paper certificate for the sale of a security, openly seeking to promote the use of the blockchain in the country.

One of the most recent big changes in favor of the cryptocurrency industry is the adoption of a measure that allows cryptocurrency holders to be exempt from tax when selling cryptocurrencies, provided that a year has passed between the acquisition date and the date. of balances. Previously, resold or staking cryptocurrencies had to be held for a period of 10 years before they could be exempted.

All these positive developments must not make us forget that the new government declared in a document its intention to “constructively support the process of introducing a digital euro in addition to cash, accessible to all as legal currency 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 regulations on the growth of the cryptocurrency sector is already giving rise to some concern. As is often the case in many countries, poorly enforced regulation could backfire on the crypto ecosystem, especially if regulators do not heed the suggestions of industry players. Given the ever-changing landscape of the industry, regulators feel at ease and how they address the new issues that emerge will be crucial for the future of this industry.

Many certainly remember the virulent remarks of the German Chancellor Olaf Scholzwhen he was finance minister, approx Libra : “(…) Germany and Europe cannot and will not accept its market entry until regulatory risks are adequately addressed.” He also added: “We must do everything to ensure that the monopoly of the currency remains in the hands of the states”.

However, current policies in favor of cryptocurrencies, extensive regulation and the slow but still growing acceptance of blockchain technology and the crypto industry can make Germany one of the most important blockchain trading centers in Europe. Berlin, the German capital, is also one of the main places where you can spend cryptocurrencies.

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