The monetary system of our world has constantly been subjected to change. Starting from the ancient barter system to cashless payment systems, the financial system has undergone advanced modifications. Currently, there is a very new alternative system of blockchain technology which has now reached its peak with many countries introducing it into their payment systems, investing in them, and putting it to a practical test by embracing this technology for the secure functioning of their businesses.
Countries Which Have Embraced Blockchain Technology
Countries across the globe are jealous of Australia’s tax laws regarding Bitcoin and cryptocurrencies, in general. Taxes have been removed for all transactions and trades done using cryptocurrencies. This is advantageous for day traders as they need not pay taxes for each trade and for Australian citizens as they need not pay taxes for any of their purchases. The Australian Securities Exchange (ASX) announced that blockchain technology would be adopted fully after two years following the two-year testing period.
The Chinese government is currently contesting the United States as the largest world power. China houses thousands of blockchain-based startups. Chinese banking consortiums have also started to rally around blockchain. The Government of China is open to adopting blockchain and Artificial Intelligence (AI). It actively supports its top cryptocurrency and smart contract platforms such as Qtum, TRON, NEO, VeChain, and many others.
Japan has always been several months ahead when it comes to Bitcoin and crypto adoption. Some of the retail stores in Japan accept Bitcoin. It is among the largest Bitcoin traders. According to a Nikkei report cited in a note by Masao Muraki, who is a global financial strategist at Deutsche Bank, around 40% of Bitcoin trading in Q4 in the year 2017 was conducted in Yen. Japan is a Bitcoin-native country.
United Arab Emirates (Dubai)
Dubai is known as one of the richest and most technological countries in the world. They have been researching blockchain technology and its transactional efficiency for years now. They are planning to implement it in their cities so that they can have a more seamless economy. A deadline of 2020 has been set by the government to collate all government-related data and documentation and to add it onto the blockchain.
This Europen country has positioned itself as a global leader owing to its progressive approach to cryptocurrencies. Cryptocurrencies are accepted as a medium of exchange. The Virtual Financial Assets Act (VFA), which was effective from November 2018, introduced the Innovative Technology Arrangements and Services Act which acts as the regime for future registration and accountability of crypto service providers. It will act as a regulatory framework for cryptocurrencies.
Zug, in Switzerland, is home to some of the world’s top blockchain companies. Zug is known as CryptoValley as it offers a powerful platform for global growth in the cryptocurrency space in terms of infrastructure, world-class talent, and accessibility of its local crypto-friendly government. Zug is home to the Crypto Valley Association (CVA), a non-profit which aims to build the world’s leading blockchain ecosystem. In 2016, it became the first city in the world to accept Bitcoin payments for tax purposes. In 2017, it announced the launching of its decentralized Ethereum-based digital ID system. In 2018, it successfully completed the first testing of the local blockchain-based voting system. The recent development was the creation of Blockchain TaskForce, for providing a clear-cut framework for companies.
In 2013, the Financial Crimes Enforcement Network (FinCEN) bureau understood the necessity to regulate transactions relating to the exchange of cryptocurrencies. In the first quarter of 2014, the USA Internal Revenue Service released a guide about taxation of operations with regard to Bitcoins and other virtual currencies. Bitcoins are treated as property when it comes to federal taxes. Profits from Bitcoin mining are subject to taxation. ICOs are also under regulation in the US. The Security and Exchange Commission (SEC) controls tokens which thereby reduces the threat that ICOs will not be able to fulfill their tokens within the specified time limit.
The government has digitized its services using blockchain technology. The potential of blockchain is rapidly increasing and hence, a lot of startups have started their innovative blockchain projects. In 2013, it turned to blockchain when it wanted to secure the health records of its 1.3 million residents. It is now digitized. There are many aspects of Estonia’s business environment which were favored by many crypto entrepreneurs and these include 0% tax on undistributed profits and 100% online cross-border management. e-Residency, backed by the Estonian government, ensures the legitimacy of ICOs and cryptocurrencies.
The UK Government has been embracing blockchain technology in many ways. It houses the second-highest number of blockchain startups. Blockchain technology in the UK has the potential to improve issues of identity theft and slow financial services. The Foods Standards Agency has implemented blockchain as a regulatory tool for regulating meat data in slaughterhouses. The government’s National Archives is collaborating with the University of Surrey on a project named ARCHANGEL. This allows hashes of documents to be registered on archives through a permission blockchain, thereby eliminating the ability to tamper information. The government is looking to implement blockchain in voting and healthcare systems.
It is home to the third-largest ICO market. The Monetary Authority of Singapore (MAS) encourages the adoption of blockchain technology in technological and financial sectors. It supports cross-border payments using digital ledger technology. Insurance companies use smart contracts. It is also working towards building a secure healthcare data system. Singapore aims to achieve interconnectivity by using blockchain technology.
The above-mentioned countries and many more are caught in a tight race to become the undisputed capital of blockchain innovation. They aim to lead technology for decades by creating an innovative economy with the help of the most intelligent blockchain geeks and tech-savvy minds on Earth. In this technological revolution, there will certainly be a few key winners in this blockchain race over the next decade, across the entire planet.