Bitcoin Businesses Leaving U. S. in Droves

Numerous Bitcoin businesses have left or are in the process of leaving the United States. As a reason for their decision, these businesses quote the overall climate for innovative and startup businesses in the U. S. which has become too unfavourable.

Back in March, a Federal judge declared Bitcoin exchangers and administrators money services businesses and therefore liable to register as such. This involves burdensome procedures along with financial requirements of posting millions of dollars in insurance bonds to legally operate under applicable rules in the U. S. It has often been pointed out in recent years that even opening up the proverbial lemonade stand in the U. S. is no longer economically viable. The ever increasing load of regulations and administrative hurdles makes it impossible for many kinds of businesses including Bitcoin-related ones to meaningfully operate or continue their operations in the U. S.

Preferred destination for moving and re-opening Bitcoin operations abroad range from Panama with its comparatively low overall level of government red-tape to Canada (currently having a more or less hands-off policy toward Bitcoin) and several European countries. Among the most welcoming jurisdictions for Bitcoin operations are Sweden,  Germany, the U. K. and, to a lesser extent, also France.

With real estate prices currently clearly a buyers” market and and a resulting abundance of suitable low-cost business premises, some of these are particularly attractive. Business rates, incorporation requirements and taxes have been widely reformed, trimmed downward recently and are now well within reach for even the smallest operations. On top, all of these countries (including non-EU Norway open to favourable EEC common market rules by way of special EEA status plus bi-lateral treaties) allow Bitcoin operations licensed in any one of these countries (with particularly attractive regulations) to also legally operate throughout all other EEA ( that is, EU plus EFTA) countries automatically.

With other portions of the regulatory array (e g applicability of sales taxes) differing widely even among those otherwise favourable jurisdictions, an in-depth analysis is required in all these areas before making appropriate business decisions.

We will cover the ins and outs of particularly suitable Bitcoin jurisdictions in more detail in a separate series of upcoming Bitcin Country Reports.

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