Crypto in Finland is going mainstream with fresh set of regulations and government agencies constantly updating the guidelines.
It is not hard to see why government want to regulate crypto currencies even though main aim is to protect citizens, but also by bringing in to mainstream it can monitor and control what’s going on in the industry. Crypto currency sales are reported to have resulted in millions of tax revenues to the Finnish tax authority.
Finnish President Sauli Niinisto authorized legislation this may covering providers of services linked to cryptocurrency, including exchanges, trading platforms, crypto wallets and digital coin issuers.
According to FIN-FSA the Act on virtual currency providers (572/2019) enters into force on 1 May 2019. In accordance with the Act, the Financial Supervisory Authority (FIN-FSA) will act as the registration authority and supervisory authority for virtual currency providers.
Fin-FSA explained that new requirements are based on amendments to the EU Directive on Anti Money Laundering Procedures. Registration will ensure that providers comply with their statutory requirements concerning:
- reliability of the provider (incl. fit and proper requirements)
- holding and protecting client money
- segregation of client money and own funds
- marketing of services
- compliance with AML/CFT regulation
FIN-FSA noted in its statement that in the future, only virtual currency providers that meet statutory requirements will be able to continue their activities in Finland. Virtual currency providers who do not meet statutory requirements are prohibited from continuing their business activities, enforced by a conditional fine.
The Tax Authority published extra suggestions saying that when the crypto currency is realized (when it becomes money), the exchange rate is determined and cryptocurrency records should be maintained for six years.
In case of confiscation of cryptocurrencies arise due to illegal activities like money laundering, drug offenses etc. Finnish authorities can auction crypto currencies, in this regard Finnish govt has issued instructions on how seized cryptocurrencies can be stored.
By holding companies accountable, FIN-FSA may be interested in offering an additional protective layer, further it is also the responsibility of each individual to conduct their own research and be cautious before leaving their cash and investing in cryptocurrency.
It is also encouraging from a tax point of view, the tax administration published a detailed guidance regarding crypto currencies. The recent guidance on crypto taxation provides much wanted clarity to many of the questions concerning crypto taxation in Finland. These fresh guidelines continue to suggest that cryptocurrency are mostly treated as an asset than regular currency. Here there is further information on the difference between traditional currencies and so called cryptocurrencies.
For detail tax issues on crypto in Finland go through the link below vero.fi
Image: Anastasia Borisova