Introduction to the cryptocurrency law from the perspective of a blockchain attorney.
Whether you are a beginner who is interested in investing and trading, a seasoned blockchain professional, or an aspiring Web3 project, the legal landscape surrounding crypto law can be confusing. From country-specific blockchain regulations to laws in the markets you might want to expand to, this can be quite a challenge to navigate alone.
This is where cryptocurrency lawyers can help and guide you or your project through any legal challenge. But before you decide to reach out to lawyers specializing in cryptocurrency, you might want to know more about the matter at hand.
VILP Solutions is an EU-based blockchain law firm that supports businesses in regulatory and commercial matters, including blockchain and crypto regulation in the EU. In this article, Paulius Vaitkevičius, VILP Solutions Founder and a crypto attorney with 7+ years of experience in the field, will answer the most pressing question: from crypto law 101 to region-specific legal matters.
The short answer is yes, but the details largely depend on the region and context that is specific to your question. Bitcoin was first recognized as virtual currency by the US in 2013, only becoming a legal and taxable commodity in 2015. The rest of the world followed, and the landscape of crypto law has only evolved since then.
While most countries worldwide don’t limit the use of Bitcoin and other virtual currencies, it is their status that plays the biggest role. Currently, there are two approaches to cryptocurrency law: crypto can be considered either as a commodity, making it taxable, or as means of payment, similar to other fiat currencies like the dollar. It is this difference that makes blockchain businesses so hard to navigate legally.
As already mentioned, cryptocurrency regulations around the world differ from country to country. In 2022, there is no universal legislation covering crypto worldwide.
Some countries impose limitations on how virtual currencies can be used, banning cryptocurrency transactions and placing strict tax implications, while others outright ban the use of crypto, with heavy fines and penalties. Currently, there are only nine nations that oppose the use of virtual currency: Algeria, Bangladesh, China, Egypt, Iraq, Morocco, Nepal, Qatar, and Tunisia.
On the bright side, however, many regions across the globe are hot spots for rapidly developing cryptocurrency law. For example, in October, the European Union has taken a big step towards regulating crypto and approved the Markets in Crypto-Assets (MiCA) bill, which classifies crypto assets and brings them under the supervision of the European Securities and Markets Authority (ESMA) and the European Banking Authority (EBA).
North America, Southeast Asia, the Middle East and North Africa, and other regions that lead the cryptocurrency adoption rates globally, are expected to follow. Even as cryptocurrency law secures everyone involved from money laundering and ensures consumer protection, crypto company accountability, and the industry’s environmental impact, it becomes increasingly difficult to navigate without additional assistance from blockchain legal services.
There is no universal answer, as the crypto legal field is as broad as any other industry. A crypto lawyer is a professional and licensed attorney with background and profound understanding of cryptocurrency law, as well as a specific specialization. As you wouldn’t expect a civil rights lawyer to be able to pick up any case, crypto lawyers have different levels of expertise on different areas of cryptocurrency law, such as:
A crypto lawyer might be more experienced in one area over another, and it shouldn’t be viewed as a disadvantage – that simply means they have a narrow specialization, which is something you should be looking for if you want a high level of blockchain legal services that are tailored to your needs.
Not every experienced lawyer will be a good fit for your or your crypto project. If you are looking for a “jack of all trades” when it comes to cryptocurrency legal consulting, you will eventually run into a problem of lack of expertise.
You can approach the search for a crypto attorney from two general perspectives: region and specialization. If you are starting or expanding a project in a country where cryptocurrency law is challenging to navigate (and, to be fair, it is in most cases), look for local legal experts that specialize in your region, be it in the EU, Asia, or somewhere else. They will have a comprehensive understanding of what you need to do in terms of licensing, authorization, obtaining bank accounts, and more.
On the other hand, you can match with legal representatives by their specialization and expertise. It is especially helpful if your project is not bound by one country and goes international. Blockchain law firms should have use cases that are similar to your crypto project or specific crypto law problems you have run into. With a proven record of experience and successful ventures, you will be sure your project is in safe hands.
If you are looking for on-demand legal services for crypto projects, tokens, exchanges, and blockchain-based business models, VILP Solutions is a crypto law firm that specializes in assisting Web3 businesses with the legal framework.
We are an EU-based legal consulting company providing 360° support in the fields of financial services, e-commerce, contracts, and data protection. We cover a wide scope of regulatory and commercial matters, including blockchain and crypto regulation in the EU. Contact us here.