As cryptocurrencies continue to become a bigger part of the global economy, more and more governments are exploring ways to regulate the industry and construct rules for firms operating in the space.

There have been some significant regulatory developments in recent weeks, with the European Parliament approving the Markets in Crypto-Assets (MiCA) regulations on April 20, Ukraine announcing it would adopt the same set of rules, and South Korea making progress with its proposed regulations.

While US regulators have been busy infighting and refusing to provide the most basic of clarity for the crypto industry, the European Union just approved the MiCA regulation, which provides a comprehensive regulatory framework for crypto in Europe. It’s sad to see the US being…

— Tyler Winklevoss (@tyler) April 20, 2023

The collapse of crypto exchange FTX has led to calls for fast-tracked regulations in numerous countries, with its bankruptcy resulting in a contagion that contributed to the downfall of many firms it associated with.

Speaking to Cointelegraph, chairman and co-founder of Animoca Brands Yat Siu noted that his firm is “very pro-regulation, as that provides a framework that legitimizes the industry.” Sui said that a lack of regulatory clarity could have the opposite effect and create uncertainty, adding:

“Broadly speaking, regulation has seen a much more positive direction in places like Hong Kong, Japan, UAE, and even parts of Europe compared to the U.S., which has attracted capital, talent and jobs in those places.”

Below is a breakdown of crypto regulations in different countries worldwide and whether they provide clear rules for a cryptocurrency industry to be built around, if they are hostile toward crypto firms, or if they lack clear regulations.

This is not a definitive list but aims to cover many of the largest countries by gross domestic product and those with unique rules. Most European Union member states are not included, with many likely to adopt the incoming MiCA regulations.

Regulations can be highly nuanced, so attempts to categorize different countries’ regulations may be an oversimplification.

Countries or regions with clear regulations

Bahamas: The Bahamas has become desirable for crypto firms’ headquarters due to its friendly tax policies and transparent regulatory framework. FTX was headquartered there, and Coinbase is reportedly set to create a derivatives exchange there.

Brazil: Former Brazilian President Jair Bolsonaro signed a crypto bill into law on Dec. 22, 2022, which legalized using crypto as a payment method and established a licensing regime for virtual asset service providers.

Canada: The first country to approve a Bitcoin (BTC) exchange-traded fund; Canada requires all crypto trading platforms to register with regulators and, for the most part, has clear regulations that individuals and businesses must follow.

Cayman Islands: Similar to the Bahamas, the Cayman Islands has a clear regulatory framework and friendly tax policies, making it a preferred location for many crypto firms.

El Salvador: The first country to recognize Bitcoin (BTC) as legal tender; it has fully embraced crypto and plans to create a “Bitcoin City,” which will provide residents with tax benefits. The country has even paved the way for Bitcoin-backed bonds.

Japan: Japan’s clear regulatory framework places strict standards on crypto exchanges, including a requirement to segregate exchange and customer assets, which meant that customers of FTX Japan could fully withdraw all their funds following the collapse of its parent company.

Mexico: Mexico’s central bank has broad powers enabling it to regulate virtual assets following laws passed in 2018 outlining the requirements for firms operating in the crypto industry.

Switzerland: While Switzerland has strict laws regarding Anti-Money Laundering (AML) and Know Your Customer requirements, its regulatory framework is clear and provides its crypto industry with clear guidelines on how it must operate.

Countries that are hostile toward crypto

Afghanistan: After the Taliban came to power, it banned cryptocurrency trading in August 2022.

Algeria: The purchase, use, sale and holding of crypto has been prohibited in Algeria since 2017.

Bangladesh: Although Bangladesh has indicated a desire to become a “Blockchain-enabled Nation,” transacting with crypto is illegal.

Bolivia: The Central Bank of Bolivia issued a resolution to ban the use of crypto in 2014.

China: China banned local crypto exchanges in 2017, progressing to a blanket ban on mining and cryptocurrency use in 2021.

Egypt: Crypto transactions in Egypt have been prohibited since 2018, but the nation appears to be warming to crypto following reports earlier this year that it was looking at creating its own regulatory framework for crypto.

Morocco: Transacting with crypto has been illegal in Morocco since 2017.

Nepal: Nepal has outright banned any use of crypto in the country and, earlier this year, told internet service providers and email service providers to prevent access to “websites, apps, or online networks” related to crypto.

Countries that lack a clear regulatory framework

Australia: Australia’s lack of clear regulations has left consumers heavily exposed to industry-wide events such as the collapse of FTX, but it is currently making progress on establishing broad regulations as it engages in a public consultation on how to classify crypto and firms operating in the space.

Hong Kong: Hong Kong has been quickly progressing in its efforts to regulate crypto and become a crypto hub but still lacks clear regulations. It is set to release crypto exchange licensing guidelines next month, with its courts also recently recognizing crypto assets as property.

India: While India has imposed AML rules on crypto, it lacks clear regulations for the crypto industry and recorded huge drops in crypto exchange activity after putting in place hefty taxation laws in 2022. The Reserve Bank of India banned cryptocurrency in 2018, but the supreme court lifted the ban in 2020.

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Russia: While there are reports that Russia may adopt crypto regulations as early as June, it currently does not have a clear regulatory framework and has previously banned using cryptocurrencies for commerce.

South Korea: South Korea has some crypto regulations and is close to passing its own sweeping crypto bill, which would require crypto exchanges and service providers to segregate customer and business funds, among other measures.

United Kingdom: While the U.K.’s financial regulator — the Financial Conduct Authority — has recently called upon the crypto industry to work with it as it develops its own regulatory framework, it currently has limited powers to regulate the sector and has said that firms will have four months to implement changes required by the rules when they come into force.

United States: Although the U.S. still has the most crypto-related development and a high proportion of crypto users, it lacks a clear regulatory framework that some argue drives firms offshore.