Crypto Regulation Mapped
Crypto Regulation Mapped

Crypto Regulation Mapped

Which countries have the tightest crypto regulations?

Interest in cryptocurrency has boomed over the last few years. Bitcoin, the first decentralised cryptocurrency, currently trades for $41,570, a staggering 1,123% increase in the last five years. Cryptocurrencies are so popular you can buy them through various cryptocurrency brokers 

The crypto world is estimated to be worth over $3 trillion, with over 300 million people worldwide owning some form of crypto. With more people investing than ever and so much money on the line, we’d all like to know where our crypto will be safest.  

Governments around the world are scrambling to put laws in place to protect investors. But which countries have the most regulations?   

The countries with the most crypto regulation 

Crypto assets are fully legal in ten G20 countries (the 20 countries with the largest economies in the world). These 10 countries represent 50% of the world’s GDP. All G20 countries are considering regulation. 

Crypto Regulation Mapped
Crypto Regulation Mapped

Countries with a 5/5 Crypto Regulation Score

These countries have all five things we look for in crypto regulation. Cryptocurrencies are legal to own, taxed as a currency or asset, require licenses for business ownership, and can be used to purchase goods. Each country’s central bank also currently has an ongoing currency project.

Seven OECD countries, including the United States and the United Kingdom, have complete legal crypto regulation. 

Rank Country Legal to own Taxed as an asset/currency License/registration required for crypto businesses Central Bank Currency Project Used to purchase goods Crypto Regulation Score /5 
1 Norway 1 1 1 1 1 5 
1 Australia 1 1 1 1 1 5 
1 Canada 1 1 1 1 1 5 
1 Chile 1 1 1 1 1 5 
1 Japan 1 1 1 1 1 5 
1 United Kingdom 1 1 1 1 1 5 
1 United States 1 1 1 1 1 5 

Countries with a 4.5/5 Crypto Regulation Score

Mexico earns a score of 4.5/5 for crypto regulations. While this covers legislation relating to purchasing goods with crypto, taxes, and business licenses and is working on a central bank project, Mexico still operates a partial ban on cryptocurrencies.  

Mexico is one country that is currently operating a regulatory sandbox. A crypto regulatory sandbox allows governments and the private sector to test whether cryptocurrencies can be effectively adopted and how to implement regulations. Canada, Italy, and Saudi Arabia have also developed their own regulatory sandboxes.  

Rank 

Country 

Legal to own 

Taxed as an asset/currency 

License/registration required for crypto businesses 

Central Bank Currency Project 

Used to purchase goods 

Crypto Regulation Score /5 

8 

Mexico 

0.5 

1 

1 

1 

1 

4.5 

Countries with a 4/5 Crypto Regulation Score

There are a further ten OECD countries with a regulatory ranking of 4/5. Mostly, these countries do not score a full 5/5 due to missing a currency project at their central bank.  

A cryptocurrency project at a central bank refers to a Central bank’s digital currency (CBDC). CBDCs are a form of digital currency issued by a country’s central bank and are similar to cryptocurrencies, except that the central bank fixes their value to mirror the country’s fiat currency.  

These currencies are a form of legal tender that can be exchanged for goods and services. However, they have no backing from a physical commodity like gold or silver. CBDCs will hopefully simplify monetary and fiscal policies concerning cryptocurrencies.  

Sweden does not tax cryptocurrency, while Denmark does not require registration for crypto businesses.  

Rank 

Country 

Legal to own 

Taxed as an asset/currency 

License/registration required for crypto businesses 

Central Bank Currency Project 

Used to purchase goods 

Crypto Regulation Score /5 

9 

Sweden 

1 

0 

1 

1 

1 

4 

9 

Denmark 

1 

1 

0 

1 

1 

4 

9 

France 

1 

1 

1 

0 

1 

4 

9 

Germany 

1 

1 

1 

0 

1 

4 

9 

Ireland 

1 

1 

1 

0 

1 

4 

9 

Israel 

1 

1 

1 

0 

1 

4 

9 

Italy 

1 

1 

1 

0 

1 

4 

9 

Netherlands 

1 

1 

1 

0 

1 

4 

9 

Poland 

1 

1 

1 

0 

1 

4 

9 

Spain 

1 

1 

1 

0 

1 

4 

Despite regulations in place around the world, there is a generally weak relationship between crypto adoption rates and regulatory restrictiveness. Six of the top ten countries in cryptocurrency adoption have partial or general bans in place. 

Crypto scams around the world

Crypto Regulation Mapped

The total value of cryptocurrency estimated to have been stolen via cryptocurrency scams is a shocking $26.9 billion. Factoring in appreciation of these assets from when they were stolen, the total value of stolen crypto reaches $80 billion. But where has the most money been stolen in crypto scams around the world?  

Most notably, crypto scams often occur online; thus, many scams do not have a defined country in which they occur. A total of $9 billion worth of crypto assets was stolen across 343 incidents with undefined countries of origin.  

1. 🇹🇷 Turkey – $2,000,000,000 across 1 incident

Turkey has seen the largest value of money stolen through crypto scams, which came from just one incident.  

In 2021, Turkey issued an international arrest warrant for Faruk Fatih Özer, the CEO and founder of the Thodex cryptocurrency exchange platform. Özer had stolen approximately $2 billion in funds from 391,000 investors after Thodex collapsed.  

Özer was fined approximately $5 million and sentenced to 11,196 years in prison after being found guilty of various charges, including fraud.  

2. 🇯🇵 Japan – $1,338,043,500 across 7 incidents

Japan has seen the second-highest volume of crypto value stolen at $1.3 billion across 7 incidents. 

The largest of these was the hacking of Bitcoin exchange platform Mt Gox. Mt Gox served investors all around the world but stored their information on a computer server in Japan. In 2011, hackers accessed Mt. Gox’s user data and transactions database, and the private keys for the exchange’s crypto. Between 2011 and 2014, hackers funnelled $615 million out of Mt. Gox wallets. 

The offenders have since been apprehended in the U.S. and face up to 25 years in prison.  

3. 🇨🇳 China – $1,010,720,700 across 6 incidents 

China comes in third place for the largest volume of stolen cryptocurrencies. China has seen £1 billion of crypto assets stolen via scams across 6 incidents.  
 
Most of this comes from a singular incident in 2020 when a multi-level marketing Ponzi scheme fraud occurred. The fraudulent trading platform, known as WoToken, only existed on marketing materials where all the fraudsters were doing was taking money from one investor to pay another. 

Four Chinese nationals were sentenced to up to nine years in prison in connection with their involvement in this mega cryptocurrency scam. The scam defrauded over 700,000 Chinese citizens. 

The countries with the most crypto scams

Rank 

Country 

Total stolen 

Number of incidents 

1 

Turkey 

$2,000,000,000 

1 

2 

Japan 

$1,338,043,500 

7 

3 

China 

$1,010,720,700 

6 

4 

USA 

$636,000,000 

2 

5 

United Kingdom 

$421,269,100 

11 

6 

Seychelles 

$346,065,600 

5 

7 

Hong Kong 

$232,002,000 

5 

8 

Russia 

$200,000,000 

1 

9 

Italy 

$195,303,000 

2 

10 

Cyprus 

$181,042,000 

2 

The biggest crypto scams of 2023

Crypto Regulation Mapped

Over $219 million was lost within the first six months of 2023 from over 100 rug pull cases. The frequency and sophistication of crypto scams are only increasing, so being aware of how these scams trick users into parting with their hard-earned cash can help you avoid falling into the same traps.  

1. JPEX – $192,000,000 

The largest crypto scam of 2023 was pulled in September, with almost $200 million stolen. JPEX was a Ponzi scheme that lured victims into investing by targeting mostly inexperienced investors with the promise of low risks and high returns. Several social media influencers also contributed to the scandal and have since been arrested earlier this month.  

So far, numerous people involved in the scheme have been apprehended, and millions of dollars have been seized. Assistant police commissioner Chung Wing-man said the investigation had reached people who were “relatively close” to the core of JPEX’s operations. However, the mastermind is still at large and much of the stolen money is still missing.  

2. Morgan DF Fintoch – $31,600,000

The second largest scam of 2023 took place in 2023. Over $31 million was stolen in an exit scam. DFintoch achieved this heist by advertising itself as a U.S. crypto investment platform backed by U.S. banking giant Morgan Stanley, offering returns on investments of up to 1% on a daily basis, adding up to 365% annually.  

Many serious crypto investors will know that this return on investment is magnitudes greater than any legitimate returns offered in the crypto industry. The scam went as far as to hire a paid actor as their CEO and made claims about connections to the UAE Royal Family. 

3. IPP Staking Pool – $14,500,000 

The third biggest scam of 2023 also took place in May. Over $14 million was stolen in a suspected rug pull. Also known as exit scams, a rug pull refers to a situation where cybercriminals create a fake trading platform (which, due to the largely unregulated nature of cryptocurrency, is surprisingly easy to do) and promote a project to attract investor money, only to disappear with the pool of investors’ assets. 

The biggest crypto scams of all time

Crypto Regulation Mapped

Below are the biggest crypto rug pulls and scams (based on the USD amount stolen at the time of the attack) to date: 

1. OneCoin – $4 billion stolen 

OneCoin was a Ponzi scheme. Starting in 2014, OneCoin lured investors by promising high returns with little or no risk. OneCoin is thought to have had more than 3 million members globally at its peak, raking in between $4 billion and $19 billion.  

To date, it is the most “successful” crypto scam and one of the biggest scams in history. The mastermind behind the scam, Ruja Ignatova, is still on the run. Dubbed the Cryptoqueen, Ignatova disappeared in 2017 after being tipped off about increasing police investigations into OneCoin. In July 2022, she was added to the FBI’s ‘Ten Most Wanted Fugitive List.’ 

2. Africrypt – $3.6 billion stolen 

In April 2021, the BTC pool of Africrypt, which was valued at $3.6 billion, disappeared. Brothers Raees and Ameer Cajee, who ran the platform, said the platform had been attacked, and all of the funds drained. Suspiciously, however, a week before the attack, Africrypt employees could not access the platform’s back-end.  

The brothers denied any involvement before disappearing a month later. It is said that they have now settled in the UK with their families and continue to deny any involvement, claiming the maximum sum they traded was $200 million and that the amount lost was really $5 million, not $3.6 billion. 

Africrypt was one of two huge crypto scams to take place in South Africa, prompting the country’s Financial Sector Conduct Authority to create a regulatory framework on how crypto trading should be conducted.  

3. GainBitcoin – $3 billion stolen  

In India’s biggest crypto scam, between 385,000 and 600,000 Bitcoin are estimated to have been stolen. The $3 billion figure is based on 385,000 Bitcoin, with the value of 600,000 Bitcoin reaching $4.7 billion at the time of the theft in March 2018. This would make it the largest scam of all time.  

The scheme reportedly offered investors monthly returns of 10% on bitcoin-on-bitcoin investments. Two company directors, Amit Bhardwaj and Ajay Bhardwaj, were arrested in 2018. Amit died in January 2022, but the case against Ajay remains ongoing, with estimates of the monetary amounts involved continuing to escalate. 

Methodology

Beginning with a list of OECD nations, each country was awarded a score out of five, given a point each if they met the following criteria according to Thompson Reuters, AtlanticCouncil, Coinmap, and Comply Advantage 

  • If they allowed cryptocurrencies to be owned.  
  • If they require a license to operate a crypto business.  
  • If their central bank is working on a cryptocurrency project. 
  • If cryptocurrency capital gains are taxed.  
  • If cryptocurrencies are widely accepted to purchase goods.    

 

Countries without complete data were removed from analysis. 

The total value of crypto scams worldwide and the biggest crypto scams were taken from comparitech 

Total number of incidents and value of thefts by country were taken from crystalblockchain 

The price of Bitcoin was taken from Google Finance and is correct as of December 4th, 14:27 UTC.