Crypto Regulations in Andorra
On 30 June, the General Council of Andorra approved the regulatory framework of Blockchain and digital currencies through the “Draft law on the digital representation of assets through the use of cryptography and distributed ledger and blockchain technology” (hereinafter, the “Digital Assets Act”
Source: Fintax Andorra
Andorra is already working on a law regulating the legal framework of blockchain technology that will open the doors to the regulation of cryptocurrencies. There is still nothing in force that legislates this type of activity, thus the Principality could be among the first countries to have its own legislation.
Source: Andorra Partner
The country’s government, the General Council of Andorra, recently approved the Digital Assets Act, a regulatory framework for digital currencies and blockchain technology. The act is split into two parts. The first regards the creation of digital money, or “programmable digital sovereign money,” which can be exchanged in a closed system. In effect, this would allow the Andorran state to create its own token.
Source: Cointelegraph
Crypto assets and other digital currencies aren’t recognized as legal tender in Andorra and the Digital Assets Act proposes no new provisions for exchange methods via these assets. This privilege has only been granted to Euro, European Central Bank’s preferred currency.
Source: Forbes India
Andorra already has a favorable tax plan for cryptocurrency investors, as there is no wealth tax. At the level of personal income tax, capital gains are capped at 10%, but the Andorran government has already received comments regarding the possibility of revising the law with an exemption of crypto money. As a country in the transformation towards an economy that is committed to technological innovation, where legislation is in favor of the development of e-Sports and digital assets, we can say that the answer to the question is yes: in Andorra, cryptocurrencies can be taxed at 0%. Undoubtedly, we will follow new legislation closely.
Source: Andorra Partner
The application of VAT (general indirect tax/ l’impost general indirecte or IGI), to bitcoin mining operations, is covered by the Bill. This means that mining activity will not be subject to VAT as long as it is not performed in an onerous manner and there is no legal link between the person providing the service and the receiver.
Source: Global Vat Compliance
Andorra’s Official Gazette published Law 24/2022. Digital Assets Act – the legislation that governs the use of Blockchain Technology and Digital Assets was approved by the General Council of the Principality of Andorra. It is scheduled to go into effect on the 20th of October 2022.
Source: Global Vat Compliance
Blockchain projects in Andorra and mining are already a reality. Several companies engaged in mining different cryptocurrencies already decided to obtain a tax residency in Andorra. The principality is known for its focus on online transformation. Andorra’s digital nomad residency program soon will be another advantage for citizens to enjoy. Andorra is committed to technology as a way to make life easier for its inhabitants. The new visa program is no exception, as it is a way to innovate and adapt to the modern way of working.
Source: Andorra Partner
With blockchain activities and projects, Andorra is a country seeking to provide similar support in this vertical as Malta. Principality tries to attract entrepreneurs or already consolidated companies to develop cutting-edge technology on-site. A non-profit association called AndBlockchain is constantly pushing for crypto legislation, to obtain all possible benefits for people investing in crypto money in Andorra.
Source: Andorra Partner
The police detain a YouTuber in Andorra for an alleged pyramid scam with courses on cryptocurrencies. The Mossos published on their Twitter that the six people arrested are “allegedly involved in a cryptocurrency scam amounting to 70,000 euros. High-end vehicles and electronic devices are located in the records. ”Among the cryptocurrencies intercepted by the authorities were Bitcoin, Ethereum, Ripple, and OmiseGo.
Source: Sama Game
Despite the embryonic state of the crypto-assets regulatory regime in Andorra and the fact that there have so far been no changes in the legislation, crypto-assets and the use of DLT may be a relevant turning point for the Andorran financial sector, especially if applied to its core banking business. For the time being, cryptocurrency exchanges are not regulated in Andorra.
Source: Practice Guides
