Unlike traditional currencies issued by governments, cryptocurrencies operate on decentralized networks based on Blockchain technology – a distributed registry of cryptocurrency registration and ownership enforced by a network of computers.
In addition, the Treasury Department and the established committee are being asked to study stablecoins, which are an extremely difficult case for lawmakers.
On the one hand, any removal of barriers to their use opens the way to bypassing banks as payment mechanisms.
On the other hand, they have become major buyers of US Treasuries, supporting the dollar at a time of geopolitical developments.
It establishes uniform rules for cryptocurrency issuers that have so far not been regulated by other European Union (EU) financial services acts and for service providers related to such cryptocurrencies (cryptocurrency service providers). The rules cover:
- the transparency and disclosure requirements for the issuance, public offering and admission to trading on a cryptocurrency trading platform of cryptocurrencies
- the licensing and supervision of crypto service providers and asset-based token issuers and issuers of electronic money tokens;
- the operation, organisation and governance of publishers and crypto service providers;
- the protection of crypto owners and crypto service customers;
- measures to prevent the misuse of privileged information, unlawful disclosure of privileged information and market manipulation.
The committee will focus on 3 main categories of cryptocurrencies:
- MONEY TOKENS
E-money tokens (cryptocurrencies that stabilise their value against an official currency)
- ASSET-REFERENCED TOKENS
Asset-referenced tokens (crypto-assets that stabilise their value relative to other assets or a group of assets)
- OTHER CRYPTOCURRENCIES
Cryptocurrencies other than tokens with reference to assets and e-money tokens.
The main objective is to establish the regulatory framework from an exchange perspective and correspondingly from a tax perspective.
After all, the digital euro cannot be created unless cryptocurrencies are first of all framed, as this would then create major shocks for transactions.
Greece’s tax policy is moving towards the integration of cryptocurrencies into the official tax system, addressing the need for a more comprehensive regulation of digital transactions and investments.
After years of uncertainty, cryptocurrencies such as Bitcoin are recognized as investment products, subjecting the gains from them to capital gains tax, in case they are considered an investment good.
In the case of the transactional market, cryptocurrencies are considered monetary assets and must be treated differently.
These changes reflect the broader trend of the Greek government to tighten control over digital economic activities, trying to reduce tax evasion and increase public revenues.
An important step in this direction is the establishment of a special committee that will meet regularly to regulate and control the taxation of cryptocurrencies.
On the other hand, taxpayers face new challenges.
Applying taxation to cryptocurrencies is not a simple task due to the highly volatile and often opaque nature of transactions.
A great deal of uncertainty remains about how the value of cryptocurrencies will be assessed at the time of the transaction, and taxpayers are concerned about the possibility of being overtaxed or charged taxes from previous years, up to and including 2024.
As the government and taxpayers try to adapt to the new tax realities that cryptocurrencies bring, the focus should be on education and transparency.
For the government, this means creating understandable and accessible instructions for taxpayers on how to declare their cryptocurrency transactions, as well as strengthening control mechanisms to prevent tax evasion.
From the taxpayers’ perspective, it is crucial that they are informed and fully understand their legal obligations, work with tax advisors or cryptocurrency experts and follow the legislation to avoid potential fines.
With the rapid evolution of the digital economy, continuous education and adaptation will be key to the success of both tax authorities and citizens in this new economic landscape.
While formal changes are scheduled to be implemented by 2025, discussions are ongoing and final decisions may even affect current transactions.
The climate is intense and the cryptocurrency community is closely monitoring developments, trying to adapt to an evolving tax landscape.
