In a significant development for cryptocurrency sector, Baltic States are witnessing increased use of bitcoin as means of payment. One of the main reasons for such growth is the lack of comprehensive regulations in these States. This could be interpreted as the States are yet to see the other side of the digital currency used as the policymakers around the world is tightening their regulations on the sector. The main concerns raised by regulators are the money laundering activities with the help of the virtual currencies.
Multiple Sectors Accepting
However, businesses in the Baltic States are not looking at what other countries are doing and promoting the bitcoin payment. As a result, multiple sectors are taking advantage of digital currency means. This included online trade, real estate, hospitality industry and even the healthcare. Aside from these, some of the enterprises have also been providing their services at international levels. Lithuania, Latvia, and Estonia are accepting the virtual currency as means of payment in places like an orthopedic clinic, souvenir shops, hotels, restaurants, bars, and cafes.
As a result, the three States have now become to be called as the ‘Bitcoin Tigers’ of Europe from ‘Baltic Tigers of Europe.’ A number of firms that are selling housing units and land plots in the Baltics have started accepting bitcoin in the real estate sector. This would allow possible buyers to acquire homes and land in the Auriai cottage segment that is under construction currently. This is not far from Lithuania’s capital, Vilnius.
In the Vilnius region alone, there were over 30 locations that accept crypto payments. Similarly, there are 26 locations in Tallinn while it was 21 in Riga. Based on a report of coinatmradar, bitcoin ATMs was found in Estonia and Lithuania capitals. The businesses that accept the digital coin in these regions were hotels, cafes, bars, souvenir shops, and restaurants. This has the potential to drive other sectors too to catch up with the rest.
Other virtual currencies such as Ethereum, dash, NEM have also been accepted by fashion brand stores in Vilnius following the announcement of the United Colors of Benetton franchisee in Lithuania. This comes from an alliance with Coppay, which is a Belarus-based payments provider that offered instant conversion based on multiple markets data. A co-owner of a firm indicated that his employees liked it as a simple and easy process and that there was no need for additional training.
Lack of Regulations
One of the main reasons for the increase in the use of cryptocurrencies in the Baltic States is that these places have not come up with any comprehensive regulations. Most recently, Latvia tried to recognize digital currencies for taxation purposes partially while authorities in Riga disclosed that Bitcoin could perform as an exchange means. Therefore, it could attract 20 percent tax imposed on capital gains that applicable to virtual currency deals.
Significantly, Estonia is thinking of having a national coin like ‘estcoin’ through the European Central Bank is not favoring such a move. Similarly, Tallinn is not ready to leave the idea. Though the banking regulator in Lithuania was not in favor of cryptocurrencies initially, it has commenced consultations with crypto sector representatives for a possible framework of regulations.