Portugal's largest bank, Banco de Investimentos Globais (BiG), has recently blocked fiat transfers to cryptocurrency platforms citing compliance with new European Union regulations.
Regulatory Shift in Portugal
BiG's decision aligns with growing regulatory pressure from European authorities like the European Central Bank and the Bank of Portugal, particularly in areas such as anti-money laundering and counter-terrorism financing. Portugal, once known for its crypto-friendly policies, introduced a new 28% capital gains tax on short-term crypto holdings in 2023. This change coincides with the European Union's implementation of the Markets in Crypto-Assets Regulation (MiCA), which aims to provide unified regulations for digital assets.
Crypto Community Reaction
Critics, including Portuguese entrepreneur José Maria Macedo, have expressed concern over users potentially shifting towards decentralized finance (DeFi). The introduction of tax laws has only fueled this sentiment, with fears that actions may drive crypto activity underground or into DeFi platforms. Although some countries like El Salvador reduced crypto adoption due to economic issues, Portugal's changing stance reflects broader global concerns about the risks associated with digital assets.
Diverse Approaches in Europe
Across Europe, the approach to cryptocurrencies varies. While countries like the Czech Republic and Switzerland embrace crypto in their financial systems, others like BiG in Portugal tighten restrictions. Despite these differences, the MiCA framework ensures only compliant crypto platforms can operate within the EU, offering some stability and trust in the shifting crypto landscape.
While the crypto community strongly reacts, the change could spur further decentralization in finance as users seek alternatives to traditional banking services.
