Cryptocurrency in the United States is regarded as decentralized and they operate the same way as a fiat currency. This means that exchanges and other organizations undergoing operations with them are obliged:
- to be registered as Money Services Businesses (financial services);
- to receive licenses for such activity (bitlicense, USA);
- to inform law enforcement authorities of transactions arousing suspicions.
Cryptocurrency taxation, which is equal to property taxes, is also regulated at the national level. Profits from operations involving it are viewed as capital gains profits and are taxed under the Internal Revenue Service of the USA. Violation of crypto-currency exchange and token placement regulation are deemed by the SEC as criminal acts (in 2017 it already initiated the first case over an ICO swindle).
General compliance issues
Issuance of cryptocurrency exchange license in the USA, as well as the further use requires compliance with a number requirements:
- implementation of a comprehensive risk analisis associated with the operation of the company that registered the license;
- implementation of written policies, procedures and control measures to comply with the requirements of compliance standards;
- appointment of an authorized person in the field of compliance;
- information and training of staff;
- constant monitoring of operations;
- reports on the work, including cases of suspicious transactions.
Features of obtaining cryptocurrency license in different states
In the USA, cryptocurrency licenses are issued by the national regulation bureau FinCEN. The institution issues permits which also allow for the conduct of activities related to:
- foreign exchange services;
- background checks and the provision of prepaid access;
- the issue and sale of traveler’s checks, remittances, and money transfers;
- sales with prepaid access.
You can register a cryptocurrency exchange license in the USA on the national level, valid throughout the entire country, or on the individual state’s level, valid in those states only. If the company is going to conduct real business in America, a general permit is more convenient. The government fee for it is $176,226 – plus an annual fee of $136,855.
While operating outside of the USA, a license that is valid in one state is sufficient. It will provide the right to open the necessary bank accounts and conduct the relevant activities. The size of the government fee for this varies and is defined by the state authorities, starting at 200 dollars in Utah, Kansas, and Idaho, ranging all the way up to 7,000 dollars in Oklahoma (there are individually defined rates as well).
In selecting the territory, organizations must also consider:
- whether cryptocurrency licenses are provided there in general – the USA provides the right to regulation to state authorities; meanwhile, in New Mexico, Montana, and South Carolina, for instance, it is not provided for;
- the necessary amount of the authorized capital for the company being registered and obtaining the license. This varies from 1,000 dollars in Hawaii to one million dollars in Pennsylvania;
- the minimum capital amount for maintaining and developing business. There must be from 1,000 to one million dollars on beneficiaries’ personal or corporate accounts (however, for example, in Georgia, this requirement does not exist);
- what profit tax rates resulting from cryptocurrency operations are established in the state and so on.
Operating environment and licensing, payments and taxes change, and the help of experienced and knowledgeable professionals is needed to make the right choice. You can get competent support from lawyers and specialists in American taxation and cryptocurrency regulation by contacting “Prifinance”. The experts:
- analyze the situation and develop an optimal strategy according to the customers’ needs;
- register a company in the USA;
- will help you open an account, collect documents, check them for completeness and correctness.
Also, experts will represent the customer in the instances. “Prifinance” is professional advice and integrated support.