Belarus has legalised transactions in crypto-currencies, part of a drive to foster private sector growth and attract foreign investment by liberalising parts of its Soviet-style economy.
President Alexander Lukashenko signed a decree on the move on Thursday (December 21), his press service said.
Bitcoin, the world’s most popular crypto-currency, has lost a third of its value since hitting a record high of close to $20,000 on Sunday, but its supporters dismiss warnings over volatility and say it is the start of a new monetary system not dependent on central banks.
The former Soviet republic, squeezed between Russia and the European Union, is still dominated by the state, weighed down by bureaucracy and inefficient state-owned enterprises, and dependent on Russian money and subsidies.
But the country’s President Alexander Lukashenko, a former collective farm manager who once called the internet “garbage”, has introduced some reforms to improve the business climate and shore up the economy after recession in 2015 and 2016.
Belarus has developed some globally recognised IT brands, belying an image of a country stuck in a Soviet time warp.
The decree is designed to attract digital coin entrepreneurs, who are moving businesses to locations more welcoming to crypto-currencies as they face intensifying scrutiny from regulators over digital currency fund-raising, known as initial coin offerings.
The decree legalises initial coin offerings and transactions in crypto-currencies, including their exchange for traditional currencies on Belarussian exchanges, while all trades will be tax-free for the next five years.