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Bitcoin Island: The UK haven leading a revolution
Before the birth of Bitcoin, the Isle of Man - a tiny tax haven in the Irish sea - was famous for three things: motorcycle races, the Bee Gees, and a breed of tailless cat. Today it’s becoming synonymous with cryptocurrencies and fintech.
This is largely linked to the island’s low taxes, relaxed regulations, and high-speed internet connections which have helped fuel a boom in financial services and online gambling on the island. The Economist reports that these two sectors now account for a third and one tenth of the territory’s income, respectively.
Given the potential applications for Bitcoin in both these areas, its no surprise the island is adopting Bitcoin in a big way. Many of the island’s hotels, taxi firms, restaurants and cafes now accept it as payment.
The island’s tax structure, with no corporation, capital gains, or dividend taxes, has also been a draw for bitcoin startups, including exchanges and gambling platforms.
In addition to assisting with the formation of the Manx Digital Currency Association, the local government has encouraged its adoption by bringing in a legal foundation for Bitcoin.
In April, the Isle of Man government changed it Proceeds of Crime Act to cover bitcoin exchanges operating from the island so that business have to comply with the territory’s anti-money laundering (AML) laws.
While this means companies face greater oversight and more filing requirements, it has broadly been seen as positive news for bitcoin business seeking credibility with consumers and financial institutions. It's no wonder then that regulators around the world now have their eyes on this tiny pioneering island.
Photo: Steve Conover