Germany vs Iceland
Crypto regulation comparison
Germany
Iceland
Legal
Legal
Germany has one of the most well-defined crypto regulatory environments in Europe. BaFin has regulated crypto custody as a financial service since 2020. Notably, crypto held for over one year by individuals is completely tax-free, making Germany one of the most favorable jurisdictions for long-term holders.
Cryptocurrency is legal in Iceland and subject to a 22% capital gains tax. Iceland is a major crypto mining destination due to abundant geothermal and hydroelectric energy. As an EEA member, Iceland follows EU financial regulations including MiCA through EEA incorporation.
Tax Type
Capital gains
Tax Type
Capital gains
Tax Rate
0-45%
Tax Rate
22%
Exchanges
Yes
Exchanges
Yes
Mining
Yes
Mining
Yes
Regulator
BaFin (Bundesanstalt für Finanzdienstleistungsaufsicht)
Regulator
FME (Fjármálaeftirlitið / Financial Supervisory Authority), Central Bank of Iceland
Stablecoin Rules
Regulated under MiCA; BaFin already licensed crypto custody under existing German law since 2020
Stablecoin Rules
No specific stablecoin regulation; follows EEA guidelines
Key Points
- Crypto held for more than 1 year is completely tax-free for individuals
- Short-term gains (under 1 year) taxed as income at up to 45% plus solidarity surcharge
- Annual exemption of €1,000 for short-term crypto gains (since 2024, previously €600)
- BaFin licenses crypto custody businesses under the KWG (German Banking Act) since January 2020
- MiCA framework applicable from December 2024, complementing existing German regulation
Key Points
- 22% capital gains tax on crypto profits
- Iceland is one of the world's largest crypto mining locations due to cheap renewable energy
- FME supervises crypto businesses under AML/KYC regulations
- As an EEA member, Iceland incorporates EU financial regulations including MiCA
- Capital controls (imposed 2008-2017) originally complicated crypto usage but have been lifted