Country overview

#57

Bulgaria

Country stats

Rating Points

175

This indicator describes the overall rating of a given jurisdiction on several parameters according to cryptocurrency operations - market volume, crypto regulation, business climate, taxation framework.

Crypto Penetration

2.2%

Estimated percentage of crypto users out of the country's total population based on public data.

Legal Entities

Number of crypto companies registered in the country based on regulator data if available or other types of public data.

Regulation Points

100

An overall assessment of the granularity of crypto regulation in a given country. A high score is also given to countries where cryptocurrency transactions are highly regulated.

Amount of crypto users

149 600

Total amount of crypto users out of the country's total population based on public data.

Taxation points

This figure, according to our analysts' calculations, indicates the overall level of tax burden for cryptocurrency transactions in a given country. The higher the indicator, the lower the burden.

Market volume points

A rough estimate of this jurisdiction's retail crypto market relative to the rest of the world. The higher the indicator, the higher the market potential.

Status of crypto

Legally allowed

General status of cryptocurrency regulation in this jurisdiction.

Crypto payments

No info

The legal status of cryptocurrency payments for goods and services in a given country based on information from regulators, public data and feedback from our community.

Security Level

Minor danger

The overall level of security in a given country based on open data.

Crypto Salaries

No info

The legal status of cryptocurrency salaries to employers in a given country based on information from regulators, public data and feedback from our community.

Business Climate

Good

Overall assessment of the friendliness of this country for crypto-business. This indicator takes into account the cost of obtaining a license and the attitude towards crypto entities in the country.

Stablecoin Regulation

Low

This indicator is evaluating the regulation of stablecoins in a given country. Complex regulation means that it is possible to issue steiblcoins and obtain a license for this activity. Basic regulation means that the issuance of stablecoins is possible, but not all legal aspects are defined in the law. Standard regulation means that there is a legal practice of steylcoin circulation in a given country.

Bad Factors

FATF grey list

This section describes the unfavorable economic factors for crypto-business in a given country. These are countries that are under sanctions or on the FATF grey list and other factors.

Types of licenses

Crypto-to-crypto

This license type allows VASP to provide legal exchange from one cryptocurrency to another.

Crypto-to-fiat

This type of license regulates the exchange from cryptocurrency to fiat.

Wallet/Custody

This country has a legal licensing procedure for companies that store cryptocurrency - - crypto wallet providers and custodians.

Good

Medium

Bad

intro

Bulgaria is one of those countries that have recently introduced regulation but have already established themselves as a hub in the EU. For example, this is where the Nexo exchange is licensed.

Security level

Bulgaria has a minor danger security level according to our rating. Jurisdiction has 62.5 points (from 100) for safety level in Numbeo crime rating (1). Homicide level (2) is 1.3 per 100,000 inhabitants a year. Story of firearm-related death (3) 1.51 per 100,000 inhabitants a year.

Crypto Payments

Salary under an employment contract can only be paid (4) in fiat money. The following options remain:

crypto payroll from a foreign company;

accepting payments in crypto under a civil law contract.

Crypto Salaries

Crypto payments are valued (5) (converted) into Bulgarian leva at the time of receipt. They form insurance income and tax base from economic activity.

Legal

The Council of Ministers of Bulgaria adopted a Decree (6) in 2020, which contains information on creating a special register of companies - providers of crypto services to separately designate the obligation of such companies to comply with AML requirements. If you are interested in details of crypto regulation in Bulgaria, you may check the law text in English (7)

Bulgaria has two central crypto regulators: Bulgaria National Bank (BNB) and the Financial Supervision Commission (FSC)(7¹). In two interviews in 2022, the BNB Deputy Governor in charge of the banking department expressed the general unofficial opinion that cryptocurrencies are unregulated in Bulgaria in every aspect, except for anti-money laundering (AML) purposes, and will remain unregulated until general European legislation is adopted (8).

In the present Bulgarian legal framework, cryptocurrencies (Bitcoin, altcoins) are still perceived (9), audited, and declared before the NRA (National Revenue Agency) as financial assets. Their legal status developed with the Anti-money Laundering Act (AML Act) amendment in November 2019.

The 2019 amendments to the Bulgarian Prevention of Money Laundering Act 2018 (AML Act) for the first time, include (10) cryptocurrency exchanges and wallet providers to ensure Bulgarian law is in line with the requirements of the Fourth (*1) and Fifth (*2) AML Directives.

According to this, a virtual currency is the digital representation of a value that is not issued (11) or guaranteed by a central bank or a public body, is not necessarily related to a legally-established currency, and does not have the legal status of cash or money, but is accepted by natural persons or legal entities as a means of exchange and can be transferred, stored and traded electronically.

A definition for “wallet provider” is also introduced (12). This is any natural or legal person or other legal form that provides private cryptographic critical protection services on behalf of its clients for the possession, storage, and transfer of virtual currencies.

Cryptocurrency exchanges and wallet providers must register with the National Revenue Agency (*4) for AML and anti-terrorism financing purposes.

Taxation

Tax name	Index
PIT tax Min	10
PIT tax Max	10
Corporate tax (CIT)	10
Min Individual CGT (for crypto)	10
Max Individual CGT (for crypto)	15
Wealth tax Min	0
Wealth tax Max	0

In 2014, the Bulgarian National Revenue Agency stated (13) that any profit a person who is a tax resident of Bulgaria might gain from trading with Bitcoin and any kind of cryptocurrency is subject to an income tax of 10%.

PIT

A flat tax rate of 10% applies to all personal income, with some exceptions in obedience to PWC (14).

CIT

Corporate income is generally subject to corporate income tax (CIT) at a flat rate of 10% per PWC (15).

CGT

Capital gains are subject to the average PIT rate according to PWC (16), but there is a special rate for crypto - 15%

Links

1)Crime Index by Country 2023 Mid-Year

2)List of countries by intentional homicide rate

3)List of countries by firearm-related death rate

4)Cryptocurrency regulation in Bulgaria. LinkedIn

5)Наръчник за крипто данъци на Tax Monkey. Tax Monkey's Crypto Tax Guide. Article

6)Биткойн регулация: Последни промени в закона. Bitcoin Regulation: Recent Changes in the Law. Article

7)Measures Against Money Laundering Act (Law on the Measures Against Money Laundering ). PDF file

7¹)The Chair of the FSC - Boyko Atanasov opened the Investor Finance Forum 2023

8) Providing international legal business solutions. GLI

9)Do You Need a License For Your Crypto Project In Bulgaria? Article

10, 11 and 12)Cryptocurrency and Wallet Providers: Bulgarian regulation. Article

13)How are cryptocurrencies regulated in Bulgaria? Article

14)Individual - Taxes on personal income. PWC

15)Corporate - Taxes on corporate income. PWC

16)Overview. PWC

Articles

article

Nomad Visas and Crypto Regulation in Thailand

Short overview of available options to move Thai for crypto nomads

research

Crypto Entities Overview: UAE

United Arab Emirates is one of the most cryptofriendly jurisdictions in the world. In this research we set up all licensed crypto entities operating in the country

research

TON Community Research

In this research we’ve calculated an approximate audience of the TON community before adding wallet to Telegram based on public data

intro

Bulgaria is one of those countries that have recently introduced regulation but have already established themselves as a hub in the EU. For example, this is where the Nexo exchange is licensed.

Security level

Crypto Payments

Salary under an employment contract can only be paid (4) in fiat money. The following options remain:

crypto payroll from a foreign company;

accepting payments in crypto under a civil law contract.

Crypto Salaries

Crypto payments are valued (5) (converted) into Bulgarian leva at the time of receipt. They form insurance income and tax base from economic activity.

Legal

Cryptocurrency exchanges and wallet providers must register with the National Revenue Agency (*4) for AML and anti-terrorism financing purposes.

Taxation

Tax name	Index
PIT tax Min	10
PIT tax Max	10
Corporate tax (CIT)	10
Min Individual CGT (for crypto)	10
Max Individual CGT (for crypto)	15
Wealth tax Min	0
Wealth tax Max	0