Concept
Today, "crypto-friendly" rests on clear rules and transparent licensing. Serious crypto businesses and large private capital go where the regulator has directly drawn the boundaries of what is permitted and where banks agree to open accounts. In choosing a jurisdiction for your digital flag, you choose a regulator and its requirements for capital, custody, and compliance — and, from 2027, also the regime under which data about your assets will travel to the tax authorities of other countries.
From Vacuum to License
In crypto's early years it lived in a regulatory vacuum, and a "friendly" country was simply one that did not get in the way. That logic is outdated: banks do not open an account without a licence, and counterparties will not work with unlicensed platforms. Competition between jurisdictions has shifted from the absence of rules to their quality and predictability.
UAE: VARA and ADGM
The UAE has built a multi-tiered system. In Dubai, VARA has operated since 2022 — the world's first dedicated virtual-asset regulator; it licenses exchanges, custodians, and brokers on the mainland and in most free zones, except DIFC. In May 2025 VARA rewrote all twelve of its rulebooks, added a separate Virtual Asset Issuance Rulebook and a regime for derivatives, and mutual recognition of licences with the federal regulator SCA now operates nationwide. In Abu Dhabi, ADGM works through the FSRA, which back in 2018 was the first in the world to introduce a comprehensive VASP regime; DIFC (DFSA) is regulated separately. There is no personal income tax in the UAE, but corporate crypto activity has been subject to the 9% federal tax since 2023, while in a free zone with QFZP status the rate on qualifying income remains zero. The key decision here is choosing the right zone for your type of activity.
Switzerland: FINMA and Crypto Valley
Switzerland is the mature, "banking" alternative. FINMA supervises, the Crypto Valley cluster has formed around the canton of Zug, and since 2021 the Distributed Ledger Technology Act (DLT Act) has been in force, legalising tokenised securities and dedicated trading venues. FINMA classifies tokens as payment, utility, and asset — and the regime depends on that classification. Expensive and demanding, but reputationally impeccable.
Singapore: MAS, PSA and DTSP
Singapore regulates crypto through MAS. Services involving digital payment tokens for clients inside the country fall under the Payment Services Act 2019. On 30 June 2025 the DTSP regime under Part 9 of the FSMA 2022 came into force — it captured Singapore companies serving only overseas clients: MAS decided it could not supervise activity that effectively takes place abroad, where the money-laundering risk in such a model is higher. The bar was set high — licences are granted only in exceptional cases and with no transitional period; a base capital of at least S$250,000, a local compliance officer, and an annual audit are mandatory. Maximum reputation, and an entry barrier to match.
EU: MiCA Single Passport
The European Union closed the patchwork of national regimes with the MiCA regulation: since 30 December 2024 only licensed CASPs may provide crypto-asset services, while a single licence passports across the entire EU. Platforms that previously operated under national rules were given a transitional period — at most until 1 July 2026, and countries chose different windows: from six months in the Netherlands and Poland to a full year and a half in most others. ESMA has confirmed there will be no extensions — anyone who has not obtained authorisation by that date winds down operations. For businesses oriented toward the European market, MiCA provides the most predictable framework: unified rules and a single market.
Substance and the Bank Account
A licence opens the door but does not hold it open. The partner bank looks at real presence: an office, local staff, a resident director able to explain the source of funds and the logic of operations. The regulators of the UAE, Singapore, and the EU take economic substance seriously — without it the licence will be revoked and the correspondent bank will close the account at the first review. That is why structures are usually assembled from the end: first you find out which bank is willing to handle the crypto flow and on what terms, and only then do you choose the zone and type of licence. The holding wrapper and beneficial-ownership transparency are put in place from the start, so the structure does not have to be reworked for compliance after the fact.
Transparency: CARF and Automatic Exchange
The era of crypto anonymity is closing. The OECD has launched the Crypto-Asset Reporting Framework — a CRS analogue for digital assets: from 2026 crypto services collect data on clients and transactions, and from 2027 tax authorities begin exchanging it automatically. Around fifty jurisdictions signed up for the start, and more than seventy have announced their intention to join; in the EU, CARF is introduced through the DAC8 directive. Exchanges, brokers, and some wallet services report — they identify the user and their tax residency. The conclusion is simple: even the UAE, with zero personal tax, passes information to the place where you are a tax resident, so the choice of crypto jurisdiction is now inseparable from the question of where and how you pay taxes.
This material is for informational purposes and is an expert overview, not individual legal advice. Regulatory requirements and capital thresholds should be verified for your specific project.