Åland Islands

{
  "analysis_text": "The regulatory status of cryptocurrency in the \u00c5land Islands is \u0027Allowed-Regulated\u0027, derived directly from its political relationship with Finland. \u00c5land is an autonomous, demilitarized region of Finland with its own parliament and extensive legislative powers in areas such as education, health, and internal administration. However, under the \u0027Act on the Autonomy of \u00c5land\u0027 (1144/1991), legislative power over banking, credit, insurance, and foreign exchange is explicitly reserved for the Finnish State. Therefore, Finland\u0027s financial regulations, including those governing cryptocurrencies, apply automatically in \u00c5land.\n\nThe primary regulatory framework is the \u0027Act on Virtual Currency Providers\u0027 (572/2019), which entered into force on May 1, 2019. This act transposed the EU\u0027s 5th Anti-Money Laundering Directive (AMLD5) into Finnish law. It mandates that all virtual currency exchange services and custodian wallet providers operating in Finland (including \u00c5land) must register with the Finnish Financial Supervisory Authority (FIN-FSA). The FIN-FSA maintains a public register of supervised entities and has the power to impose fines or revoke registrations for non-compliance. Retail investors in \u00c5land are free to trade cryptocurrencies on these registered platforms or foreign exchanges that accept Finnish residents.\n\nTaxation for \u00c5land residents follows the Finnish national model for capital income. The Finnish Tax Administration (Vero) treats cryptocurrency as property, not currency. Gains from the disposal of crypto assets are taxed as capital income at a rate of 30% for amounts up to \u20ac30,000 and 34% for amounts exceeding that threshold. Mining income is typically treated as earned income. While \u00c5land has municipal taxation powers, capital income tax is levied by the State, ensuring a uniform tax treatment for crypto gains across the entire country.\n\nA unique nuance for \u00c5land involves the \u0027Right of Domicile\u0027 (hembygdsr\u00e4tt), which restricts the right of non-residents to own land or conduct business in the region. While this does not prevent an individual from trading crypto, it creates a barrier for foreign crypto companies wishing to establish a physical headquarters in Mariehamn compared to Helsinki. Furthermore, while \u00c5land has a separate gambling monopoly (Paf) regulated by the \u00c5land Lottery Inspectorate, this distinction does not extend to financial trading products. As the EU\u0027s MiCA regulation comes into full force by the end of 2024, \u00c5land will transition alongside Finland from the national registration regime to the EU-wide licensing framework.",
  "confidence_level": "High",
  "executive_summary": "Retail cryptocurrency trading is legal and regulated in the \u00c5land Islands, which falls under the financial regulatory jurisdiction of Finland. While \u00c5land is an autonomous region with its own parliament, banking and financial market regulation are powers reserved by the Finnish State. Consequently, the Finnish \u0027Act on Virtual Currency Providers\u0027 applies, requiring service providers to register with the Finnish Financial Supervisory Authority (FIN-FSA).",
  "grounding_urls": [
    {
      "resolved_url": "https://helpcenter.coinmotion.com/taxation-of-cryptocurrencies-in-finland-1",
      "title": "coinmotion.com",
      "url": "https://vertexaisearch.cloud.google.com/grounding-api-redirect/AUZIYQFbKBQoBdCoqEJMQ0rzlXu_nNXRYE7-tfhkETjpqvlSoGZtsBZ5qrNzt-WCtNnKfRDcIRcMIUvoGIiB_Vkth974Ld_XarfJDtQqNHmAixd5zQ4HSisiKtnyHoaG9-HTJGfgetquUHF2NL1tYakvSfayC06kTVg_H3s8rA8RiYpgkXP95b3Q"
    },
    {
      "resolved_url": "https://legal-gaming.com/legal-gaming-finland-gambling-guide/",
      "title": "legal-gaming.com",
      "url": "https://vertexaisearch.cloud.google.com/grounding-api-redirect/AUZIYQEsMaRNcNgtDTBJW-IKhdLP1nEF_MA8lbZa9gneyukDXoaAr-f-pJVzRatCQZvZACKviggPTGUSgGGcTRMzRze7frRXjYv8KRniY0Tv1Mgb9X3stEYRO5cFb6GuhDg04wir9El0g700je2R0io5b2YwquAj0V6BIw=="
    },
    {
      "resolved_url": "https://www.vero.fi/en/individuals/property/investments/virtual-currencies/",
      "title": "vero.fi",
      "url": "https://vertexaisearch.cloud.google.com/grounding-api-redirect/AUZIYQE3nFAABvJxj9Vgd87WhZUwNc8DuuCFTC6j-SOBgwAP-RtmF3nz3NCiLN07kqWp4NWOrG0malTsHtO8se4n8QM6Uffrw3QfKZ6J46WVWU3R_p2Ty6swmWoxYgi78BjM9PHgrP0eu8XAs3jHEBV2UggHmqKENau0nt9FZhONRqFAbIpZ5uBB"
    },
    {
      "resolved_url": "https://www.bitgo.com/",
      "title": "bitgo.com",
      "url": "https://vertexaisearch.cloud.google.com/grounding-api-redirect/AUZIYQFkHPN8ZC_Fra7MDwiej8O3lAkhiCY9jG26FIYOYx4coGtG3ISfPxb8phxp0mZ_ksYvAxSsrzZkM4a00H3yeix1rLHdKLI6eSNT4dkLuF5-0RQ="
    },
    {
      "resolved_url": "https://acealliance.com/finland/online-casinos/crypto/",
      "title": "acealliance.com",
      "url": "https://vertexaisearch.cloud.google.com/grounding-api-redirect/AUZIYQGOmh350cZo1EkJcKOYb7R_GVYu3hSIJyEClqhzejL9dnWKQC_OgYHKMGIrXWe67ntNFLDGBWqLBaKlht-xTSTILjZOWGM1g1JzFBPJ6zPSfgKb6iObRQmMBFQCFh8qbYDRqqWRwNZVan4hSZx7MpaR"
    },
    {
      "resolved_url": "https://divly.com/en/guides/crypto-taxes-finland",
      "title": "divly.com",
      "url": "https://vertexaisearch.cloud.google.com/grounding-api-redirect/AUZIYQGWMeBj19-7-cxNuTHMWBlvZQCaFsvnXF4uSksq1VMOEEl6d3j4YaKMO_iuhfl2Vmu3KudTUlfOCG2pB0y3yNwXM7HaIgYRxjCPkfPWjimNa2o9I6j3M8ppII0iw8E3QtJ7AtCDrYb0P_dv"
    }
  ],
  "status": "Allowed-Regulated",
  "structured_data": {
    "confidence_level": "High",
    "detailed_analysis": "The regulatory status of cryptocurrency in the \u00c5land Islands is \u0027Allowed-Regulated\u0027, derived directly from its political relationship with Finland. \u00c5land is an autonomous, demilitarized region of Finland with its own parliament and extensive legislative powers in areas such as education, health, and internal administration. However, under the \u0027Act on the Autonomy of \u00c5land\u0027 (1144/1991), legislative power over banking, credit, insurance, and foreign exchange is explicitly reserved for the Finnish State. Therefore, Finland\u0027s financial regulations, including those governing cryptocurrencies, apply automatically in \u00c5land.\n\nThe primary regulatory framework is the \u0027Act on Virtual Currency Providers\u0027 (572/2019), which entered into force on May 1, 2019. This act transposed the EU\u0027s 5th Anti-Money Laundering Directive (AMLD5) into Finnish law. It mandates that all virtual currency exchange services and custodian wallet providers operating in Finland (including \u00c5land) must register with the Finnish Financial Supervisory Authority (FIN-FSA). The FIN-FSA maintains a public register of supervised entities and has the power to impose fines or revoke registrations for non-compliance. Retail investors in \u00c5land are free to trade cryptocurrencies on these registered platforms or foreign exchanges that accept Finnish residents.\n\nTaxation for \u00c5land residents follows the Finnish national model for capital income. The Finnish Tax Administration (Vero) treats cryptocurrency as property, not currency. Gains from the disposal of crypto assets are taxed as capital income at a rate of 30% for amounts up to \u20ac30,000 and 34% for amounts exceeding that threshold. Mining income is typically treated as earned income. While \u00c5land has municipal taxation powers, capital income tax is levied by the State, ensuring a uniform tax treatment for crypto gains across the entire country.\n\nA unique nuance for \u00c5land involves the \u0027Right of Domicile\u0027 (hembygdsr\u00e4tt), which restricts the right of non-residents to own land or conduct business in the region. While this does not prevent an individual from trading crypto, it creates a barrier for foreign crypto companies wishing to establish a physical headquarters in Mariehamn compared to Helsinki. Furthermore, while \u00c5land has a separate gambling monopoly (Paf) regulated by the \u00c5land Lottery Inspectorate, this distinction does not extend to financial trading products. As the EU\u0027s MiCA regulation comes into full force by the end of 2024, \u00c5land will transition alongside Finland from the national registration regime to the EU-wide licensing framework.",
    "executive_summary": "Retail cryptocurrency trading is legal and regulated in the \u00c5land Islands, which falls under the financial regulatory jurisdiction of Finland. While \u00c5land is an autonomous region with its own parliament, banking and financial market regulation are powers reserved by the Finnish State. Consequently, the Finnish \u0027Act on Virtual Currency Providers\u0027 applies, requiring service providers to register with the Finnish Financial Supervisory Authority (FIN-FSA).",
    "important_considerations": [
      "**Taxation:** Crypto profits are taxed as capital income (capital gains) at 30% (up to \u20ac30,000) or 34% (exceeding \u20ac30,000). Losses are deductible against other capital gains.",
      "**Right of Domicile (Hembygdsr\u00e4tt):** Non-residents face restrictions on owning real estate and establishing businesses in \u00c5land, which may complicate setting up a physical crypto exchange HQ locally, though it does not restrict individuals from trading.",
      "**Gambling vs. Trading:** \u00c5land has its own gambling regulator (\u00c5lands Lotteriinspektion) and monopoly (Paf), distinct from Finland\u0027s. However, crypto trading is classified as a financial service (FIN-FSA jurisdiction), not gambling.",
      "**Banking Access:** \u00c5land banks (e.g., \u00c5landsbanken) generally follow Finnish compliance standards; crypto-related transfers are permitted but subject to strict AML checks."
    ],
    "key_regulatory_pillars": [
      "Finnish Financial Supervisory Authority (FIN-FSA) as the primary regulator",
      "Mandatory VASP registration for exchange and wallet providers under the Act on Virtual Currency Providers",
      "Compliance with EU AMLD5/AMLD6 directives for KYC and AML",
      "Implementation of the EU Markets in Crypto-Assets (MiCA) Regulation"
    ],
    "landmark_legislation": [
      {
        "date_enacted": "2019-05-01",
        "identifier": "572/2019",
        "name": "Act on Virtual Currency Providers",
        "summary": "The primary Finnish law governing crypto assets, requiring virtual currency providers to register with the FIN-FSA, hold client funds separately, and comply with AML/CFT regulations. It applies to \u00c5land as financial regulation is a State competence.",
        "url": "https://www.finlex.fi/en/laki/kaannokset/2019/en20190572"
      },
      {
        "date_enacted": "1991-08-16",
        "identifier": "1144/1991",
        "name": "Act on the Autonomy of \u00c5land",
        "summary": "Defines the division of powers between \u00c5land and the Finnish State; specifically reserves \u0027banking and credit\u0027 and \u0027foreign exchange\u0027 as State legislative powers, ensuring Finnish financial laws apply in \u00c5land.",
        "url": "https://www.finlex.fi/en/laki/kaannokset/1991/en19911144"
      },
      {
        "date_enacted": "2023-05-31",
        "identifier": "EU 2023/1114",
        "name": "Markets in Crypto-Assets Regulation (MiCA)",
        "summary": "EU-wide regulation establishing a harmonized framework for crypto-assets, replacing national registration regimes with a comprehensive licensing system fully effective by December 2024.",
        "url": "https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32023R1114"
      }
    ],
    "notes_and_comments": "\u00c5land\u0027s autonomous status is often a source of confusion for regulatory analysis. It is crucial to distinguish between \u0027internal affairs\u0027 (\u00c5land competence) and \u0027financial markets\u0027 (State competence). For crypto trading, \u00c5land is effectively Finland.",
    "primary_sources": [
      {
        "date": "2019-05-01",
        "key_quote": "The Financial Supervisory Authority shall act as the supervisory authority referred to in this Act.",
        "source_type": "law_text",
        "title": "Act on Virtual Currency Providers (572/2019)",
        "url": "https://www.finlex.fi/en/laki/kaannokset/2019/en20190572"
      },
      {
        "date": "1991-08-16",
        "key_quote": "The State shall have legislative power in matters relating to... banking and credit... foreign exchange.",
        "source_type": "law_text",
        "title": "Act on the Autonomy of \u00c5land (1144/1991)",
        "url": "https://www.finlex.fi/en/laki/kaannokset/1991/en19911144"
      },
      {
        "date": "2024-01-01",
        "key_quote": "Virtual currency providers must register with the Financial Supervisory Authority.",
        "source_type": "regulator",
        "title": "Virtual currency providers - FIN-FSA",
        "url": "https://www.finanssivalvonta.fi/en/registers/supervised-entities/virtual-currency-providers/"
      },
      {
        "date": "2024-05-12",
        "key_quote": "Income from virtual currencies is taxed as capital income.",
        "source_type": "official_government",
        "title": "Taxation of virtual currencies - Vero.fi",
        "url": "https://www.vero.fi/en/individuals/property/investments/virtual-currencies/"
      }
    ],
    "remaining_uncertainties": [
      "Whether the \u00c5land government plans to introduce any specific local incentives for blockchain businesses within the constraints of State law.",
      "Specific enforcement statistics for crypto-related AML violations within \u00c5land specifically, as opposed to Finland generally."
    ],
    "secondary_sources": [
      {
        "date": "2024-01-01",
        "key_quote": "The Act on Virtual Currency Providers went into effect on May 1, 2019.",
        "source_type": "analysis",
        "title": "Finland Cryptocurrency Laws and Regulations",
        "url": "https://freemanlaw.com/cryptocurrency/finland/"
      },
      {
        "date": "2024-01-01",
        "key_quote": "\u00c5land\u0027s Provincial Law on Lotteries... Act on Virtual Currency Providers (572/2019).",
        "source_type": "analysis",
        "title": "Gambling Law in Finland and \u00c5land",
        "url": "https://legal-gaming.com/gambling-law-finland"
      }
    ],
    "status": "Allowed-Regulated"
  }
}