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Crypto Exchanges & Regulation – Top exchanges in Germany by Coincub criteria
| Total population | 83,294,633 |
| GDP (in USD Millions) | 4,591,100 |
| Total # of universities | 461 |
| Leading blockchain universities | 80 |
| Jobs in blockchain | 1,138 |
| Bitcoin mining | 0.20% |
| CBDC stage | - |
| Crypto received (in USD$) | 1.09B |
| Crypto sent | 1.23B |
| Bitcoin ATMs | 194 |
| Bitcoin nodes | 1,689 |
| Companies with bitcoin in treasury | 2 |
| Population % owning crypto | 8.3% |
| Crypto exchanges based in country | 7 |
| Bitcoin Interest | 12 |
| ICOs (Initial Coin Offerings) | 122 |
| ICOs energy | 6 |
| Fraud crypto score | 1 |
| Crypto financial services | 18/50 | |
| Web3 population adoption | 9.5/20 | |
| Web3 environmental impact | 4/20 | |
| Crypto trading | 8/20 | |
| Web3 talent | 17.5/30 | |
| Web3 proliferation | 14/30 |
Based on the interview between Sergiu Hamza and Florian Wimmer on the October 7, 2024 Florian Wimmer sits poised in his Amsterdam hotel room, a serene oasis amidst the city’s bustling canals and cobblestone streets. “I’m here for the BTC Amsterdam Conference,” Florian mentions, settling comfortably into his chair. As the CEO of Blockpit, a […]
1. Tell us about the vision in establishing the Lyvely platform and the ecosystem of investors, partners and creators which you’ve built so far We started Lyvely after witnessing many of our friends and family lose their livelihoods for a period of time during the pandemic lockdowns. It was clear to us that those without […]
Early this year, the U.S. Securities and Exchange Commission (SEC) approved the trading of spot Bitcoin ETFs, granting the cryptocurrency entry into the traditional securities market. Digital assets are becoming increasingly popular, with statistics expecting the number of users in the market to climb by 24% and hit over 865 million by the end of […]
No.
Is Germany crypto-friendly?
Yes. Germany is a global leader in cryptocurrency and bitcoin adoption. Setting the pace on overall crypto strategy with its Federal Finance Ministry issuing new guidance on the crypto income tax. Staked or lent cryptocurrencies are still tax-free if held for over one year and individuals can sell Bitcoin or Ether free of income tax-free after holding it for one year. Included in the guidance is the tax treatment of mining, staking, lending, hard forks, and airdrops. Guidance is comprehensive with one-year tax exemptions also applying to utility tokens. On the other hand, the development of Defi overall needs to be controlled in some way as European Union regulators debate whether its new MiCA (Markets in Crypto Assets) law should extend beyond cryptocurrencies to include Web 3 innovations and NFTs in the financial sector. Defi needs to be brought into line in order to work with the existing financial market according to Birgit Rodolphe, an anti-money laundering official at German financial regulator BaFin. Defi technology runs across insurance, lending, and securities but the MiCA laws were initially conceived to regulate stablecoins and the issue is still to be debated.
Price falls, aside, Germany has long ago taken a positive stance on cryptocurrency investment and the current position of major savings institutions looking into offering wallets to trade crypto for savers is another huge step. Germany is already one of the world’s most crypto-friendly countries and now even more so with the Federal Financial Supervisory Authority issuing a crypto custody business license for Coinbase’s German arm earlier this year.
DZ Bank, a top three German bank is looking towards offering a digital asset custody service. It is said to be driven by public demands (like most things crypto) centred more around forms of digital financial instruments rather than out-and-out cryptocurrency dealing but able to cater to both. This important step is also paralleled by Commerzbank which also indicated that it applied for the crypto custody license in the first quarter of 2022 enabling it to offer exchange services along with custody and protection of crypto-assets. Commerzbank is a giant of a bank, with individual and institutional clients but its custodial services – like those of DZ look likely to target institutional investors and crypto investment products, per CoinTelegraph. Since 2020, all enterprises looking to offer cryptocurrency services in Germany need approval from the Federal Financial Supervisory Authority.
Germany’s commitment to blockchain and crypto
The country also has the highest number of Bitcoin nodes – along with the US which demonstrates a widespread commitment to blockchain and crypto. German stock market operator Deutsche Boerse has also listed more than 20 crypto exchange-traded products on its digital exchange, Xetra.
The high interest in crypto assets perhaps reflects Germany’s traditional reputation as a nation of savers (Britain’s reputation, of course, is as a nation of spenders), and also the country’s traditional excellence in new technologies. Over the years of negative interest rates – now changing across Europe as inflation begins to take hold – many Germans saw the value of their savings eroding, perhaps leading to the enthusiasm for cryptocurrency investment which wasn’t in the hands of the traditional banking system – and all its perceived shortcomings.
A law taking effect at the time of writing will enable so-called Spezialfonds to invest up to 20% of their holdings in Bitcoin and other crypto-assets. These are specialized investments, accessed only by institutions such as pension funds and insurers, but it is another move into the mainstream for crypto at least. At the individual level, German savings banks are planning to allow customers to invest in major digital currencies like Bitcoin (BTC) and Ether (ETH) directly from their bank accounts. Representing huge total savings on behalf of some 50 million customers, the move is seen by some as potentially radical but there is no doubt that the move is fuelled by demand.
Blockchain, like everywhere else, is capturing the imagination of German businesses with many seeing it as an important future technology that has yet to be fully assessed and exploited. In the pipeline, however, is stricter regulation against money laundering and anonymity with the likelihood that the tax exemption for holding crypto over one year may be extended to ten years – which may dampen enthusiasm. Nevertheless, the potential for savers to trade crypto, and the fact that an increasing number of financial institutions are offering products and platforms for crypto, such as Bison, the crypto trading app of the Stuttgart Stock Exchange, opens up the possibility of other leading institutions offering the same services. All such activity moves Germany well up the ranking board to 2.
Germany prefers to stick to its existing financial regulatory regime regarding cryptocurrency and distributed ledger developments across capital markets, banking, financial services, anti-money laundering (AML), and other laws. Bitcoin and other cryptocurrencies, however, come within the latest German law on electronic securities – eWpG. Germany, in line with the European Union, looks to balance the elimination of risks with maintaining innovation but, unsurprisingly, a certain amount of complexity exists with so many financial and regulatory bodies involved and also the never ceasing developments in assets and technologies. The aim of an EU-consistent regulatory framework for crypto assets will shape the future of crypto asset regulation in Germany.
Germany has taken firm and imaginative action in accommodating the growth of cryptocurrency and blockchain technology – in part driven by negative interest rates on traditional cash deposits and demand from investors. The capital, Berlin, is a hot spot for spending crypto, so all in all Germany earns an 8.1/10.
Generally speaking, cryptocurrencies are considered legal across the European Union, but cryptocurrency exchange regulations depend on individual member states. Regulations may vary by the member state, and by compliance with the European Banking Authority (EBA), European Commission (EC), European Central Bank (ECB), European Insurance & Pension (EIOPA), and European Supervisory Authority for Securities (ESMA). Cryptocurrency taxation also varies but many member states charge capital gains tax on cryptocurrency-derived profits at rates of 0-50%.
Trading bitcoin and other cryptocurrencies is well-developed, and the German financial sector is looking to develop its influence and expertise in crypto trading.
The German Federal Central Tax Office or Bundeszentralamt für Steuern (BZSt) treats bitcoin and other cryptocurrencies as private money for tax purposes. At present, it’s not treated as foreign currency, legal tender, or as property under the German Tax Acts.
Germany has taken the bull by the horns on many aspects of the crypto economy. A recent Amending Directive made it one of the first countries to enable financial institutions to use crypto assets. More positive and assertive guidance and legislation look certain to follow, especially as with negative interest rates on traditional bank-held deposits, people are seeking to invest in crypto to make gains.
Currently, cryptocurrencies are treated as private money in Germany and offer small advantages for individuals. For example, any sales under 600 Euros carry tax exemptions, so a small transaction that gained a profit of, say, 200 euros, would not be taxable.
However, holding on to your crypto for a longer period offers bigger advantages. For example, if you hold your crypto for over a year as an individual, there is no tax liability on your earnings. In other words, any increase in the value of your cryptocurrency over a year is tax-free, but if it is sold after being held for less than a year, it is subject to income tax.
Under current income tax laws, if you are trading cryptocurrencies the net amount gained or lost at the time of sale is taxed as income. This applies whether you are trading one cryptocurrency for another or into fiat. Fees, of course, are deductible.
Purchasing products and services with your hard-earned crypto is treated the same as trading them. So if you acquire bitcoin and then purchase something with it, you’ll be taxed on whatever gains your bitcoin has made before you spent it – assuming you’ve held it for under a year. If you hold bitcoin for a year or more before using it – you won’t be taxed. It sounds eminently reasonable.
Remember any crypto transactions which are viewed as financial instruments will be treated separately from your passive non-trading crypto holdings, and you will not be able to transfer your net losses and gains between these two types of crypto investment.
As we have said, the tax treatment of cryptocurrencies for individuals and companies is different – there is no tax exemption for holdings of crypto over a year for businesses as there is for individual investors.
The Federal Ministry of Finance (BMF) has ruled that crypto transactions made by individuals are not subject to Value Added Taxes (VAT) for all EU member states. Even though investing or trading in cryptocurrencies such as bitcoin is legal and well-established, the gains or losses you make will definitely have a bearing on your tax situation.
As with most countries, holding Bitcoins in your wallet and sitting on them, or transferring them between wallets incurs no tax, but make sure you aren’t getting confused –it’s easy to do – between transferring them, transacting them or disposing of them.
As with any income, your bitcoin will come under the tax laws of the country you become a legal resident. If you move outside Germany but are still a resident, make sure you have detailed transaction reports about your purchases and sales across all exchanges you used. If you set up a business to trade bitcoin, that business will come under the tax laws of the country it operates from.
It’s highly technical and beyond the scope of most individuals but mining for bitcoin or any other cryptocurrencies is, you guessed it, a taxable event. In Germany, the mining of crypto by individuals is taxed as other income, and the taxable amount is the net profit you make on your mined coin. So, if you are mining bitcoin, you are taxed on the sale price of your crypto at the time of disposition minus the costs associated with mining it. Oh yes, and mining bitcoin and other cryptos as a business are subject to very different taxation rules that you need to be aware of.
You can make business deductions for equipment and resources used in mining but deductions are related to whether you are mining as business or for personal gain. Your mined bitcoin will be valued at its fair market price and you’ll also be taxed on your transactions with it.
Investing in bitcoin has become increasingly recognized by Germany’s financial institutions, with legislation enabling 4,000 Spezialfonds to invest in crypto assets. This will likely allow the indirect investment of bitcoin-linked funds for retirement purposes.
Germany’s financial services and crypto banks are becoming increasingly open, with banks now able to take custody of crypto. Banks have an increasing role in formalizing legislation and tax laws while stimulating the crypto economy.
Much legislation has been passed to ensure licensing and compliance by crypto-related service providers, but as yet it is not clear how the existing financial framework can accommodate Defi.
There are several ways to buy Bitcoin in Germany:
It’s important to keep in mind that buying Bitcoin and other cryptocurrencies carries risks, and you should always conduct your own research and consult with a financial professional before making any investment decisions.
And also make sure to check the legal framework of your country before buying any bitcoin, regulations may vary.
There are several different types of cryptocurrency wallets, each with its own advantages and disadvantages. The best crypto wallet for you will depend on your specific needs and use case. Here are a few popular types of wallets that are available in Germany:
Ultimately, it is highly recommended to do your own research and consult a professional before deciding which crypto wallet to use.
Bitcoin Berlin! When it comes to crypto, Berliners have been leading the way in spending bitcoin. Plenty of businesses have been up for accepting cryptocurrency in one form or another as payment.
The way is open to dentistry (as usual), buying property, holidays, entertainment, and certain educational establishments. The European School of Management and Technology (ESMT), for example, was one of the earliest places to accept it. Several world brands accept bitcoin payments including, most famously, Microsoft and Starbucks. In most cases, it is possible to buy vouchers with your currency that may then be indirectly used with participating outlets.
If you’re feeling generous you can gift crypto, but it is also subject to German gift tax if you hold your cryptocurrency at an exchange located abroad. It is also dependent upon the extent to which you or the person receiving the gift is a tax resident in Germany. You can gift crypto to a recognized charity or non-profit organization free of tax, and most crypto exchanges will be able to advise on gifting your coins.
Best exchanges in Germany
| NAME | RATING | FOUNDED DATE | DEPOSIT METHOD | BASED IN | REVIEW | SIGN UP | ||
|---|---|---|---|---|---|---|---|---|
| #1 |
|
Crypto.com | 4.6 | 2016 | Credit Card Bank Transfer | Singapore | Coincub Review | Register Now |
| #2 |
|
OKX | 4.25 | 2017 | Bank card P2P third-parties crypto | Seychelles | Coincub Review | Register Now |
| #3 |
|
Gate.ioSponsored | 4.0 | 2013 | Bank Transfer Credit Card Debit Card SEPA Apple Pay Google Pay | Cayman Islands | Coincub Review | Register Now |
| #4 |
|
Bybit | 3.6 | 2018 | Card Crypto Sepa Wise Alipay Wechat Apple Pay Google Pay | UAE | Coincub Review | Register Now |
Crypto.com
4.6
OKX
4.25
Gate.ioSponsored
4.0
Bybit
3.6
German cryptocurrency regulations stipulate that individuals and legal entities can buy/sell/hold crypto assets as long as it is via a BaFin (Federal Financial Supervisory Authority) licensed exchange, custodian or Bitcoin ATM. Germany is one of the first countries in the world to provide guidance to financial institutions on the custody of crypto assets. However, claiming a loss through fraud or theft is quite complex as there are so many definitions to comply with, including asset price and circumstances. If your crypto wallet has been stolen, you cannot claim any immediate tax relief, but you should record any losses as you can offset these with any future crypto profits within one year. You’ll also need to make clear whether your losses were part of a trading business or for personal investment purposes. Reputable exchanges carry insurance against fraud or hacking, so in this event, you’re more likely to be claiming some form of compensation from the exchange.
There are requirements to provide identification when purchasing crypto in Germany, and you’ll need to keep records for tax purposes. While it may be possible to purchase with a degree of anonymity, this requires taking extensive measures, and you’ll still have to declare your trading for tax purposes.
| Level | Income Tax Rate |
| €0 – €9.984 | 0% |
| €9,951 – €40,525 | 14% – 42% |
| €40,526 – €86,375 | 42% |
| from 277.826 € | 45% |
| EVENT | TYPE OF INCOME | TAX RATE | LEVEL | CAPITAL GAINS TAX RATE |
|---|---|---|---|---|
| Margin/Futures with crypto | § 20 EStG | Capital Gains Tax Rate | no limit | 25% |
| Income with crypto | § 22 Nr. 3 EStG | Income Tax Rate | no limit | 25% |
| Trading with crypto | § 23 EStG | Income Tax Rate | no limit | 25% |
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