The Czech Republic has passed a new law exempting Bitcoin and other digital assets from capital gains tax if held for more than three years. Signed by President Petr Pavel, the legislation aligns crypto taxation with traditional securities and is set to take effect in mid-2025. The exemption applies to individuals and non-business activities, removing tax disadvantages for long-term crypto investors.
The Chamber of Deputies approved the law in January as part of broader financial regulation reforms, bringing the country’s framework in line with the EU’s Markets in Crypto-Assets (MiCA) rules.
Meanwhile, the Czech National Bank is considering adding Bitcoin to its reserves, though the process is expected to take months. Governor Ales Michl proposed the idea, but ECB President Christine Lagarde opposed it, citing concerns over liquidity and security.
The central bank has commissioned a study to assess Bitcoin’s feasibility, with Michl stating he will respect its findings.
The Czech Republic’s tax exemption for long-term crypto holders is just one of many financial reforms underway. Former Prime Minister Andrej Babiš has called for balanced crypto regulations and fair tax policies, emphasizing the need for a supportive framework during his keynote speech at the Emergence conference in Prague last December.
In addition, the Czech National Bank (CNB) is exploring Bitcoin as part of its reserve diversification strategy. Last week, the CNB board approved a proposal to consider investing in new asset classes, including Bitcoin.
Governor Ales Michl suggested that the central bank could allocate up to 5% of its €140 billion ($146 billion) reserves to the leading cryptocurrency, marking a significant shift in the country’s approach to digital assets.
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