Finland is one of the leading countries for Bitcoin activity per capita and already made its mark in 2013 for opening the first Bitcoin ATM in Europe. An estimated 50,000 people are involved in the Bitcoin community.
“Finland offers a very good operating environment for mining cryptocurrencies, thanks mostly to the vast supply of low-cost renewable energy and affordable business premises ready for data mining operations. Furthermore, with us Finns, cryptocurrencies are considered equal to cash, so Bitcoins are already accepted as a form of payment in many shops and restaurants. The fact that there are very few regulations related to cryptocurrencies also makes Finland an easy operating environment for Bitcoin businesses,” says Toni Mattila, Senior Director, Investment Consulting, Finpro’s Invest in Finland.
Recently, it has been the global success of Finnish company LocalBitcoins that has attracted attention in the Bitcoin world. Now Jyväskylä-based Prasos Oy is also setting its sights on international growth. Prasos was founded in 2012 and has grown into a leading Bitcoin service provider in the Nordic countries.
“The lack of regulations makes operating a Bitcoin business simple in Finland, but working with the banks is more difficult because the Finnish Financial Supervisory Authority is not involved, as it does not supervise Bitcoin companies,” says Henry Brade, CEO of Prasos.
Changes in legislation and taxation expected
Finland’s regulatory landscape is set to change when the EU introduces new legislation on cryptocurrencies and harmonises legislation across the union, probably sometime in 2018.
“Depending on the type of Bitcoin business, I think that the changes will be mainly positive because cooperation with the banks will be smoother, but increased regulation may have a negative impact for cash exchanges,” Brade explains.
Finland classified Bitcoin as a VAT-exempt financial service in 2014. Brade has no complaints about the taxation of Bitcoin companies but views the current Finnish tax regime as unfair towards individual investors.
“Private individuals are now challenging this through the Central Tax Board, and will take their cases to court if necessary. The amount of money involved is substantial because people have sold large sums of Bitcoin as a result of its recent rise in value.”
Prasos seeks growth funding
Brade considers the future prospects for the Bitcoin business to be very positive in Finland and globally. Prasos has expanded its service scope through the acquisition of Coinmotion and Bitcoinkaupat, and is starting a growth funding round in November 2017 to broaden its cryptocurrency investment operations.
“We see huge potential for expansion and growth, especially in Europe. In Finland, we will focus on making Bitcoin investing safe and more approachable to traditional investors.”
Bitcoin Embassy Helsinki spreads the word
Bitcoin investor Martin Albert opened Bitcoin Embassy Helsinki as a non-profit venue in July 2016. The cozy embassy at Eerikinkatu 33 serves as an informal meeting place, organising events and providing information to anyone interested in Bitcoin.
“In Finland the Bitcoin community is quite active and really tech-driven. The people who get involved tend to come from an IT rather than a business point of view,” says Albert, who has worked at the European Chemicals Agency in Helsinki and is an investor and manager in six Bitcoin startups of the Bitalo group.
“In Finland you don’t need a license to run anything with Bitcoin but the banks are strict. For example in Germany it’s the other way round. The advantage of locating a business here is that the Finns are open-minded to technology, there are many highly qualified people available who used to work for Nokia, and everyone speaks English.”