Belarus, the East-European country has become the first country to legalise digital tokens, cryptocurrencies and all the related issues. President Lukashenko, famously known as Europe’s last dictator who once called the internet as “garbage”, has recently introduced some reforms to improve the business climate and shore up the economy after recession in 2015 and 2016.
“All smart and intelligent people know what stability and order are. They’re all trying to reach that shore. We’re prepared to arrange a dock and even a harbor.” state news agency BelTA quoted President Lukashenko as saying earlier this month.
The Digital Economy Development Ordinance first reported by state owned media BeITA on 22 December also allows local IT companies to operate in part under English law – a boon to potential foreign investors, who struggle to navigate the Belarussian legal system. The ordinance further makes revenue and profit from all operations using digital tokens exempt from taxes until 2023.
“We regularly faced legal problems. When a Western company buys a Belarussian company they try to structure the deal outside Belarus,” said Denis Aleinikov, senior partner in law firm Aleinikov and Partners in Minsk and the main author of the decree.
The Belarussian IT sector has flourished despite the country’s wider economic slump that is hamstrung by loss-making state-owned companies that have seen little or no reform since the collapse of the Soviet Union. IT sector is one of the few success stories of the soviet country that attracts foreign workers, expatriate Belarussians and locals to jobs that pay about five times the average wage.
Belarus High Technologies Park (HTP), a Belarusian analog of Silicon Valley established in 2005 houses leading software firms of the world. It is a special economic zone offering special tax and legal regime for the companies operating in it. Under the Digital Economy Development Ordinance Foreign employees and founders of HTP resident companies no longer require visas.