The Bulgarian Stock Exchange (BSE) gave investors in the country to several new assets from February 16th, Wednesday. Investors will be able to use these assets to bet on the price movements of two of the world’s largest cryptocurrencies that exist i.e. Bitcoin and Ethereum. According to Assen Vassilev, the Bulgarian Finance Minister, the country could soon introduce a crypto payment mechanism. However, it should be noted that direct purchases of cryptocurrencies would not be possible for investors. The only options for making investments would be in the form of exchange-traded notes (ETNs) and exchange-traded commodities (ETCs).
Nonetheless, it was disclosed that even investing in these products would grant investors exposure to cryptocurrencies. According to the finance minister, investing in ETNs and ETCs could offer a lot of potential to Bulgarian investors. But, he did say that it was highly unlikely that Bulgaria would ever become a mining hub for digital assets. The stock exchange in Bulgaria already lists shares of a number of prominent global companies, such as Volkswagen, Pfizer, Apple and more. Now, Bulgaria is planning on listing products that belong to four different funds, which include WisdomTree, 21Shares, VanEck ETP and ETC Issuance.
But, investors do need to be attentive towards one thing. Not only do they have to monitor the exchange rate of the two leading cryptocurrencies in the market, they would also be subject to an annual fee of about 2% every year, which would be associated with BTC of ETC Issuance. The rules applicable to the crypto industry in Bulgaria are very simple. Local investors are not required to obtain a license when they want to delve into this particular asset class. However, it is important to note that a tax is applicable on cryptocurrencies like Bitcoin as well as altcoins, in the same way as income generated from other financial assets is taxable.
The Balkan country has become the world’s second-largest investor in Bitcoin. Back in 2017, reports indicated that the government in Bulgaria owns about 213,000 bitcoins, which have a value of about $804 million. Rumors indicate that these bitcoins had been seized during operations that were carried out against financial crimes and they confiscated cryptocurrencies from illegal miners. Ivan Geshev, the Chief Public officer denied any such seizure and stated that it wasn’t true, even though it had been confirmed by ‘Balkan Interpol’. No one paid much attention to this matter for a couple of years.
When a new government was established in Bulgaria, MP Ivaylo Marchev had reached out to Boiko Rashov, the Minister of Internal Affairs back then, in order to find out what had happened. However, the latter never responded to the former’s request for information. Ruja Ignatova, a Bulgarian entrepreneur, had tried to create a new cryptocurrency back in 2014 by name of Onecoin. But, as it turned out, it was nothing more than one of the biggest pyramid scheme in the recent decades. The project managed to attract 175 investors who invested a whopping $4 billion that was never to be seen again, along with the entrepreneur herself.