Can I hold and trade crypto in Cyprus?
Yes — holding and trading crypto is legal. Crypto-asset service providers (exchanges, custodians) are supervised by CySEC and must be authorised under MiCA (EU Reg. 2023/1114). In transition, already-registered providers may continue until 1 July 2026 or until their MiCA authorisation is decided. Gains must be declared on the tax return. The 2026 tax reform reports a flat 8% on individuals' trading gains and a 15% corporate rate from 1 Jan 2026. Note: the 8% comes from reform reporting and is not confirmed as final law. In short: yes, legal, with gains declared.
📋 The rules
- Holding/trading crypto: legal
- Providers: CySEC supervision + MiCA licence
- MiCA transition: until 1 July 2026
- Gains: declared on the tax return
- Reported flat 8% (unverified)
🔓 Exceptions
- Crypto losses offset only same-year crypto gains (no carry-forward)
- Mining income: taxed under general income-tax rules
- The flat 8% is pending final text
⚠️ Penalties & fines
Not declaring gains from crypto is tax evasion, with additional tax, interest and fines. Providing crypto-asset services without a MiCA licence after the transition is a supervisory breach. Beware a myth: "crypto gains are anonymous and tax-free" is false — they must be declared and are taxable (a flat 8% is reported, pending confirmation). Tip: keep transaction records and declare gains; confirm the rate with the Tax Department.
📎 Official sources
❓ Frequently asked
Is crypto legal in Cyprus?
Yes. Holding and trading cryptocurrency is legal. Crypto-asset service providers, such as exchanges and custodians, are supervised by CySEC and must be authorised under the EU's MiCA regulation, with which Cyprus is fully aligned, sharing competence with the Central Bank.
Do I pay tax on gains?
Gains from crypto are taxable and must be declared on your annual tax return. The 2026 tax reform reports a flat 8% rate on individuals' trading gains, but this hasn't been confirmed as final enacted law, so the exact treatment should be checked with the Tax Department.
What about losses?
According to reform reporting, crypto losses offset only same-year crypto gains and don't carry forward to later years. Mining income is taxed under the general income-tax rules, outside the flat regime. Keep records to support how you treat gains and losses.
Does an exchange need a licence?
Yes. Crypto-asset service providers must be authorised under MiCA. Those already registered may continue under transition until 1 July 2026 or until their MiCA authorisation is granted or refused, after which a full MiCA licence is required to keep operating.
Do I have to declare my crypto?
Yes. Gains must be reported on the tax return. They're neither anonymous nor tax-free. Keep a detailed record of your transactions and confirm the applicable rate and rules with the Tax Department, since the reported flat 8% rate is still pending final confirmation.
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