Crypto in Italy

Italy established its cryptocurrency regulatory framework through Legislative Decree No. 90/2017, which implemented the EU's Fourth Anti-Money Laundering Directive. The Bank of Italy and CONSOB (Commissione Nazionale per le Società e la Borsa) share regulatory oversight. The Bank of Italy supervises virtual currency service providers for AML/CFT compliance under Legislative Decree No. 231/2007, requiring registration with the Organismo Agenti e Mediatori (OAM). CONSOB regulates crypto-assets qualifying as financial instruments under the Consolidated Law on Finance (TUF). In 2022, Italy implemented the EU's Markets in Crypto-Assets Regulation (MiCA) framework through national decrees, establishing comprehensive rules for crypto-asset service providers (CASPs). The Ministry of Economy and Finance issued Decree No. 148/2022 defining supervisory powers and administrative sanctions for MiCA violations. Italy's regulatory approach remains conservative, prioritizing investor protection and financial stability over innovation promotion.

Italy imposes a 26% capital gains tax on cryptocurrency profits under Article 67 of the Presidential Decree No. 917/1986 (TUIR). The tax applies to gains exceeding €2,000 per tax year from transactions conducted through Italian-resident intermediaries. For transactions through non-Italian platforms, taxpayers must self-report using the RW form in their annual tax return. Mining income and staking rewards are taxed as miscellaneous income at progressive rates up to 43%, plus regional and municipal taxes. In December 2023, the Italian government proposed increasing the capital gains tax to 42% as part of the 2024 budget law, but withdrew the measure following industry protests. VAT does not apply to cryptocurrency exchanges under the EU Court of Justice's 2015 Hedqvist decision. The Italian Revenue Agency clarified in Resolution No. 72/2016 that cryptocurrency qualifies as a foreign currency for tax purposes.

Italy has approximately 1.3 million cryptocurrency users according to 2023 data from Triple-A, representing 2.2% of the population. The Bank of Italy's 2022 Report on Financial Investments of Italian Households revealed that 2% of Italian families hold crypto-assets, with average holdings of €13,000. Institutional adoption remains limited, with only 12 VASPs registered with OAM as of March 2024. Major exchanges including Binance, Coinbase, and Crypto.com operate with Italian registrations. The Italian Banking Association (ABI) launched the Spunta project in 2020, testing blockchain for interbank reconciliations. In 2021, Banca Generali partnered with Conio to offer Bitcoin custody services to wealth management clients. Retail use cases dominate, with 78% of crypto transactions involving Bitcoin and Ethereum according to CONSOB's 2023 market analysis.