Trade options on Deribit

I recently wrote an in-depth guide on Bitcoin futures – where I explained that they meet the needs of a certain type of investor that wishes to place sophisticated trades. You do, of course, also have Bitcoin options – which is beginning to pick up ground in the cryptocurrency scene.

Make no mistake about it – options are even more financially complex than futures. But, once you get your head around how they work, they can be a great way to place low-risk, high-reward trades. Put simply, this is because with options – the most you can lose is the ‘premium’ that you pay to access the market.

In this guide, I am going to explain everything there is to know about Bitcoin options. I’ll discuss the specifics of how this trading scene works. Including, how they allow you to make money, the risks involved, and how you can start trading Bitcoin options today.

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Portugal is fast becoming the number one country for anyone involved in crypto, especially long-term investors and retail traders. Official statistics clearly show that immigration to Portugal is growing a lot year after year, and a good chunk of these expats are young people below the age of 40.

Buy Bitcoin

Since writing the original version of the article, I’ve personally received a ton of emails from people who have moved to Portugal or are in the process of moving so, with a lot of these people having some involvement in crypto. I think this is extremely exciting for the crypto scene in Portugal and the country in general. Becoming a haven for people involved in this new revolutionary technology can only bring positive effects to Portugal and its citizens.

People involved in crypto tend to be forward-looking and risk-tolerant, and they are also likely to have made some good gains and now amass a healthy net worth. This means that they will be spending more money in the local economy, as well as inspiring the people around them to learn more about finance and investments. They will also probably want to diversify their investments, and I bet that we will be seeing a lot of these people starting new businesses in Portugal. I expect to see more modern cafes, international restaurants, and startups, all fueled by the new expats.

See also: The Best Crypto Trading Apps

For those of you who have never visited Portugal, here’s some background.

Portugal is a member of the European Union and sits right on the Western edge of Europe, bordering Spain. Its climate is generally similar to Spain but it sits on the Atlantic coast, which means that its seas are wavier and colder, which makes it a surfers’ paradise.

The population sits at around 10 million, healthcare is ranked among the best worldwide, the local population is considered to be very friendly and one can feel safe in the streets. There are very low levels of crime. One should consider that Portugal has gone through a very tough period in the past twenty years as it didn’t perform well economically. This led many of its younger people to leave and seek better conditions abroad. The NHR program is actually a countermeasure to try and restore things by making the country once again very attractive to expats and Portuguese who had emigrated years ago.

The NHR programme and a host of other related laws are now having the desired effect, and are a great example of how a country can pick itself up from the ashes and thrive against the odds by supporting freedom and innovation.

Portugal is one of the few countries that is forward-looking and is encouraging the immigration of high-net-worth individuals, investors, and entrepreneurs. This will result in these people having a positive effect in the local economy by spending their money within Portugal. Not only that, they will bring new and bright ideas, and will start new businesses in the country.

See also: Lisbon vs Barcelona

This attitude is in stark contrast to the neighboring country, Spain, which has gone out of its way to punish local and foreign entrepreneurs who want to start new businesses and help the economy. It’s a real pity to see the political situation in Spain at the moment, but hopefully, the politicians will eventually see that the Portuguese model works better and switch course.

The big attraction of Portugal, apart from its beautiful cities, nature and friendly English-speaking (for the most part) population, is the NHR programme. If you qualify for the NHR, you can get foreign dividends tax-free, and there are also allowances for specific types of professions/jobs that can also get their foreign income at 0% tax.

Requirements for NHR

You don’t have to live in Portugal during the whole year to be an NHR. The NHR (non-habitual resident) program, allows citizens from is attractive to professionals, pensioners, investors and entrepreneurs who want to enjoy a life free of income tax. The government of Portugal offers tax benefits to everyone, with a unique advantage: no minimum stay requirement in the country.

You only have to meet one of the following requirements:

• Stay for a minimum of 183 days in the country, whether interrupted or continuous
• Have a house available and have “intention” to live there
• Be a member of a Portuguese ship or aircraft crew
• Have a spouse or children in the country
• Be employed overseas by the Portuguese state

How Crypto Tax Works in Portugal

The crypto space is getting more and more complex over time with the introduction of staking, lending, DeFi, NFTs etc, and each of those needs to be considered carefully. Investors are no longer solely interested in simply buying and trading the big cryptos (Bitcoin, Ethereum etc.) I will keep expanding the information below based on my own research and discussions with Portuguese tax experts.

For now, let’s start with the treatment of crypto sales, which is what the majority of investors are interested in. Basically, we need to understand how the profit on sale of crypto is treated in Portugal. In most countries, this is treated as capital gains and taxed accordingly. What about Portugal?

Simply said, pre-2023, crypto trading in most cases was tax-free due to a loophole in the tax system. As from 2023, crypto trading gains will be taxed at 28%.

While crypto trading is no longer tax-free, one can still use the NHR programme to create a very advantageous structure and lower the overall level of worldwide tax suffered. Read my article on European tax structures for more information on that.

Inheritance Taxes

There is no precedent, specific rules or particular approach regarding the treatment of cryptocurrencies for the purposes of estate planning and testamentary succession in Portugal.

Notwithstanding, certain aspects of estate planning and testamentary succession should be highlighted.  Inheritance tax does not exist in Portugal, but stamp duty may apply to certain transfers of certain assets (e.g. immovable property, movable assets, securities and negotiable instruments, provided they are located, or deemed to be located, in Portugal) included in the deceased’s estate in case of succession.

However, in the absence of a legal amendment or binding information from the Portuguese tax authorities, it may be argued that the drafting of the relevant legal provisions does not expressly foresee assets such as cryptocurrencies, thus excluding the same from the scope of application of stamp duty, which de facto mitigates the need for estate planning with respect to cryptocurrencies.  Estate planning and testamentary succession must therefore be analysed on a case-by-case basis, considering all variables involved.

VAT

In a 2019 official ruling, the Portuguese Tax Authority confirmed the precedent from the Court of Justice of the European Union (Case C-264/14, Skatteverket v. David Hedqvist) to argue that although cryptocurrencies such as Bitcoin were analogous to a “means of payment” and therefore subject to VAT, they were exempt by application of VAT exemption rules, which should be consistent across EU Member States considering existing VAT EU harmonization.

Get in touch with a Portuguese crypto tax lawyer

How to Buy Bitcoin in Portugal

You can use the world’s best crypto exchanges in Portugal without any problem, there are no limitations imposed by the country or by any of the big exchanges.

My suggestions would be to use any of the following:

• Binance (see my review)
• Coinbase (see my review)
• Bitpanda (see my review)

You can also use crypto borrowing and lending platforms such as Nexo and YouHodler without any problems.

Keep in mind that you will still need to keep good track of your crypto trading activity even though it might be tax-free. I suggest you use a tool like Cointracker for that. Check the other options in my article about crypto portfolio and tax preparation tools.

Crypto-Friendly Banks in Portugal

Please leave a comment if you have found a suitable crypto-friendly bank in Portugal. You can also have a look at the best European crypto debit cards that work in Portugal.

Buying Property with Crypto

Some real estate sales in Portugal have already been done using crypto. The most famous case is this one. I expect this to become more commonplace given the number of crypto people moving to Portugal.

Contact me if you want to buy property with crypto; I’ll put you in touch with my agent.

Golden Visa Investments

If you’re looking for good golden visa-related investments, I can put you in touch with a fund that invests within Portugal, and with an architecture firm that creates homes targeted directly towards satisfying the requirements of getting a Golden Visa. Just get in touch and I’ll put you through.

Participating in the Portuguese Crypto Community

You can follow this Twitter list that features many of the big crypto players that are based in Portugal. Please let me know about other crypto players and communities in Portugal by leaving a comment below or by contacting me.

Hard Fork Cafe is a cool YouTube channel dedicated to crypto, although you need to understand Portuguese for that. It’s a good way to practice learning the language though if you want to hit two birds with one stone.

Futures operate in a multi-trillion dollar industry. They are complex financial instruments that allow you to speculate on whether the price of an asset will be higher or lower in the future.

While futures are particularly common when trading commodities like gold, oil, and wheat – they have since reached the Bitcoin scene. Whether or not you should access Bitcoin futures will depend on your financial goals, understanding of the market, and how much risk you seek to take.

See also: Best Exchanges for Spot Trading Crypto

To help clear the mist, this guide will tell you everything you need to know about Bitcoin futures. I’ll explain how this segment of the crypto investment scene works, what potential risks and rewards you need to consider, and how you can get started with a Bitcoin futures trade today.

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Recently, I’ve been discussing the Europe-based FinTech platform YouHodler a lot on here. For readers of those articles, you probably noticed as strange new terms appear frequently.

One of those terms is “Multi HODL” and at first glance, it may not mean much to you but as we peel back the layers behind this tool, you’ll begin to understand why automated margin trading should have a place in every crypto trader’s trading strategy.

So let’s get started, but first, the basics.

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Once you buy Bitcoin, Ethereum, or any other cryptoasset, you’re definitely not done yet. The hard part is what comes next – deciding how to custody your cryptoassets.

If you own a significant amount of crypto, the biggest problem you need to solve is how to solve it securely. Having your own cold storage devices is fine for some, but others want third-party solutions that are even more bulletproof, although there is also the trusted third-party risk to consider.

The web is full of horror stories of people who got their cryptos stolen, or just misplaced the information necessary to access their holdings.

The challenge of custody remains, in my opinion, one of the biggest impediments to the mainstream adoption of Bitcoin.

On the other hand, several companies have been working on coming up with a solution for the custody challenge.

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