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Why You Should Start a Web3 Business in Portugal
Portugal has become a top choice for Web3 businesses in recent years. In fact, the nation's cryptocurrency revenue is likely to grow at an annual rate of 5.35% from 2024 to 2028, reaching $108.5 million by 2028. In addition, user penetration is expected to rise from 14.99% in 2024 to 17.09% by 2028. Along with these encouraging statistics, the nation's commitment to building a powerful technological ecosystem makes it an ideal destination for entrepreneurs seeking to grow in the Web3 space.
In this article, we discuss why starting a Web3 project in Portugal is a smart move and spotlight the increasing number of Web3 hubs, including the notable ICP Hub.
The Rise of Web3 Hubs in Portugal
Portugal's tech scene is buzzing with activity. Lisbon, the nation's capital, is the highest-ranked start-up ecosystem in Portugal. Many Web3 hubs are popping up across the country, offering exciting opportunities for collaboration and growth. These hubs act as knowledge centers, bringing together blockchain enthusiasts in a bid to advance blockchain technologies and decentralized applications.
The country is a hotspot for meetups, conferences, and events focused on blockchain, cryptocurrencies, and Web3. Being part of these communities, such as CryptoMondays and BasedInLisbon, can lead to valuable partnerships and investment opportunities.
One hub, in particular, ICP.Hub Portugal stands out by regularly hosting major events like hackathons, ideathons, and seminars, further energizing the tech scene. It was launched in Lisbon, ICP.Hub is more than just a physical space—it's an ecosystem designed to cultivate ideas and push forward the implementation of Web3 solutions. Led by Tim Haldorsson, the hub offers an environment where the brightest minds in blockchain and decentralized technologies converge. By providing a platform for networking and collaboration, the hub is proving instrumental in propelling the country's Web3 sector forward.
Alongside providing a hub for Web3 developers, ICP Hub Portugal has also emerged with an accelerator program, aiming to support builders through the lifecycle of their company. From hiring support to specialized mentorship from industry leaders, the accelerator is driving the adoption of Web3 technologies, specifically the Internet Computer Protocol.The birth of these hubs and communities has led to much wider developments, with conferences such as NFC Lisbon, and soon the Crypto AI:CON becoming beacons calling people from around the globe to the country.
A Favourable Regulatory Environment
Many have viewed Portugal as a crypto-friendly country primarily due to its initial lack of comprehensive tax regulations on cryptocurrency, which created opportunities for significant tax savings. However, this regulatory vacuum also led to legal uncertainty, as the absence of clear guidelines meant that any new regulations could suddenly impact existing business structures. Today, with more defined regulations in place, Portugal offers a more stable and predictable legal environment for setting up a crypto business, providing better grounds for long-term planning and investment. As prominent Portugal-based crypto lawyer Luiza Castro Rey puts it, Portugal offers a “unique blend of clear regulations, tax incentives, and institutional support that creates a stable and attractive ecosystem for digital asset investments”. She further comments that “For investors seeking a jurisdiction that not only welcomes their involvement but also provides a clear path for long-term growth and security”
In addition, the country’s Prime Minister Joaquim Miranda Sarmento recently told the Financial Times that his government would bring legislation to reintroduce tax breaks to bring even more investors and entrepreneurs in the Web3 space to Portugal.
The Banco de Portugal (BdP) is in charge of regulating wallet providers and cryptocurrency exchanges, aka Virtual Asset Service Providers (VASPs), to make sure they abide by AML and CFT laws, to guarantee the security and transparency of transactions.
For users looking to acquire, hold, or sell crypto assets in Portugal, there are generally no specific limitations or license requirements, except in cases where these assets are classified as securities. Regarding cryptocurrency mining, Portugal does not impose any restrictions on the growth or practice of mining activities.
A significant role is also played by the Portuguese Securities Market Commission (CMVM), which oversees crypto assets that meet the criteria for financial instruments and conventional consulting and management services. Advisory services and sole administration of crypto-asset portfolios are exempt from securities-related laws and regulations, provided the assets are not considered financial instruments.
Access to Talent and Resources
Portugal boasts a thriving tech ecosystem with a wealth of skilled professionals. The country's universities and research institutions produce a steady stream of talented graduates in fields like blockchain development, smart contracts, and decentralised applications. This rich talent pool is a significant asset for Web3 start-ups seeking to build strong teams and drive innovation.
Moreover, the presence of Web3 hubs like ICP.Hub enhances access to resources and expertise. These hubs provide essential support through mentorship programs, educational workshops, and networking events, helping start-ups to grow. The collaborative environment encourages the exchange of ideas and best practices, creating a culture of continuous learning.
EU Location and Connectivity
Portugal's geographical location makes it an attractive base for Web3 businesses. Situated at the crossroads of Europe, Africa, and the Americas, Portugal offers excellent connectivity to major markets. This geographic advantage facilitates international collaborations and market expansion, providing start-ups with opportunities to scale their operations globally.
Additionally, Portugal's membership in the European Union grants access to a large and harmonised market. The EU's single market allows businesses to operate across member states with minimal regulatory hurdles, further enhancing the growth prospects for Web3 ventures based in Portugal.
Government and Industry Support
The Portuguese government has shown a strong commitment to digital transformation. Initiatives like Web3 Hub and others provide valuable support to start-ups, offering incubation and scaling programs. These initiatives are designed to support entrepreneurs through the challenges of building and growing a business, providing access to funding and mentorship.
Portugal is a Top Choice for Web3 Entrepreneurs
Portugal is an excellent option for launching a Web3 business. With its booming tech scene, rich talent pool, and convenient EU location, the country is well-positioned to become a global leader in the Web3 space.
The presence of hubs like ICP.Hub Portugal, with government initiatives and a collaborative community, creates an ecosystem ripe for growth. For entrepreneurs looking to make their mark in the Web3 world, Portugal is well worth consideration.
