In March 2015, the Bank of Portugal asked all banks and other monetary institutions to withdraw from trading with crypto currencies due to risks associated with schemes based on which they work. 

This risk is a result of greater anonymity of salespersons trading with crypto currencies and non-transparent crypto currency transactions between the traders, or specific crypto markets, as well as of insufficient regulation of this environment. The Bank of Portugal and the Portuguese Securities Market Commission (Comissáo do Mercado de Valores Mobilárions or CMVM), as state bodies, define the concept of crypto currency as a virtual expression of value that is not issued by the central bank, credit institution, nor e- banking institution. Thus, their view is in line with the view of the European Central Bank. 

Despite the said call, trading with crypto currencies is not forbidden in Portugal. And so, investors may buy, keep and sell the crypto currencies. And as there is no special judicial provision regarding crypto currencies, Portuguese Tax and Customs Authority (Autoridade Tributária e Aduaneira) issued two interpretative regulations concerning this type of digital gold. The first one defines the topic of income tax (cf. Autoridade Tributária e Aduaneira , the binding information provided in the proceedings no. 5717/2015 of 27 December 2016) and the second one the topic of VAT (Cf. Autoridade Tributária e Aduaneira, , the binding information provided in the proceedings no 12904 of 15 February 2018).

The interpretation of income tax implies that the profit of a natural person resulting from crypto currency evaluation is not subject to income tax. However appealing it may sound for prospective investors who have been lured by the vision of non-taxable profit, it might be somewhat disappointing to discover that the said does not apply to recurrent, regular activities of respective natural persons, and neither does tax exclusion apply to legal entities or enterprises. It is also vital to emphasize that interpretation does not cover the topic of cryptomining, so the question of subjecting cryptomining to taxation remains open. 

The second interpretation clarifies VAT-related questions and suggests that crypto currency is not subject to VAT. The Portuguese Tax and Customs Authority understands a crypto currency as a means of exchange, does not consider it goods, and identifies with the precedence of The European Court of Justice (Case C-264/14, Skatteverket v. David Hedqvist) wherein this legal view has been established. 

Although a certain form of a legal vacuum might seem to have emerged, the application of laws differs case by case. A crucial criterion appears to be a division of tokens into two groups, i.e. security and utility tokens. Security tokens present their holders with a right to a corporate profit or other types of gains, e.g. interests from a token issuer, which at least in terms of the content, meets the definition of a security. The second category of utility tokens relates to acquisition of service rights or other benefits of its holder. The Securities Market Commission agrees with an opinion that a utility token cannot be considered a security or a financial tool while emphasizing that in particular cases, and based on an individual judgment, a security token can be a security or a financial tool.

It can be concluded that in spite of the fact that crypto currencies are not defined as money or electronic money, they are perceived as an alternative payment method of legally binding nature arising out of a mutual agreement concluded between parties in question. Such agreement bears inherent characteristics duplicating key features of traditional money, i.e. crypto currency is considered as a store value, unit of account, and an exchange means. Sooner or later, this will also have to be reflected accordingly by the legislation that should introduce transparent rules concerning, among other things, the definition of crypto currencies and their respective tax policy.