Cryptocurrencies have taken the world by storm, but it’s not every country has adopted them with open arms. Although cryptocurrencies are legal in most countries, some countries have outright banned them, while others have taken more of a wait-and-see approach with respect to their adoption or use in their countries. This article will take you through the most notable countries that have banned cryptocurrencies, why they’ve done so, and what you can do if you’re living in one of these areas.
After banning ICOs, China has gone a step further and decided to ban all crypto trading (and possibly mining as well). The move is, for now, only in effect in Beijing and Shanghai — but we imagine it won’t be long before it spreads across China. This isn’t too surprising given that China had already cracked down on Bitcoin miners by reducing electricity subsidies. On Sept 4th of 2017 it was reported that Chinese authorities had ordered local cryptocurrency exchanges to stop trading and immediately notify users of their closure – an event now referred to as China’s Great Bitcoin Ban. Since then exchanges such as Huobi and OKCoin have not been allowed to resume operations.
Bolivia has taken a hard stance against cryptocurrency, proclaiming it illegal and punishable by up to 12 years in prison. It’s important to note that cryptocurrencies were still in their infancy when Bolivia passed its ban in 2014. Since then, though, cryptocurrencies have become much more popular and widespread. The same can’t be said for Bolivia, however; cryptocurrency is extremely uncommon there today.
The country banned cryptocurrencies earlier in 2018. Cryptocurrencies, due to their characteristics, are risky and unstable means of payment, which are not issued or guaranteed by any monetary authority, said Ecuador’s government on its official website. They are not legal tender currency that can be used as a medium of payment of debts nor may banks, financial institutions or any authorized operator conduct operations with virtual currency. So far no action has been taken against users of cryptocurrency. Those who violate the ban will be fined up to nearly $2 million per incident and up to 10 years in prison.
The Central Bank of Ecuador officially banned Bitcoin in 2014. The bank issued a statement on its website which said, Bitcoin is neither money nor electronic money…It is not authorized by any monetary authority. Ecuador followed up with a decree which stated that transacting with Bitcoin was punishable by prison time. More recently, President Lenin Moreno stated that his government was open to creating their own digital currency—though it’s unclear whether or not that means there will be an end to Bitcoin’s ban in Ecuador. For now, though, Ecuadorian citizens are forbidden from using Bitcoin as legal tender within their country.
Bangladesh’s central bank recently issued a statement saying it had not given any license/authorization to any entity/company to operate such schemes or deal with Bitcoin or any virtual currency. It went on to warn citizens about their risks and concerns, and then concluded: Bitcoin is not a legal tender of any country. Any transaction through Bitcoin or any other cryptocurrency is a punishable offense. Even though Bangladesh hasn’t legalized cryptocurrencies, there’s no indication that its government plans to put an end to them anytime soon.
The South Asian country in 2015 became one of the first to ban cryptocurrencies. Bangladesh Bank, its central bank, issued a statement at that time warning about the possibility of financial scams/internet frauds with virtual currencies. We know it has become a habit for criminals to carry out their activities using bitcoins, police chief Shahidul Hoque told Agence France-Presse (AFP) at that time. Iceland: The northern European island nation was among several countries in which cryptocurrency trading saw massive growth last year.
The country’s National Bank has released a statement to citizens about virtual currencies, warning them that any transactions and income received through cryptocurrencies will be taxed by 20%. They also state: Any foreign currency operations without a special permit from authorized banks in Kyrgyzstan is illegal. This appears to refer to trading in cryptocurrency, rather than using it as an actual payment method. It is unclear whether there are plans to outright ban cryptocurrency usage. Additionally, it is worth noting that many countries around Central Asia have been embracing blockchain technology and even plan on issuing national coins or launching national crypto tokens. For example, Kazakhstan recently introduced a crypto token called Zhantor, while Uzbekistan has partnered with Waves Platform for a blockchain-based voting system.
Morocco doesn’t have any official regulations on cryptocurrency, but citizens are restricted from using virtual currencies for money laundering purposes. Money laundering is criminalized under Morocco’s Code d’Instruction Criminelle, or Criminal Instruction Code. Individuals that facilitate or attempt to launder money are subject to Morocco’s tough penalties for corruption. A person found guilty of money laundering can be punished with a prison sentence ranging anywhere from six months to five years. On top of that, they could face fines between MAD 10,000 and MAD 200,000 (USD 1,020 to USD 20,200), as well as confiscation of any real property involved in an offense. And if it happens more than once? Well…you get where we’re going with that one…
Nepal has banned any kind of trade in cryptocurrencies. This means that it is illegal to buy, sell or hold crypto in Nepal. Those who are caught doing so can face fines and possible jail time under anti-money laundering laws. The ban was issued by Nepal’s central bank, but its reasons for issuing it were not disclosed. It appears that Nepal does not want to risk becoming a hub for cryptocurrency activity like some other countries have done, like Japan and Singapore for example.
Bitcoin has been banned in Nigeria because of its high risks for investors and users, Central Bank Governor Godwin Emefiele said on Thursday. Bitcoin is also used to facilitate trade in pornography, drugs and weapons, says Adebayo Nwaosu, a financial analyst at Excel Securities Ltd. I don’t think we should just outright ban them, he said. We should start by educating people about it and telling them that if they invest in such currencies they will lose all their money.