The world today is a new place with many alternative sources of revenue. Well, who doesn’t like the concept of easy money? Cryptocurrencies due to their high-profit margins are very popular. However, there are still some countries that have difficulty wrapping their heads around this notion. We present the top 10 countries where crypto is illegal.
The ban on crypto prevails in many economies around the globe. Though a legal structure has been set up in other big economies to fight the cons of crypto, there are still many countries that are not ready to bring the change desired for smooth and proper functioning. There are plenty of reasons that make it illegal, some of them are listed below:
- Welcomes Black Money
Cryptocurrency markets are not regulated like the markets of equity or commodity. The information of buyer and sellers are confidential thus arising the problem of selling and purchasing coins without the knowledge of the buyer or the seller. It is easy for the seller of contraband to sell the coins as their identity remains anonymous.
Also if your wit suggests that they could be tracked by the device, it is again a hurdle as the seller can change their address with every transaction.
- Spin the bottle, it’s the launderer’s chance!
Money laundering is the obvious consequence of cryptocurrencies. All the illegal money can be passed into crypto with the addition of gaining profits and even if they lose some, who cares, it wasn’t theirs in the first go. Due to the advantage of the change in address with every transaction, a launderer can buy crypto in divided portions. Thus, leaving no loophole to be caught with a naked eye.
Apart from these two, tax evasion is also a propagated reason. Therefore, there are many countries that don’t want to add a burden on their economies all the way more than they are already facing.
If you are planning for any of these countries to invest your sum, don’t!
Without much ado, the following are the top 10 countries where cryptocurrencies are illegal.
One of the top economies of the world with a total GDP of $17 trillion bans the use of cryptocurrency in 2021 along with many other bans that the economy is already gripped by. When asked, if there is a probability of lifting the bans China was strong-headed with the belief that crypto mining harms the environment and promotes money laundering. The ban was put upon in a phasing manner. China’s government first asked the financial institutions not to get engaged in any transaction involving cryptos. The second phase was when it disallowed all the domestic mining agencies from operating and ultimately shut down the entire market by illegalizing it.
China’s current plan is similar to India’s which is to promote its digital domestic currency Yuan and make it available to domestic users.
Supervision and Control of Financial Institution Division under the central bank of Qatar issued a notice to all the financial institutions operating in the domestic territory of Qatar to stop the trading of digital cryptocurrencies effective immediately. This happened in 2018 when the governor of Qatar’s Central bank put into effect new executive regulations. This was done so in order to curb money laundering issues and also to combat terrorist financing which has gripped the economy already.
In 2020, Turkey was the fourth largest country to be involved in cryptocurrency trading. This was mainly because of the high inflation, which was a very popular subject of discussion in 2021, and the plunging domestic currency the country was experiencing. Thus, the result was the collapse of whole cryptocurrency market exchanges and the founders of same were alleged of frauds.
This made the way for a new implementation of laws in April 2021 leading to a partial ban on the cryptocurrency exchanges. Within these bans, crypto was prohibited from being used in day-to-day transactions. Although it is still a legalized Turkish government asset and all the agencies delving into mining and stuff revolving around crypto are regulated to some extent so as to have a customer identification made compulsory.
A long-driven discussion took place in Russia on the legal status of cryptocurrency. When the bank of Russia filed a proposal for banning cryptocurrency mining and trading giving the reason that these digital currencies pose threats to the financial system of the economy.
However, the finance ministry’s thought was different and this led to a feud of thoughts due to which decision pertaining to the legal status got stranded in a desert with no conclusion. Thus, currently, crypto is banned from day-to-day payment methods but its legal status still prevails in the country.
In 2016, the central bank of North Macedonia issued a notice prohibiting all the cryptocurrency transactions in the country. It was more of a warning or a reminder that the bank account of Macedonian are still in control of the national bank.
Bitcoin along with other cryptos were banned from trading and thus can’t be traded as their international bank account is under the control of the Macedonian national bank.
It is also interesting to note that it is the only European nation where cryptocurrency is banned in a total sense, i.e spending, investing, and trading everything is completely banned.
Our very own neighboring country has a different approach when it comes to cryptos. Digital assets of any kind are cleared to be banned by Bangladesh central bank in 2017. There exist a complete ban on them though it is not criminalized.
The payments through digital assets are prohibited under the three acts including the money laundering act, the anti-terrorism act, and the foreign exchange regulation act. However, trading outside the realm of government and central authorities is allowed.
Therefore, ownership, keeping, and trading are banned by the Bangladesh central bank due to the decentralized structure of Bangladeshi invest in.
The primary Islamic legislator Dar al-Ifta of Egypt issued a notice stating any transaction done through cryptocurrency is haram that is not acceptable by the government or as a source of trading. Only the paper currency is an acceptable form of money.
Egypt is very strict with its policy of investing, promoting issuing, or trading digital assets of cryptocurrency. It is also prohibited to make a platform that functions in the same alignment as the crypto platform works. According to the legislator, these currencies pose serious threats to the financial stability and security of the economy
However, in 2020 various changes were brought about in transforming the digital banking system of Egypt that gave various digital assets an inclusion in the finance sector. This transformation gave the definition and legalized status
It is legally banned in Morocco to trade cryptocurrency. However, a local crypto platform called localbitcoin, which is a trading platform saw a 215% surge in Feb 2021.
More than 70% of locals of Morocco do not own bank accounts with the government, as shown by world bank research thus facilitating the process of trading in bitcoin in the country where the legal status of crypto is yet to be stated.
The reason stated by the Moroccan government for the ban on crypto is still a little abstract to understand. They assert the fact that they are willing to have space to understand the regulation needed and by that time, until the legal body is set up to understand the working and combat the risk associated with these digital assets, the ban will not be lifted.
The Iraqi government issued a public notice in 2017 that moves along the lines of money laundering acts set up by the nation’s constitution body. The notice says if anybody gets caught trading the cryptocurrencies or using them for the trading purpose, he/she will be penalized with the sum cited in the money laundering act.
The central bank of Nepal called the Nepal Rastra Bank endowed with the directive that resulted in a complete ban of cryptocurrency to be traded or be invested in any form by the citizens of Nepal along with foreigners residing in Nepal itself Nepalese staying abroad.
The reason stated by the bank was it poses threats and risks for the traders involved in investment.
There are 40+ countries around the globe that still has to go a long way in order to legalize the use of cryptocurrency. The world is evolving, and many alternative sources of revenue are emerging however people adjust with their pace.
Every country faces different threat and work with different ideologies. There exist partial and complete banning. Partial banning includes the trade of crypto, however with the prohibition of mining. Mining is proven to have an adverse effect on the environment, hence applause for all our nature-loving countries.
If you don’t belong to these countries, then invest in cryptos after reading all the terms and conditions prevailing in yours. As for India, the only highlight which every Indian remember is a 30% on trade of cryptocurrencies.
edited and proofread by nikita sharma