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Where Is Bitcoin Illegal?

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Bitcoin and other cryptocurrencies are gaining popularity around the world. But even despite rising numbers of crypto traders across the globe, there are still counties that ban cryptocurrencies.

Where is Bitcoin illegal, you might ask?

The following countries have bans on ALL forms of cryptocurrency transactions (from trading to mining):

There are more countries out there that have restrictions on cryptocurrencies, but these bans are limited in scope. For example, some countries only ban crypto mining while others don’t allow exchanges to operate in their territory.

With that in mind, here’s everything you need to know about where Bitcoin is banned around the world.

11 Places Where Bitcoin is Banned

1. China

Of all the countries where Bitcoin is illegal, China is arguably the most well-known example.

China made all cryptocurrency-related transactions and business activities illegal in 2021. Technically, Bitcoin itself was made illegal in China in 2013 and crypto trading was banned in 2019. But the Chinese government didn’t start cracking down on these activities in earnest until 2021.

Punishments for trading or transacting in Bitcoin and other cryptocurrencies in China can vary.

Fundraising in the country using crypto, such as through initial coin offerings (ICOs) can land you in prison for up to 10 years. News outlets outside of China haven’t done a lot of reporting on arrests in the country for crypto-related activity, either. But China did arrest over 1,100 people in 2021 over suspected money laundering practices that involved cryptocurrencies.

It’s worth mentioning that, while the government of China bans all cryptocurrencies, it’s also in the process of creating its own central bank digital currency (CBDC) called the e-CNY. The e-CNY is still in development and there’s no word yet on when it will be publicly available.

2. Algeria

Algeria banned Bitcoin and all other cryptocurrencies back in 2018 as part of its annual Finance Act.

In Algeria, it’s also illegal for banks to handle or use cryptocurrency. Crypto exchanges also aren’t allowed to operate in Algeria, which is one of the reasons why Algeria is excluded from most exchanges’ lists of supported countries.

In other words, Algeria’s ban on crypto extends to all businesses and individuals. There haven’t been many reports on arrests or punishments for people dealing in crypto within Algeria, but all digital currency transactions are banned in the country.

3. Bangladesh

Bitcoin and other cryptocurrencies are technically illegal in Bangladesh.

Bangladesh first warned citizens, residents, and businesses that crypto transactions might violate national laws surrounding money laundering back in 2012. But the country didn’t ban crypto outright until 2017.

Unlike some other countries where Bitcoin is illegal, Bangladesh seems to be quite active in arresting anyone involved with crypto. The country arrested four people on crypto trading charges in 2021 and another two people for Bitcoin trading in 2022.

4. Bolivia

Crypto-related legislation in Bolivia is in a state of flux. Bolivia didn’t have an official ban on Bitcoin until early 2022 when the Bolivian Central Bank prohibited crypto-related transactions in the banking sector.

The law doesn’t technically talk about crypto use among private citizens, but the Bolivian government’s approach to Bitcoin in the past has been nothing short of hostile.

In 2014, Bolivia’s central bank said that it considers all cryptocurrencies to be “pyramid schemes”. Authorities at the time said that any kind of currency that’s not controlled and issued by a central government or another authorised entity is illegal. This wording doesn’t specifically address cryptocurrencies, but it clearly targets them.

Plus, in 2017, Bolivian authorities even arrested 60 people on pyramid scheme charges for promoting cryptocurrencies and teaching people how to invest in Bitcoin.

5. Egypt

Egypt officially banned crypto trading, issuance, and promotion in 2020. The government’s reasoning behind the ban was that crypto is highly volatile and speculative. As a result of the ban, only fiat currencies that are approved by the Central Bank of Egypt are legal in the country.

When it comes to enforcing this ban, authorities in Egypt have only made a few high-profile arrests.

In 2022, security authorities in the country arrested three people on fraud charges related to the promotion of a decentralised gaming app where users could earn crypto. Since these charges are fraud-related and not crypto-specific, the punishment for them can vary – but it normally involves prison time.

6. Iraq

Iraq officially banned cryptocurrencies in 2017 according to a statement from the country’s central bank.

According to the US Law Library of Congress, penalties for trading or dealing with cryptocurrencies in Iraq are levied based on the country’s anti-money laundering laws.

There haven’t been many news stories about crypto-related arrests in Iraq in English language media outlets. But the country has a total ban on crypto and it may have made arrests that Western media isn’t reporting on.

7. Morocco

All crypto transactions are illegal in Morocco. The government of Morocco made crypto and all other forms of “virtual money” illegal in a 2017 press release. According to the press release, all transactions using virtual money are a violation of currency exchange regulations.

Morocco seems keen to enforce its ban on Bitcoin. For example, in 2019, the Moroccan government arrested a Palestinian national residing in the country for trading virtual currencies (though it’s worth noting that this individual was also trading crypto on behalf of terrorist organisations, which makes it a relatively unique situation).

8. Nepal

All cryptocurrencies and all cryptocurrency transactions in Nepal are illegal. The Nepal Rastra Bank (NRB), the country’s central bank, formally issued the ban in 2022 after months of chatter about its plans to limit digital assets in the region.

Nepal’s crypto ban is particularly interesting for two reasons.

First, the law bans both Nepali nationals and non-nationals in the country from transacting in crypto. But it takes things a step further by banning Nepalis from using crypto regardless of where they live.

While Nepal’s ban on crypto in the country is on par with other countries’ prohibitions on digital assets, its restrictions on Nepalis abroad are unique. It’s unclear how Nepali officials might enforce this ban for Nepalis living permanently overseas, but it raises some interesting questions on the scope of these laws.

Nevertheless, Nepali officials have already started arresting people for trading cryptocurrency in the country. In early 2022, not long after enacting the law, officials in the country arrested three people on charges of trading crypto.

9. Qatar

The government of Qatar formally banned Bitcoin and other cryptocurrencies in 2018. Qatar’s central bank issued a statement in 2018 where it said that “Bitcoin is illegal and not issued against liability from a central bank”.

Additionally, Qatar’s central bank prohibits banks from dealing with cryptocurrencies or from supporting transactions related to cryptoassets. Crypto exchanges are also illegal in the country on the grounds of combating money laundering and terrorism.

There haven’t been many media articles from Western news outlets about arrests in Qatar on crypto charges. But the Qatari government views crypto transactions as money laundering and terrorist financing activities, so punishments for handing Bitcoin in the country can vary widely.

10. Saudi Arabia

Saudi Arabia made Bitcoin and other cryptocurrencies illegal in 2018. According to the Saudi Central Bank, cryptocurrencies are unauthorised securities in the foreign exchange (forex) market, so they’re illegal in the country.

The Saudi government views Bitcoin and all other digital currencies as illegal and unauthorised in the country. Financial institutions in the country are also prohibited from conducting any transactions with cryptocurrencies.

As is the case in many other countries, there haven’t been many media reports outside of Saudi Arabia about arrests or convictions related to these laws.

11. Tunisia

Cryptocurrency is technically illegal in Tunisia. It’s unclear when crypto became illegal in the country, as the ban may just be a result of prior legislation regarding the legality of foreign currencies in Tunisia.

But what we do know is that Tunisian officials have arrested people for using Bitcoin.

In fact, in 2021, Tunisian officials arrested a 17-year-old boy for using crypto to pay for a transaction online. This led to outcry in the country over the harshness and relevance of these laws. The Tunisian finance minister responded to the incident by saying that he hoped to decriminalise digital asset ownership in the near future.

Thanks for Reading!

Thanks for checking out this list of places where bitcoin is (currently) illegal.

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