Countries That Have Banned Cryptocurrency

Each country has its own specific way of reacting to cryptocurrency. While several countries have started accepting cryptocurrency, others have banned it. This is because before digital currencies are being legalized, there must be special legislation[s] to manage them. The following countries have banned cryptocurrency because they either see it as a threat to their society or cannot yet link it with other legislations e.g. for example, corporate law, investment caps, and sectoral investment. Citizens can only buy, sell, or exchange cryptocurrency when it is subject to rules so crypto trading in these countries is a no-no.

Countries That Have Banned Cryptocurrency

1. China
Since 2018, China had shut down domestic cryptocurrency exchanges after issuing a notice that “fundraising and trading” platforms are prohibited in China. Also, all ICO [initial coin offerings] in China is prohibited and illegal. According to a statement issued by the ex-governor of the People’s Bank of China, Zhou Xiaochuan, local financial institutions have received instructions not to recognize cryptocurrency as a tool for any retail payment. However, Chinese citizens are not prohibited from holding or transacting cryptocurrency as there is no law or regulation bounding it. 

2. Turkey
The Turkish government has always made its intentions known about cryptocurrency. They are not ready to regulate or form a central authority for the coins. The Turkish government sees digital currency as a risk to investors since losses cannot be recovered. Recently, the central bank of Turkey enacted a ban on cryptocurrency payments, doubling down restrictions on cryptocurrency exchanges.

3. Bangladesh
Laws regarding crypto differ from country to country as the regulators have different opinions as to how virtual currencies should be managed or handled. However, the Bangladesh government shares a different opinion. In 2017, Bangladesh’s central bank issued a notice stating that activities related to cryptocurrencies are illegal in Bangladesh. Any transaction with cryptocurrencies will therefore violate existing money laundering, foreign exchange, and terrorist financing regulations.

4. Algeria
In Africa, Algeria has prohibited the sale, purchase, exchange, use, and possession of cryptocurrencies. Anyone found investing in crypto will face the wrath of the law. 

5. Nigeria
In February 2021, the government of the Federal Republic of Nigeria further strengthened the ban on cryptocurrency exchanges. Africa’s largest economy threatens to shut down banks, financial institutions, and bank accounts found providing crypto services.

6. Bolivia
Bolivia’s ban on cryptocurrency by the central bank was put in place in 2014 to protect investors and the national currency.

Although India initially banned cryptocurrencies because the government believes it is an illegal funding activity. However, India’s government is currently passing a bill proposing to own its own CBDC [central bank digital currency] – the digital rupee. 

While 2021 has been a big year for cryptocurrency, the aforementioned countries continue to consider these coins illegal. Howbeit, some countries are working on building regulations that will require cryptocurrency exchange platforms to obtain a license before operation. With the way things are going, in the coming years, some of these countries that have banned digital currency will lift their ban.

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