While Bitcoin is welcomed in many parts of the world, several countries are wary of its volatility and decentralized nature. Some also perceive it as a threat to their current monetary systems while being concerned about its use to support illicit activities like drug trafficking, money laundering, and terrorism. Several nations have outright banned digital currency , while others have tried to cut off any banking and financial system support essential for its trading and use.
The Library of Congress identified 42 countries with implicit bans on certain cryptocurrency uses in its November update. Some of the countries it lists are:. The Library of Congress identified nine countries with absolute bans on cryptocurrency in November Since each individual's situation is unique, a qualified professional should always be consulted before making any financial decisions.
Investopedia makes no representations or warranties as to the accuracy or timeliness of the information contained herein. Financial Crimes Enforcement Network. Accessed Dec. Internal Revenue Service. Office of the Comptroller of the Currency. European Banking Authority. European Commission.
Canada Revenue Agency. Government of Canada Justice Laws Website. Canada Gazette. Australian Taxation Office. The New York Times. International Trade Administration. Library of Congress. Your Money. Personal Finance. Your Practice. Popular Courses. Cryptocurrency Bitcoin. Key Takeaways The cryptocurrency Bitcoin has raised financial concerns for governments worldwide. Despite its use for buying goods and services, there are still no uniform international laws that regulate Bitcoin.
Many developed countries allow Bitcoin to be used, such as the U. Several countries have made it illegal to use Bitcoin, including China and Egypt. Article Sources. Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate.
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All the actions taken to pull down cryptocurrency have been seen as efforts by the Chinese authorities to float their own e-currency. Besides China, another neighbouring nation of India has put in place a complete ban on cryptocurrencies. It's Bangladesh. The central bank of Bangladesh does not allow crypto-trading. Way back in September , it had stated that anybody caught using Bitcoin could be jailed under the country's strict anti-money laundering laws. Therefore, to avoid financial and legal risks, the central bank has warned against providing transactions or assistance in virtual currencies including bitcoin and refraining from promoting it.
Although Russia has not yet outrightly banned cryptocurrency yet, it's aiming to do it soon. Whereas in July , Russia for the first time designated cryptocurrency as property liable to taxation. Russia also has a law, which came into force in January , which bans Russian civil servants from owning any crypto assets. Even Russian President Vladimir Putin has repeatedly linked cryptocurrency with criminal activity , calling for closer attention to cross-border crypto transactions in particular.
If it comes into force, the ban is expected to prevent future transactions in crypto, but would not force current holders to divest their portfolios. Even in March , CBE indicated in a statement that there is a high risk involved in dealing in these currencies which are dominated by instability and extreme volatility in the value of its prices. This is a result of the uncontrolled global speculation that takes place on it, which makes investing in it risky and portends the possibility of a sudden loss of its value as a result of not issuing it from any central bank or any official central issuing authority.
In November , Morocco banned crypto trading. The government explicitly banned all cryptocurrencies, including Bitcoin. But despite the ban, Morocco has turned out to be the top nation for bitcoin trading in North Africa. Estimates from Triple A, a Singaporean cryptocurrency provider and aggregator, state that 0.
Even as per data from Useful Tulips, a platform that tracks peer-to-peer BTC trading across the globe, this trend is confirmed. In February , Nigeria announced the imposition of a crypto ban. But how? It's largely due to P2P peer to peer exchanges. After the February ban, Nigerians reportedly turned to P2P exchanges for their cryptocurrency transactions.
No financial institution is needed to facilitate the transactions on P2P platforms. That's why P2P trades are difficult for the regulatory bodies to trace and it will be hard to fish out and shut down the associated accounts. In June , Bolivia's central bank outrightly banned all currencies or coins that were neither issued by nor regulated through the government.
Although the central bank had specifically mentioned Bitcoin, Quark, Peercoin, Namecoin, Primecoin and Feathercoin in the announcement, the statement seemed to have included all cryptocurrencies. At that time, this directive by Bolivia was the first of its kind from a South American nation. Even to date, the ban remains in force. Although Qatar had been warning banks against trading in cryptocurrencies since , the middle east country banned cryptocurrency trading reportedly in January As per the statement, the services include fiat-to-crypto and crypto-to-crypto trading, custody, and financial services related to virtual assets.
It further specifically stated that the ban includes "anything of value that acts as a substitute for currency, that can be digitally traded or transferred and can be used for payment or investment purposes. In April , the Central Bank of the Republic of Turkey had issued a regulation banning the use of cryptocurrencies , including Bitcoin, directly or indirectly, for all payments. As per the Official Gazette published, the Central Bank of Turkey stated that cryptocurrencies and other such digital assets based on distributed ledger technology could not be used as an instrument of payment, whether directly or indirectly.
Click here to know more about it. Another country that has banned crypto, is Algeria. In the year , Algeria announced the banning of cryptocurrency. It passed a financial law that prohibits the use of cryptocurrency and made it illegal to buy, sell, use or hold virtual currencies.
To date, the law remains enforced in the country. In , the Iraqi Central Bank issued a statement clearly prohibiting the use of cryptocurrencies. This stance remains unchanged to date. Even earlier in , the Ministry of Interior of the Kurdistan Regional Government reportedly issued a statement warning all foreign exchange and money transfer offices to stop brokering cryptocurrencies or they will face legal action.
On 2 September , a decree legalizing crypto trading — also making it tax-free — and mining in the country came into force, making Uzbekistan a crypto-. The reason we are adding a legal tender section to CoinMarketCap is simple. We are seeing huge growth in crypto adoption around the world — just in , El. One example of a country embracing cryptocurrency is El Salvador, where Bitcoin was declared an official currency in September of by.