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When Bitcoin came out in 2009, it introduced the world to decentralized finance. Many people want to know if they can use Bitcoin legally since tax authorities, law enforcement agencies, and regulators worldwide are still arguing about how to control it.
Even though Bitcoin is accepted in many places, some countries are worried about its volatility and lack of central control. Some people also see it as a threat to their current financial systems and worry that it could be used to fund illegal activities like drug trafficking, laundering money, and terrorism. Several governments have openly outlawed digital money, while others have attempted to shut off any support for it from their banking and financial institutions.
It is an offense in Algeria to buy, sell, utilize, or keep virtual currency. This law became an official law in 2018 and made it illegal to use cryptocurrency.
Bolivia
Since 2014, Bolivia has had a complete ban on the use of Bitcoin. The Bolivian Central Bank banned it and all other currencies not controlled by a country or economic zone.
Colombia
In Colombia, banks cannot help people buy or sell Bitcoin. In 2014, the Superintendencia Financiera told financial institutions that they couldn’t “protect, invest, broker, or manage operations with virtual money.”
Egypt
Dar al-Ifta, Egypt’s leading Islamic advisory body, issued a religious decision in 2018 declaring Bitcoin transactions “haram,” which implies they violate Islamic law. Even though they are not legally binding, Egypt’s banking laws get stricter in September 2023 to stop people from trading or promoting cryptocurrencies without a license from the Central Bank.
The country’s central bank, Bank Indonesia, approved new rules on January 1, 2018 to forbid the use of cryptocurrency as a way to pay.
Iran
The relationship between Bitcoin and the Iranian government is not simple. Iran has turned to Bitcoin mining, which can make a lot of money, to pay for imports and avoid the worst effects of crippling economic sanctions.
Even though the Central Bank doesn’t allow trading of cryptocurrencies mined outside of the country, it has provided incentives for Bitcoin mining in the country.
India
India is getting more and more opposed to cryptocurrencies. On November 23, the government said it planned to bring a new bill to the Indian parliament that would create a new digital currency backed by the central bank and ban almost all other cryptocurrencies.
Iraq
Even though the government keeps trying to stop people from using them, cryptocurrencies are becoming more and more popular in Iraq. The Iraqi Central Bank has been especially against them. In 2017, it said that they couldn’t be used, and that rule is still in place today. Early in 2023, the Ministry of Interior of the Kurdistan regional government also told money brokers and exchanges that they couldn’t handle cryptocurrencies.
Kosovo
Even though it’s not illegal to own or trade cryptocurrency assets in Kosovo yet, the government banned cryptocurrency mining at the beginning of January, citing a growing energy crisis. The country, which declared its independence in 2008, is now facing the worst power shortages in its history. To save energy, scheduled power cuts have been put in place.
Nepal
According to the Nepal Rastra Bank, as of August 2017, Bitcoin is against the law.
North Macedonia
So far, North Macedonia is the only country in Europe that has a law against cryptocurrencies like Bitcoin, Ethereum, and others.
Turkey
As the value of the Turkish lira dropped, many people in Turkey turned to cryptocurrencies. With some of the highest use rates in the world, regulations came quickly this year as inflation reached its highest point in April.
Vietnam
The State Bank of Vietnam has said that issuing, selling, and using Bitcoin and other cryptocurrencies to pay is illegal and punishable by fines between 150 million VND and 200 million VND.
Where Bitcoin Is Against the Law
Bitcoin is a digital currency used by people all across the world. Although it’s becoming more popular, there are still some places where it is illegal to buy or use Bitcoin. These countries have a variety of concerns that range from issues with its effects on their economy to the law enforcement challenges of regulating it. In this article, we’ll go over some of the locations where Bitcoin is against the law and the reasons for their stance.
Countries Where Bitcoin Use Is Against the Law
As of 2020, Bitcoin is illegal in the following countries:
- Bangladesh
- Bolivia
- Cambodia
- Iran
- Iraq
- Russia
- Vietnam
These countries make up a majority of the nations where Bitcoin is not legal tender. Some other countries, such as India and Saudi Arabia, also ban the use of Bitcoin, but their official stance is not as strict as in the countries mentioned above.
Reasons for the Laws
The countries mentioned above have various reasons for prohibiting the use of Bitcoin. For example, in Bangladesh, it is illegal because the government fears that it could be used for money laundering and terrorist financing. In Russia, the government is concerned that it could be used to evade taxes or support money launderers. In Vietnam, the ban is based on the belief that Bitcoin use makes it difficult to protect users’ rights.
Frequently Asked Questions
Q: Is Bitcoin illegal everywhere?
A: No, not everywhere. Bitcoin is only against the law in certain countries where the government has specifically prohibited its use.
Q: Does the fact that Bitcoin is banned in some countries mean that it is not a legitimate currency?
A: No, the fact that some countries have banned the use of Bitcoin does not mean that it is not a legitimate currency. Bitcoin is still considered a legitimate currency in many countries where it is not banned.
Q: Is there any way to use Bitcoin in countries where it is banned?
A: Yes, in some cases, people in countries where Bitcoin is banned may be able to access it through cryptocurrency exchanges that are located outside of the country. However, this is not always possible and is not recommended due to the potential legal risks.
Summary
In summary, Bitcoin is currently illegal in several countries, including Bangladesh, Bolivia, Cambodia, Iran, Iraq, Russia, and Vietnam. The reasons for these bans vary but include potential money laundering, tax evasion, and difficulty protecting user rights. Although it is not legal everywhere, some people may be able to access Bitcoin through cryptocurrency exchanges that are located outside of these countries.