Some Countries Officially Ban Bitcoin & Crypto Currency 

Bitcoin has been the subject of controversy since the new year of 2009, as has the next cryptocurrency to follow. While widely criticized for its volatility, use in illegal transactions, and the exorbitant use of electricity to mine it, crypto is viewed by many, particularly in developing countries, as a safe harbor during economic storms.

El Salvador was the first country to make it a legal currency in September 2021, followed now by the Central African Republic in April this year. But as more and more people turn to cryptos as either investments or saviors, criticism of crypto continues to manifest in a series of restrictions on its use.

The legal status of Bitcoin & other altcoins (coins another way to Bitcoin) varies substantially from country to country, while in some countries, the relationship still has to be defined legally or is constantly changing.

While most countries do not make the use of Bitcoin itself illegal, its status as a means of payment or as a commodity varies with different regulatory consequences. Some countries have already restricted the way Bitcoin can be used, using banks to prohibit their customers from making cryptocurrency transactions. Other countries have banned the private use of Bitcoin and cryptocurrencies using severe sanctions for anyone who makes crypto transactions.

These are the countries that have full interaction using Bitcoin and other altcoins.

Algeria

Algeria currently prohibits the use of cryptocurrencies following the passage of a finance law in 2018 which made it illegal to buy, sell, use or hold virtual currency.

Bolivia

There has been a complete embargo on the use of Bitcoin in Bolivia since 2014. The Central Bank of Bolivia passed a resolution prohibiting it and any other currency that is not regulated by the country or economic zone.

China

China has been cracking down on cryptocurrencies with increasing intensity throughout 2021. Chinese officials have repeatedly issued warnings to their people to stay away from the digital asset market and have severely suppressed mining in the country and currency exchange in China and abroad.

On Aug. 27, Yin Youping, Deputy Director of the People’s Bank of China (PBoC) Financial Consumer Rights Protection Bureau, called cryptos a speculative asset and warned people to “protect their pockets”.

Attempts to weaken Bitcoin – a decentralized currency outside the control of governments and institutions – are mostly seen as attempts by the Chinese authorities to develop their electronic currency.

The PBoC wants to be one of the first major central banks globally to launch its digital currency, and doing so will be able to more closely monitor people’s transactions. On September 24, the PBoC went a step further & personally banned cryptocurrency transactions in that country.

Colombia

In Colombia, financial forums are not permitted to facilitate Bitcoin transactions. The Superintendencia Financiera warned financial forums in 2014 that they should not “protect, invest, mediate, or manage virtual money operations”.

Egypt

Egypt’s Dar al-Ifta, the country’s primary Islamic advisory body, issued a trust decree in 2018, classifying Bitcoin transactions as “haram,” something that is illegal under Islamic rules. Although non-binding, Egyptian banking laws were tightened in September 2020 to prevent trading or promoting cryptocurrencies without a Central Bank license.

Indonesia

Bank Indonesia, the country’s central bank, issued a new regulation banning the use of cryptocurrencies, including Bitcoin, as a means of payment starting January 1, 2018.

Iran

Bitcoin has complex interactions with the Iranian regime. To avoid the worst effects of crippling economic penalties, Iran has instead turned to lucrative Bitcoin mining practices to finance imports.

While the Central Bank prohibits the trading of cryptocurrencies mined overseas, the Central Bank has encouraged Bitcoin mining in the country using incentives.

About 4.5% of global Bitcoin mining occurs in Iran, which from blockchain analytics firm Elliptic, could generate revenues of over $1 billion (€843 million). For the crypto industry to thrive, Iran has provided cheap labor on licensed miners but requires all crypto that is mined to be sold to the Central Bank.

However, uncontrolled mining drains more than 2GW of the national network every day, resulting in a power shortage. To this end, Iranian authorities issued a four-month Bitcoin mining embargo until September 22.

India

India is increasingly hostile to cryptocurrencies. On November 23, the government announced its intention to introduce a new bill to the Indian parliament that would establish a new central bank-backed digital currency and bans almost all cryptocurrencies.

Earlier in 2021, he had considered criminalizing the ownership, issuance, mining, trading, and transfer of crypto assets. Prime Minister Narendra Modi said he wanted to ensure crypto “does not end up in the wrong hands, which could disrupt our youth.

Iraq

Despite the authorities’ ongoing efforts to block its use, cryptocurrencies are becoming increasingly popular in Iraq. The Central Bank of Iraq was extremely hostile, starting in 2017 and banning its use which is still in effect today.

In early 2021, the Interior Ministry of the Kurdistan region government issued similar guidelines to stop money and exchange brokers from dealing with cryptocurrencies.

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Kosovo

While holding or trading cryptocurrency assets is not yet legal in Kosovo, the government announced an embargo on crypto mining in early January, blaming a developing energy crisis. The country, which unilaterally declared its independence in 2008, is facing a historic electricity shortage with periodic blackouts now being enforced to save energy.

In a further effort to curb wastage of manpower, Economy Minister Atrane Rizvanolli announced a long-term embargo on crypto mining in the country. The police have been tasked with enforcing the embargo and selecting mining sites across the country.

North Macedonia

North Macedonia is the only European country so far that has an official embargo on cryptocurrencies, such as Bitcoin, Ethereum, and others.

Russia

Russia has a checkered association with cryptocurrencies, further complicating its continued annexation of Ukraine. Although crypto is not allowed in Russia until recently there has been a fight being waged against its use.

Now, it is seen as a savior to help the country avoid the harsh financial penalties imposed by the West. Russia passed its first law to regulate cryptos in July 2020, which for the first time made cryptocurrencies a taxable property.

The law, which came into effect in January this year, also prohibits Russian civil servants from owning any crypto assets. Russian President Vladimir Putin has repeatedly linked cryptocurrencies to criminal activities, calling for closer attention to cross-border crypto transactions in particular.

In July, the attorney general announced a proposed new law that would allow police to confiscate cryptocurrencies believed to be illegally obtained under the pretext of using them in bribery.

However, being the third-largest mining center globally from the data according to the University of Cambridge, it is feared that Russia can now embrace crypto and take advantage of its natural resources to exploit Bitcoin mining rather than underestimating it.

Turkey

Many people in Turkey are turning to cryptocurrencies because the value of the Turkish lira has plummeted. With some of the highest usage rates anywhere globally, the arrival of regulation has been swift this year as inflation peaked in April.

On April 16, 2021, the Central Bank of the Republic of Turkey issued a regulation prohibiting the use of cryptocurrencies including Bitcoin, personally or impersonally, to pay for goods and services. The following day, Turkish President Recep Tayyip Erdoğan went a step further and issued a decree that crypto exchanges to the list of companies subject to the anti-money laundering and financing of terrorism budget.

Vietnamese

The State Bank of Vietnam has declared that the issuance, supply, and use of Bitcoin & other cryptocurrencies is illegal as a means of payment & can be subject to penalties ranging from 150 million VND to 200 million VND However, the government does not prohibit Bitcoin trading or hold it as an asset.

Several countries have issued budgets to prohibit the use of cryptocurrencies in their financial systems, but one thing to be aware of is that cryptocurrencies can spread without knowing any boundaries.

The restriction only applies to the official economic system, but the ability of cryptocurrency is very difficult for any party to support because it is decentralized and follows existing market procedures.

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