As much as we would like to use Bitcoin as a global payment method, that is just not possible at the moment. Even though Bitcoin is a decentralized currency that works on a worldwide scale, there are certain regions in the world where Bitcoin is forbidden. It goes without saying that these parts of the world will be interesting to keep an eye on in the future.
Asia Is Leading The Bitcoin Ban Charge
Digital currency could prove to be a powerful tool in the hands of unbanked and underbanked populations around the globe. That being said, many of those governments are struggling to keep the financial ecosystem in their full control. Thus, tension is created between the current infrastructure and new, disruptive technology.
Bitcoin is facing quite a few uphill battles, especially in Asia. Despite most Asian countries being frontrunners in terms of creating and adopting new technologies, the digital currency seems to be on government officials’ radars for the wrong reason. And this can be seen throughout the continent with no less than five major Asian countries having officially banned Bitcoin.
The biggest name on that list is China, a country that has built up a fair amount of history with Bitcoin in recent years. However, there is an asterisk to be made, as Chinese government officials have only banned Bitcoin usage by banks. The reason for that is simple, as China’s largest bank – The People’s Bank of China – is 70% owned by the Chinese government.
Mining and trading in Bitcoin for everyday consumers is not illegal in China. However, a clear example of the leniency towards Bitcoin for anyone other than banks can be seen by looking at BTC trading markets. Chinese Bitcoin exchanges are the biggest in terms of daily Bitcoin trading volume, with quite a large margin over their non-Asian counterparts.
Countries such as Thailand and Vietnam are operating in a slightly different way. Government officials from both countries are not officially enforcing a ban on Bitcoin, and the digital currency is still being used and traded in those regions without any consequences [for the time being]. However, that situation could change on any given day, creating some tension among Bitcoin enthusiasts in those countries.
Last but not least, things are far more severe in Bangladesh and India. If you are residing in Bangladesh, you might want to keep in mind that trading in Bitcoin and other digital currencies could lead to a 12-year prison sentence. Bangladesh law contains several sections that regulate trading in any foreign currency without general permission from the central bank, which also includes digital currency.
India recently made headlines in terms of Bitcoin bans when the country’s first Bitcoin exchange – called BTCXIndia – was forced to shut down operations to their bank no longer willing to work with Bitcoin-related businesses. Unfortunately for BTCXIndia, this seems to be an issue affecting all of the banks in the country at this point.
Europe & South America Are A Mixed Bag
When we are talking about Bitcoin regulations in Europe and South America, things are a bit different. Most countries are keeping a semi-open mind towards Bitcoin and digital currencies, although there are a handful of exceptions. Bolivia’s central bank, for example, issued a statement saying that using any currency not issued or controlled by a government or authorized entity is deemed illegal.
In fact, there is only one country that bans Bitcoin for a sensible reason other than “it is not our local currency so you can’t use it”. Ecuador is building their national digital cash system, which means Bitcoin would be a direct competitor to that model. After all, Ecuador’s own digital cash solution can still be controlled by the government, whereas Bitcoin can not.
The only European country with a somewhat efficient Bitcoin ban is Iceland. The country’s Central Bank referred to a law that states how purchasing digital currency could be seen as a violation of the Icelandic Foreign Exchange Act. Said Act does not allow the Icelandic currency to leave the country, regardless of whether it is in a physical or digital form.
Images courtesy of Shutterstock