The advent of cryptocurrency was not welcomed globally or by everybody with warm hands. There are many countries that have or tried to ban Bitcoin, but still continued using blockchain, the technology supporting cryptocurrency.
While some other countries such as the USA, Canada, South Africa, European Union (EU), Nigeria, Australia, Japan, etc., are working towards achieving success in this lucrative-but-nascent digital payment sector by accepting or regulating their usage, cryptocurrencies remain prohibited in various parts of the world such as Macedonia, Ecuador, Vanuatu, China, Algeria, Bolivia, Afghanistan, Russia, Qatar, Egypt, Vietnam, Nepal, Columbia, Bangladesh, Saudi Arabia, Morocco, Pakistan, and others.
These states have banned cryptocurrency from being used as money, a currency or legal tender. Several regulators and governments impose heavy penalties and legal actions upon businesses and users of cryptocurrency. CoinIdol, a world blockchain news outlet, composed a list of top 5 countries with a non-friendly environment for Bitcoin and cryptocurrency business.
Unlike other technologies that have been widely supported by the Chinese government, cryptocurrency has faced the roughness of the financial watchdogs in the country.
In September 2017, regulators came out to announce that initial coin offerings (ICOs) were banned in China. There was a regulatory compliance evasion. Following the crackdown on ICOs and the use of cryptocurrencies in the country, crypto-exchanges that were offering facilitation services were forced to close with immediate effect.
Since then, the Chinese government has never come out to license or allow cryptocurrencies businesses to resume normally. However, the government is in full support for distributed ledger technology (DLT).
China banned BTC and the rest of cryptocurrencies, so as to give a way to its state-owned central bank digital currency (CBDC). So far, the process of issuing CBDC (digital yuan) is going on well. The digital yuan has been tested in several banks located in various Provinces of China.
This effort has totally killed the hopes of Bitcoin businesses and the entire cryptocurrency community in the country, though it’s a blessing in disguise for the digital yuan.
Just as it is the case with most Muslim countries, Algeria also decided to handle cryptocurrency business with an iron hand.
The terrorists have been taking advantage of cryptocurrency, and it’s the mandate of any government to fight and stop all ways through which such threats can increase. One of the ways was to ban the funding sources or ways of transferring the funds used to facilitate terrorism groups or any enemy of the Algerian government.
Bitcoin and other cryptocurrency related businesses are at this time prohibited under the Algerian financial law. The 2018 Financial Law of Algeria banned the usage of any virtual currency. The law stipulates: the buying, selling, holding, using, and possessing of cryptocurrency are forbidden. There is no way how cryptocurrencies businesses can grow when they are operating undercover and under a massive fear.
Due to the increasing criminal practices done by the nationals, Bolivian government decided to put an end to the use of cryptocurrency including Quark, BTC, namecoin, Ethereum, feathercoin, peercoin, primecoin, etc., in the country.
Following the increased undercover pyramid schemes that claimed the funds of many crypto-investors, the Central Bank of Bolivia wrote a statement banning the citizens from using cryptocurrencies and any other currency that is not licensed or registered by the authorities or the economic zone.
Following the bank’s directive in 2014, most of the bank accounts that belonged to the people associated with BTC, such as that of Mario Blacutt, a blockchain engineer and that of Evo Morales, were shut down. The action affected the cryptocurrency businesses in the country.
Currently, there is no regulation on the use of cryptocurrencies in Bolivia. However, the people advocating for financial innovations are tying their best using lawful means to liberate the cryptocurrency industry in the country.
The situation on cryptocurrency in India is a bit challenging. On one side, it looks like the government and the Reserve Bank of India (RBI) do not want to allow its citizens to participate in risky crypto-investments, while on the other side, some authorities such as the Supreme Court wants people to be given their financial freedom to trade in cryptoasset commodities.
Any action taken by the government is regarded by many as a serious one. So when the RBI bans cryptocurrency, it sends a big image to the investors who were interested in this industry to consider the country as unfriendly to cryptoasset. So most of them will be forced to try their talents elsewhere, hence hindering the growth of the cryptocurrency sector.
As it stands, the RBI, the body responsible for issuing and circulating the fiat money and regulating the banking system, is not yet friendly to all businesses related to cryptocurrency.
For a long time, Bitcoin has not been recognized as legal in Russia, citing the cryptocurrency-related activities as criminal. But starting January this year, cryptocurrencies have been slowly accepted in the country. Russia is slowly backing away from total cryptoasset ban.
However, the virtual coins are not being used in exchange for any goods and services. This kills one of the primary roles cryptocurrency was created for. Crypto was invented to act as a medium of exchange.
In Russia, cryptoasset including Bitcoin is still portrayed as “criminal” while DLT is considered in a neutral-to-positive light.
The mining, holding, and trading of cryptocurrency will remain limited in Russia, not until the government supports this industry by drafting a clear regulatory framework. The government is planning to release its CBDC known as digital ruble, and this move is more likely going to affect cryptocurrencies including BTC.