Cryptocurrency, a digital or virtual currency, has been taking the world by storm since the inception of Bitcoin in 2009. The decentralized nature of cryptocurrencies makes them appealing to many individuals and institutions worldwide. However, the legality of cryptocurrencies varies from country to country. In this article, we will explore the legality of cryptocurrencies in Bangladesh.
Legal Status of Cryptocurrencies in Bangladesh
Bangladesh Bank, the country's central bank, issued a warning in 2017, stating that transactions with cryptocurrencies are illegal. The warning was issued in response to the growing interest in cryptocurrencies in Bangladesh, and the central bank expressed its concerns about the potential for money laundering and terrorist financing. In addition, the Bangladesh Bank warned that trading in cryptocurrencies could lead to legal consequences, including imprisonment.
The ban on cryptocurrencies in Bangladesh was reiterated in 2018 when the country's Finance Minister, Abul Maal Abdul Muhith, stated that the use of cryptocurrencies is illegal under current laws. He added that anyone caught using cryptocurrencies could face up to 12 years in prison.
The legal framework in Bangladesh prohibits the use of any currency that is not issued or regulated by the government. As cryptocurrencies are not issued or regulated by any government, they fall under this category. Therefore, any transaction involving cryptocurrencies is illegal in Bangladesh.
Impact of the Cryptocurrency Ban in Bangladesh
The cryptocurrency ban has had a significant impact on the Bangladeshi cryptocurrency market. As a result of the ban, local cryptocurrency exchanges have shut down, and investors have been forced to seek alternatives in neighboring countries.
The ban has also impacted the country's economy, as it has prevented businesses from accessing the benefits of blockchain technology. Blockchain technology has the potential to increase transparency, reduce costs, and improve efficiency in various sectors, including finance, logistics, and supply chain management.
Furthermore, the ban has also prevented individuals and businesses in Bangladesh from taking advantage of the opportunities that cryptocurrencies offer, such as faster and cheaper cross-border payments and access to global markets.
When Will Cryptocurrencies be Legal in Bangladesh?
It is difficult to predict when cryptocurrencies will be legal in Bangladesh. However, there have been some positive developments in recent years.
In 2020, the Bangladesh Bank formed a committee to study the potential benefits of blockchain technology and cryptocurrencies. The committee includes representatives from the central bank, the Ministry of Finance, the Securities and Exchange Commission, and the National Board of Revenue.
The committee is expected to submit its findings and recommendations to the government soon. If the government decides to lift the ban on cryptocurrencies, it could lead to the legalization of cryptocurrencies in Bangladesh.
In addition, there is a growing global trend towards the regulation of cryptocurrencies. Many countries, including the United States, the United Kingdom, and Japan, have introduced regulations that allow for the legal use of cryptocurrencies. This trend may influence the government's decision to lift the ban on cryptocurrencies in Bangladesh.
Conclusion
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In summary, cryptocurrencies are currently illegal in Bangladesh, and anyone caught using them could face legal consequences, including imprisonment. The ban on cryptocurrencies has had a significant impact on the Bangladeshi cryptocurrency market, the economy, and businesses that could benefit from blockchain technology.
While it is difficult to predict when cryptocurrencies will be legal in Bangladesh, the formation of a committee by the Bangladesh Bank to study the potential benefits of blockchain technology and cryptocurrencies is a positive step towards their legalization. If the government decides to lift the ban, it could lead to a significant shift in the cryptocurrency landscape in Bangladesh.