It seems like every man and his dog has jumped on the cryptocurrency bandwagon in recent months, but for many people across the globe, they are legally not allowed to participate.
Cryptocurrencies – by definition – are decentralised and unregulated by central banks, which means there are no international laws that govern how it all works.
While this has been a major reason why people have moved towards cryptocurrencies, many governments around the world have remained hesitant and even gone so far as to ban the currencies.
Where Are Cryptocurrencies Legal Tender?
As it currently stands, only one country – El Salvador – has officially moved to recognise Bitcoin as legal tender. Earlier this month, El Salvador Congress officially approved a proposal by President Nayib Bukele to allow bitcoin to be accepted as an official form of payment.
Where Are Cryptocurrencies Banned?
Thailand is the most recent country to announce cryptocurrency bans, particularly relating to everyone’s favourite internet trend: meme coins.
The Thailand Securities and Exchange Commission (SEC) implemented a new ban on coins like Doge and Shiba Inu last week. It has ordered that all meme coins, social and utility tokens and NFTs be delisted from exchanges accessible in Thailand within the next 30 days.
“The Securities and Exchange Commission (SEC) Board has approved the new rules that prohibit digital asset exchanges from providing services in relation to utility tokens and certain types of cryptocurrencies,” the SEC posting reads.
“The rules also specify that the exchanges set a requirement to be imposed in the event that digital tokens issued by their own exchange or related persons are listed on the exchange. In this regard, the token issuer who fails to comply with the white paper and relevant rules in substance could risk having such tokens delisted from the exchange. This new regulatory guideline aims to enhance protection of digital asset traders’ interest.”
According to the SEC, the ban is aimed at protecting citizens from tokens with “no clear objective or substance” which are often influenced heavily by social media, as we’ve seen with Elon Musk’s Twitter commentary.
While this would obviously include the likes of Doge and Cumrocket, it’s unclear if more reputable currencies like Bitcoin and Ethereum, which have also been heavily swayed by social media trends, would be included as well.
As per the official SEC statement, the following crypto-related items are banned, however, the wording is vague and could be open to interpretation:
- Meme token: having no clear objective or substance or underlying, and whose price running on social media trends;
- Fan token: tokenized by the fame of influencers;
- Non-fungible token (NFT): a digital creation to declare ownership or grant of right in an object or specific right. It is unique and not interchangeable with digital tokens of the same category and type at the equal amount;
- Digital tokens which are utilized in a blockchain transaction and issued by digital asset exchanges or related persons.
Gizmodo Australia has contacted the Thai government for clarification.
China has not only moved to ban meme coins, but has essentially made it illegal to trade cryptocurrency altogether.
The country recently moved to ban banks and online payment channels from trading, clearing, settling or accepting cryptocurrencies, essentially banning Chinese residents from participating.
“Recently, crypto currency prices have skyrocketed and plummeted, and speculative trading of cryptocurrency has rebounded, seriously infringing on the safety of people’s property and disrupting the normal economic and financial order,” a joint statement from three Chinese industry bodies said, according to Reuters.
It’s worth noting that the government has not banned individuals from possessing cryptocurrencies, but has banned exchanges.
Following the effective ban back in May, a number of major cryptocurrencies took a huge tumble, with many still trying to recover more than a month later.
Despite being the native country of one of crypto’s biggest names – Vitalik Buterin – Russia has not been fond of cryptocurrency thus far.
It was actually banned until quite recently. It was only on January of 2021 that crypto — including meme coins — has been allowed in Russia. This means you can trade, mine and own cryptocurrency without any legal ramifications, provided you aren’t using the currency to spend on other goods and services within Russia.
However, the law still prevents Russians from using crypto as payment.
Ecuador moved to ban Bitcoin way back in 2014 ahead of launching its own digital currency. However, this has done very little to stop traders.
As part of a greater monetary and financial law reform, then-President Rafael Correa signed a bill that made bitcoin illegal in the country.
Bitcoin businesses were demanded to “shut down their operations immediately,” according to a Panam Post article at the time.
“Those who defy the ban will face prosecution, and all bitcoins circulated and assets in bitcoin trades face confiscation.”
Back in 2014, around the same time that Ecuador issued its crypto ban, Bolivia moved to ban any currency or coin not issued by the government.
“It is illegal to use any kind of currency that is not issued and controlled by a government or an authorised entity,” a translation of the statement released by the central bank said.
This ban includes Bitcoin, meme coins and any other currency that isn’t issued by a government body, with the Bolivian authorities citing protection of its own dollar, and of citizens as its reason for implementing the policy.
Bangladesh Bank – the country’s central bank – moved to ban cryptocurrency including Bitcoin back in December 2017, citing that it is not a legal currency in any other country in the world (however, it’s worth noting that El Salvador now considers it to be one).
“Transaction with this currency may cause a violation of the existing money laundering and terrorist financing regulations,” a news release on the Bangladesh Bank website reads.
While Iran hasn’t officially banned crypto, it has banned crypto mining for at least four months in 2021 after the country experienced widespread blackouts as a result of the power usage of mining.
This is significant because as much as 4.5 per cent of all Bitcoin mining is from Iran, which accounts for more than 2GW of power being drained from the grid per day, according to the BBC.
The ban is in place until September 22, 2021.