Bangladesh to Introduce Crypto Regulations by 2024
The dynamic realm of virtual assets has been gaining significant traction in Bangladesh in recent years. The increasing adoption of cryptocurrencies clearly indicates that this innovative technology is growing in popularity among individuals, businesses, and consumers in the country. Several factors have contributed to the rapid growth of the crypto industry in Bangladesh.
Crypto Adoption in Bangladesh
Bangladesh ranked 17th on the 2023 global adoption index, highlighting the growing acceptance and utilization of cryptocurrencies in the country. The development of knowledge and easy access to the internet have played a pivotal role in enabling individuals to participate in the crypto market. Numerous exchanges and platforms facilitate the buying and selling of digital currencies in Bangladesh. Additionally, cryptocurrencies have also played a significant role in promoting financial inclusion in the country.
Crypto Regulations in 2024
In 2020, the Government of the People’s Republic of Bangladesh released the National Blockchain Strategy, recognizing the crucial importance of technologies like blockchain. However, it is important to note that crypto is still considered illegal in Bangladesh. Financial institutions are prohibited from facilitating Bitcoin transactions. In 2017, Bangladesh issued a ban on the use of Bitcoin and other cryptocurrencies, classifying them as offenses punishable by imprisonment.
Despite the global expansion and recognition of cryptocurrencies, Bangladesh has not yet embraced digital currencies. There are two primary reasons behind the government’s decision to not legalize crypto. Firstly, the volatility of cryptocurrency values and the lack of anonymity associated with them raise concerns. Secondly, the government fears that legalizing crypto could have a detrimental impact on Bangladesh’s economy.
While the government maintains a hostile view towards cryptocurrencies, it has made them illegal under the Foreign Exchange Regulation Act. According to this act, individuals involved in crypto-related activities in Bangladesh face severe consequences under the Foreign Exchange Regulation Act of 1947, the Anti-Terrorism Act of 2009, and the Money Laundering Prevention Act of 2012.
Taxation
Due to the ban on cryptocurrencies in Bangladesh, there is currently no taxation system in place for crypto. However, it is possible that a regulated crypto framework will be established in the future.
Legal Status Overview
As mentioned earlier, the government of Bangladesh does not have a favorable stance towards cryptocurrencies. Here is an overview of how crypto entities are treated in the country:
– Bitcoin: Illegal
– NFTs: Illegal
– Trading: Illegal
– DeFi: Illegal
– Mining: Illegal
Future Prospects and Challenges
The trajectory of digital currencies’ growth and global adoption is well-known. It is possible that there will come a time in the future when the government has no choice but to legalize cryptocurrencies in Bangladesh. However, the government must be prepared with effective plans to ensure that the economy is not negatively impacted and citizens are not burdened by ineffective laws.
Bangladesh has a population with a significant interest in cryptocurrencies, and therefore, it is hoped that a robust regulatory framework will be established to facilitate cryptocurrency operations in the future.
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