The awareness about the benefits of cryptocurrencies and the popularity of Bitcoin has led to a debate. And, the theme of this debate is the legality of Bitcoin and other cryptocurrencies. The stories of Winklevoss twins and other Bitcoin billionaires are spreading like wildfire and every cryptocurrency enthusiast has heard of these stories. That’s why people, no matter where they live are always in a fit state to plough money into this pure digital gold. Bitcoin with this leadership in the market can and is creating a global financial ecosystem that is governed by no laws or regulations.
There are many countries in which Bitcoin and other cryptocurrencies are illegal. However, it does not mean that Bitcoin is a legal tender in the remaining countries. Only the Japanese government has designated it as a legal tender. Not being a legal tender does not disallow you from performing transactions using Bitcoin. It simply means that performing transactions using Bitcoin is completely discretionary and there is no legal protection for the merchant or the consumer.
Zimbabwe and some other smaller nations still have qualms and that’s why cryptocurrencies like Bitcoin are illegal in these countries. And, according to European Central Bank, this decade old cryptocurrency is not mature enough for regulations. Institutions like European Commission think that there is a need for dialogue. Apart from deciding whether it should be legalized or not, another issue in the US is – Who will legalize Bitcoin, federal government or individual states?
So, after giving you the idea of Bitcoin and its benefits over the fiat currencies, we have compiled a list legal positions of Bitcoin in major Asian countries.
Bitcoin in Asian Countries
|Bangladesh||From 2015, it’s a punishable offence. It’s 2018 and they are hunting for cryptocurrencies traders.|
|China||The People’s Bank of China issues following statement in February 2018:
“It would block access to all domestic and foreign cryptocurrency exchanges and ICO websites.”
All mining activities and cryptocurrency trading are most likely to be eliminated in the country. ICOs have already been banned in September 2017. However, traders and investors have switched to foreign exchanges based in Japan and Hong Kong.
But virtual currencies are illegal in China.
|India||In addition to a couple of warnings issued by the central bank of India, the finance minister in a 2017 interview clarified that Bitcoin is not a legal tender. There are no regulations to cover Bitcoin and other cryptocurrencies. All of the Indian financial institutes have been barred from conducting businesses with cryptocurrency exchanges.|
|Iran||In April this year, the central bank of Iran along with a principal market regulator has said that no financial institute or business should deal in cryptocurrencies such as Bitcoin.|
|Japan||Bitcoin has been declared legal tender in early 2017. A law was passed to bring Bitcoin exchanges under know-your-customer and anti-money laundering regulations.
The Financial Services Agency has suspended two exchanges and made it mandatory for five other to improve security measures. A cryptocurrency exchange industry study group has been established to look into institutional issues associated with Bitcoin and other assets.
|Kazakhstan||Though there are no strict regulations, the National Bank of Kazakhstan is most likely to ban trading and mining of Bitcoin or any other cryptocurrency. Here is what the head of National Bank of Kazakhstan, Daniyar Akishev said:
“The approach of the National Bank of Kazakhstan to this issue is very conservative. I welcome stringent restrictions, that is, we want to prohibit purchase and sale of the national currency for cryptocurrency, we want to prohibit exchanges in this segment and any kinds of mining”
|Kyrgyzstan||4 years ago in 2014, transactions using Bitcoin or other cryptocurrencies were declared against the law. It is still illegal.|
|Malaysia||Securities Commissions and country’s central bank are working together on a cryptocurrency regulation framework. A cautious approach has been adopted by the authorities but their intentions are very clear – no ban.|
|Pakistan||In the month of April 2018, central bank of Pakistan issued a statement and barred financial companies and institutes from working with cryptocurrency exchanges and other related firms.|
|Russia||Cryptocurrency legislation is expected in mid-2018. Russia is working to protect Russians from scams while legally working with Bitcoin and cryptocurrencies. In October 2017, also bolstered by a mandate from Putin, State Duma is putting efforts. Russia has realized the importance of a ‘Single Payment Space’ within the Eurasian Economic Union. The focus is also on licensing of Bitcoin mining operations and increasing scrutiny of token sales.|
|Singapore||The Money Authority of Singapore has not shown any willingness to ban Bitcoin and other cryptocurrency trading and mining. The authority is also examining the need for new rules to protect investors from scams. Terrorism financing and anti-money laundering rules will be imposed on cryptocurrency exchanges.
Apart from issuing warnings on Bitcoin or cryptocurrency investments, the central bank of Singapore is working on framing a framework to regulate Bitcoin payments.
On May 24, eight cryptocurrencies exchanges involved in unauthorized trading were warned by Money Authority of Singapore. However, Bitcoin or any other cryptocurrency is not legal tender.
|South Korea||Cryptocurrency margin trading and ICOs were banned in September 2017. On June 4, The Top Court of South Korea has now recognized 7 cryptocurrencies as an asset. The legislative body, South Korea’s National Assembly has proposed to allow domestic ICOs. The Assembly stated:
“We will also establish a legal basis for cryptocurrency trading, including permission of ICOs, through the National Assembly Standing Committee.”
The new measures outlined by South Korea’s Financial Services Commission have been implemented earlier this year. The room for cryptocurrency transactions involved in tax evasion and money laundering is reduced. Compliance with AML and KYC are mandatory.
|Thailand||Thai Securities and Exchange Commission has unveiled new crypto laws legalizing 7 cryptocurrencies. This will allow industry to grow in a well-regulated legal environment and also protect investors. A new framework for regulating cryptocurrency has been approved by the Securities and Exchange Commission of Thailand. These regulations will go effective later this month. Bitcoin, Bitcoin Cash, Ethereum, Litecoin, Ethereum Classic, Ripple and Stellar are the coins that can be traded as ‘trading pair’.|