Bitcoin will be illegal

Ten agencies, including the central bank, financial, securities and foreign exchange regulators, vowed to work together to root out "illegal" cryptocurrency activity, the first time the Beijing-based regulators have joined forces to explicitly ban all cryptocurrency-related activity. Explainer: What's new in China's crackdown on crypto? China in May banned financial institutions and payment companies from providing services related to cryptocurrency transactions, and issued similar bans in and The repeated prohibitions highlight the challenge of closing loopholes and identifying bitcoin-related transactions, though banks and payment firms say they support the effort.

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Content:

• Bitcoin ban: These are the countries where crypto is restricted or illegal
• Explainer: Why does the Modi government want to ban private cryptocurrencies?
• Is Bitcoin Legal In India? Read Details As Bitcoin Price In India Surges 950% In One Year
• China declares all cryptocurrency transactions illegal
• Five Countries Where Cryptocurrencies Are Banned, and Why
• Why are countries so afraid of bitcoin?
• Countries looking to ban cryptocurrencies may play into the hands of Bitcoin

WATCH RELATED VIDEO: Bitcoin and Why Cryptocurrencies Will Fail - Wiktor Jaszczuk - TEDxYouth@2SLO

Bitcoin ban: These are the countries where crypto is restricted or illegal

Since the earliest days of Bitcoin , there have been concerns that it's only a matter of time until the cryptocurrency is banned by governments around the world. For one thing, Bitcoin is often cited as being a threat to traditional monetary systems, with the potential to undermine the control of central banks over the money supply. There are also concerns that Bitcoin facilitates drug trafficking, money laundering and ransomware , due to its pseudo-anonymous nature.

But whether or not it's actually possible for governments to ban Bitcoin can vary from region to region. The question of whether Bitcoin can be banned has been answered to an extent, since the cryptocurrency has already been officially banned in several countries. Currently, just a handful of countries place an outright blanket ban on Bitcoin—and prohibit interacting with, owning, or using the cryptocurrency in any shape or form. Several others, including Saudi Arabia and Taiwan , have also introduced a partial ban on the cryptocurrency, typically blocking financial institutions from dealing in the cryptocurrency or facilitating Bitcoin transactions.

So far, the vast majority of countries that have either restricted the use of Bitcoin, or banned it entirely, are relatively low down on The Economist 's Democracy Index , and many are considered flawed democracies or worse. Of all the countries that have taken a negative stance on Bitcoin, China has made some of the most aggressive moves against the cryptocurrency in Spurred on by its commitments to carbon neutrality and, pundits have pointed out, the imminent launch of its Bitcoin rival, the digital yuan , China has cracked down on cryptocurrency mining and crypto-related firms.

China has long maintained a ban on cryptocurrency trading, but in , the country forced crypto miners to shut down their operations and relocate out of the country, while the People's Bank of China PBoC issued an edict to payment platforms and banks ordering them to cease cryptocurrency activities.

Prior to the crackdown on mining, China controlled approximately two-thirds of the global Bitcoin mining industry. What followed was a mass exodus of miners, while crypto exchanges Huobi and OKEx limited services for Chinese customers. Even individual crypto-related accounts were blocked by popular social media website Weibo.

But the wider impact of the ban has been limited. Despite China's best efforts to clamp down on the crypto industry, people living in the country can still access crypto exchanges abroad by using virtual private networks VPNs. Meanwhile, Bitcoin's mining hash rate has steadily recovered from its initial slump following China's ban on mining. While Bitcoin's price has yet to recover its pre-ban heights of April and May , it has steadily increased since late July.

Currently, Bitcoin is legal in the United States. Furthermore, in , the U. Because of the patchwork of state and federal laws in the U. With all that in mind, the risk of a blanket ban on Bitcoin in the U. Indeed, billions of dollars have been invested in Bitcoin by American firms, while speculation still rages about when the United States will establish its first Bitcoin ETF , or exchange-traded fund.

However, there are still some risks, with Bitcoin coming in for criticism from regulators and some lawmakers. SEC chairman Gary Gensler has said in no uncertain terms that Bitcoin is a speculative asset, and that cryptocurrencies facilitate crime and do not qualify as money. And Senator Elizabeth Warren has voiced concerns that cryptocurrencies put the financial system "at the whims of some shadowy, faceless group of super-coders and miners.

While there's no evidence to suggest the U. Doing so could come at a serious economic cost, however. Although it is clear that it's quite possible for a government to issue an edict banning Bitcoin, actually enforcing such a ban would provide difficult—if not impossible—in many countries. Unless the government exerts strict control over the Internet, individuals would almost certainly be able to download Bitcoin wallet software, run a node, and complete transactions with little effort.

This is evidenced by the fact that there are still a significant number of Bitcoin users in most countries that have already banned it. Likewise, even in countries with strict Internet controls, a variety of tools used to bypass these restrictions could render the effort pointless. After all, it is incredibly difficult to enforce a ban on Bitcoin when practically anybody can access the Bitcoin blockchain via the Blockstream satellite using a relatively inexpensive software-defined radio SDR dongle and an antenna.

There's also the question of whether introducing a ban on Bitcoin would simply incentivize people to obtain it, an argument put forward by economist Saifedean Ammous , author of The Bitcoin Standard. His line of reasoning is that a government clampdown on Bitcoin would illustrate that the government in question is seeking to restrict people's financial freedoms, and would serve to highlight the cryptocurrency's usefulness.

Instead, he argued, governments could attempt to undermine the demand for Bitcoin by reducing the economic incentive to use it—by creating a better alternative. But with Bitcoin now legal tender in El Salvador , and Ukraine set to follow in its footsteps, Bitcoin appears to be gaining increasing acceptance among governments—and with each new country that adopts it, the likelihood of other countries imposing a ban on it diminishes.

In brief Some countries have already enacted blanket bans on Bitcoin. However, actually enforcing a ban on Bitcoin is a challenge. Censorship circumvention technologies enable even citizens of repressive regimes to access Bitcoin.

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Explainer: Why does the Modi government want to ban private cryptocurrencies?

Experts say large-scale Chinese miners of cryptocurrency — the likes of Bitcoin and Ethereum — will take their high-powered, electricity-guzzling servers offshore. Exchanges of the digital money and the numerous Chinese startups linked to the trade also are expected to rebase offshore after dropping domestic customers from their rosters. On Sept. The notice, issued in tandem with nine other government agencies, including the Bureau of Public Security, declared all related business illega l and warned that cryptocurrency transactions originating outside China will also be treated as crimes. Chinese banks began to prohibit the use of digital currencies in and stepped up regulations after

Is Bitcoin Legal In India? Read Details As Bitcoin Price In India Surges 950% In One Year

Of course, the untraceable payments are worth a lot to ransomware hackers, cyber criminals and money launderers. If someone invents a cryptocurrency, any value is based solely on convincing others it has value. But is it a usable means of exchange? International banking officials say cryptocurrencies such as bitcoin are speculative assets, not sustainable, usable money. Yet the epidemic of hugely disruptive ransomware attacks in recent months — on JBS Foods, a major meat processor; on Colonial Pipelines, our critical infrastructure, causing gasoline shortages for weeks; and on 1, or more U. Moreover, hundreds of small towns, hospitals, school districts and small businesses have been hit by the ransomware epidemic — all enabled by cryptocurrencies. How should governments respond?

China declares all cryptocurrency transactions illegal

I am writing this to clarify what I think of Bitcoin. Please pay attention to what I am saying here and not what those in the media are saying I said because this is reliable. I am finding that those who want to promote Bitcoin which is most people are characterizing it one way while those who are against it which are a few scared souls cowering in a corner are characterizing it another way. As with most things I comment on, the reality has pros and cons and I am trying to be as accurate as possible to communicate what I understand these to be. Still, people demand my non-expert assessment of Bitcoin and clarifications in my own words are better than distortions in the media so here it goes, presented with the warning not to rely on it.

Five Countries Where Cryptocurrencies Are Banned, and Why

Bitcoin is a contentious asset for many people, particularly those in positions of power. The ability to print money is one of the most valuable powers a government possesses. However, bitcoin's ascension has not been without some significant speed bumps. Certain countries frown upon it because it is not backed by a central bank or government. We can't deny that emotions have played a role in driving cryptocurrency prices higher. The fear of missing out on big gains has kept the demand for bitcoin and other digital currencies high.

Why are countries so afraid of bitcoin?

The RBI is exploring the possibility of coming up with an official digital token in the country. In a meeting chaired by Prime Minister Narendra Modi recently, the Union government and the Reserve Bank of India RBI were not quite on the same page on cryptocurrency — a sector that has been silently blooming in India over the past few months. On the other hand, the Modi government and its departments mooted for a strong regulatory control on cryptocurrency to avoid money laundering and terror financing, rather than banning it entirely. There was consensus also that the steps taken in this field by the government will be progressive and forward looking," a source told news agency PTI following the meeting chaired on Saturday, November The RBI has repeatedly reiterated its strong views against cryptocurrencies since it gained popularity in India following a sudden boom in Bitcoin prices.

Countries looking to ban cryptocurrencies may play into the hands of Bitcoin

China's central bank on Friday declared all transactions involving Bitcoin and other virtual currencies illegal, stepping up a campaign to block use of unofficial digital money. BEIJING — China's central bank on Friday declared all transactions involving Bitcoin and other virtual currencies illegal, stepping up a campaign to block use of unofficial digital money. Chinese banks were banned from handling cryptocurrencies in , but the government issued a reminder this year.

The report, " Cryptocurrencies: trends, risks, measures ," was presented during an online press conference with Elizaveta Danilova, the director of the Bank of Russia's Financial Stability Department. The report says cryptocurrencies are volatile and widely used in illegal activities such as fraud. By offering an outlet for people to take their money out of the national economy, they risk undermining it and making the regulator's job of maintaining optimal monetary policies harder, the report said. The bank, therefore, said Russia needs new laws and regulations to effectively ban crypto-related activities.

Bitcoin has had a very tumultuous summer. ICOs have been used by startups to raise funds via selling tokens or virtual currency such as bitcoin to their early investors, similarly to the way that a company would sell shares during an initial public offering. However, in the past, there have been fraudulent ICOs that targeted investors. The bank also said that any startups that raised funds via ICOs were required to issue refunds. Bitcoin transactions are encrypted and while they can be tracked by involved parties, bitcoin provides a way to keep money and transactions away from the prying eye of the regulators.

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