Bitcoin’s market capitalization has increased significantly in recent years and months. It’s still dwarfed by other asset classes, but it’s big enough to grab the attention of lawmakers and regulators. Is Bitcoin Legal?
This issue applies to all cryptocurrencies, and Bitcoin in particular due to its position in the market. Let’s start with the good news: Bitcoin is legal in most jurisdictions.
That said, there are still very few countries that have labeled Bitcoin as legal tender. As far as we know now, Japan is the only country where this is the case.
However, the fact that Bitcoin has that status almost everywhere does not mean that it is illegal, or cannot be used to pay. It does mean that there is no protection for the buyer or seller.
Where is Bitcoin illegal?
The possession or use of Bitcoin is (partly) prohibited in the following countries. North-Africa
- Algeria: (sale) sale and use of virtual currencies is prohibited (source).
- Egypt: transactions involving bitcoins are classified as haram (and therefore prohibited, source).
- Morocco: Bitcoin transactions are banned (source).
- Canada: Banks and financial service providers are not allowed to provide services to companies that facilitate trading in virtual currencies (source).
- Bolivia: all aspects of Bitcoin are banned (source).
- Colombia: almost completely banned (source).
- Ecuador: Ecuador’s government has banned Bitcoin and other digital currencies (source).
- Saudi Arabia: There is no explicit ban on Bitcoin, but rights of its users are not guaranteed. Implied ban (source).
- Jordan: Jordan’s central bank has banned banks, exchanges, financial sector companies, and payment processors from doing anything with Bitcoin or other digital currencies (source).
- Iran: Iran’s central bank bans banks and financial institutions from using cryptocurrencies (source).
- Bangladesh: Anyone “caught with cryptocurrencies could end up in jail” (source).
- India: The banking system in India is not allowed to provide services focused on cryptocurrencies (source).
- Nepal: completely banned (source).
- Pakistan: completely banned (source).
- China: Implied to all measures taken, Bitcoin is stated to be illegal in China (source).
- Taiwan: the Taiwanese government has not taken an explicit position, but the measures taken are highly restrictive (source).
South East Asia
- Cambodia: something can only be done with cryptocurrency if it has been licensed (source).
- Indonesia: as of January 1, 2018 it is no longer allowed to pay with Bitcoin (source).
- Thailand: Thailand’s central bank has imposed various bans on financial institutions, including investing and trading in cryptocurrencies (source).
- Vietnam: banned as a means of payment (source).
- Brunei: explicitly not legal tender (source).