The number of countries banning cryptocurrencies has doubled in three years

While 2021 has been a good market year for the cryptocurrency industry, the number of jurisdictions banning cryptocurrencies has more than doubled since 2018.

A report by the U.S. Library of Congress (LOC) details nine jurisdictions that currently have absolute bans on cryptocurrencies, and 42 jurisdictions that have implicit bans on cryptocurrencies. The numbers are up from eight and 15, respectively, in 2018, when the report was first published.

The LOC is the research library of the United States Senate and is the national library of the United States.

According to the LOC report, the absolute prohibition means that any “deal in or possession of cryptocurrencies” is a crime, while the implicit prohibition prohibits cryptocurrency exchanges, banks, and other financial institutions from “dealing in cryptocurrencies or for the purpose of dealing in cryptocurrencies.” individuals/businesses providing services".

The nine new jurisdictions with absolute bans include Egypt, Iraq, Qatar, Oman, Morocco, Algeria, Tunisia, Bangladesh and China. China's cryptocurrency ban gets the most attention in 2021.

The number of jurisdictions banning or regulating cryptocurrencies has increased dramatically over the past three years, but shows no signs of slowing down, as some governments are currently reviewing their options. In addition to the 51 jurisdictions that have imposed cryptocurrency bans, 103 jurisdictions have implemented anti-money laundering and counter-terrorist financing (AML/CFT) laws, a 2-fold increase from the 33 jurisdictions that implemented such laws in 2018.

A Swedish financial regulator and the Swedish Environmental Protection Agency called for a ban on proof-of-work (PoW) mining in November, citing the electricity requirements and environmental costs of keeping the network running. This was heavily criticized by Paris-based Melanion Capital, which said the allegations against mining were "simply false."

Sweden's EU neighbor Estonia will implement anti-money laundering/counter-terrorist financing rules in February. These new rules are expected to change the definition of a virtual asset service provider (VASP) and impose an implicit ban on decentralized finance (DeFi) and bitcoin.

The Indian government created a panic last year when Indian lawmakers considered a cryptocurrency ban. The result was not an outright ban, but a push to regulate cryptocurrencies as crypto assets, with the Securities and Exchange Board of India (SEBI) overseeing the regulation of local cryptocurrency exchanges. However, a complete ban is not out of the question.

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