Home / Crypto Currency / Bangladesh: Authorities Trying Yet Failing to Curb Cryptocurrency Use

Bangladesh: Authorities Trying Yet Failing to Curb Cryptocurrency Use

Despite threats of some of the planet’s harshest punishments, police in Bangladesh are struggling to stamp out the use of cryptocurrency in accordance with their legislation. Several different groups have recently combined resources at the behest of the central bank. As yet, there has been little progress towards eradicating the use of digital currency.

Harsh Penalties for Cryptocurrency Trading are Nothing New

Bangladesh’s draconian attitudes towards the rapidly expanding cryptocurrency space are hardly a recent development. Back in September 2014, the government made it illegal to transact in any form of digital currency. The maximum penalty for doing so is an unfathomably strict 12 years of jail time.

Late last year, the inefficacy of the threat of such harsh sanctions was revealed. A notice from the Bangladeshi Central Bank entitled “Caution on Bitcoin Transaction: Warning against online transactions in Cryptocurrency (eg. Bitcoin, Litecoin)” proved that the rampant use of digital currency in the nation was still a concern for the central financial institution. The document stated:

“As these are not legal tenders issued by any legal authorities of the country, no one can make any financial claim against these.”

The notice went on to state that those trading in digital currencies may be violating the Money Laundering Prevention Act 2012. In addition, the Foreign Exchange Regulation Act of 1947 was cited, along with a general plea from the bank for people to “not make transactions in virtual currencies.”

The latter request, along with recent multilateral efforts from various government and non-government departments to track down cryptocurrency users highlight how difficult the issue is to police.

The Bangladesh Financial Intelligence Unit (BFIU) and Foreign Exchange Police Department are currently searching for cryptocurrency traders. They have also drafted in the assistance of the Bangladesh Telecommunication Regulatory Commission (BTRC).

Nazmil Islam, Assistant Deputy Commissioner of the Cyber Crime Unit, told the Dhaka Tribune:

“We have already located a few bitcoin users, and are on the hunt for more, along with a few web pages which are being checked for authenticity. Investigating cryptocurrency trading is a complex matter.”

Bangladeshis working in the freelance sector and those who frequently travel outside of the nation are amongst those most likely to trade digital currencies, or so the BFIU believe. They also suggest that some notable cricket players have become involved with the space.

Despite the recent step up in operations against those dealing in cryptocurrencies, several factors point to a general failure by the authorities to curb the perceived problem. LocalBitcoins Bangladesh still has active traders offering to buy and sell BTC and another peer-to-peer platform, Paxful, offers Bangladeshi citizens over 300 different payment options for trading the digital currency. Meanwhile, a Facebook page called “Bitcoin Exchange: Bitcoin Buy and Sell Bangladesh” has also been created.

Finally, it’s rare to see governments and central banks issuing pleas like the one of December 2017 for people to stop committing crimes that are easily policed. If it was a simple task for authorities to track down and prosecute those who flout the law, an example would have surely been made by one unfortunate victim of the draconian legislation by now.

Meanwhile, there are also calls for the Bangladeshi authorities to stop wasting their scant resources on such “crimes”. A reporter for the Dhaka Tribune argued that the nation was in no position to be unsuccessfully chasing Bitcoin users:

“… crime rates are through the roof, corruption is omnipresent within our government, and terrorists are getting bail with impunity, our police force would do well to focus its efforts elsewhere… A quick glance at the streets is enough to betray the lawlessness which has overtaken our roads: Laws continue to be broken with little to no consequences, and police are often too happy to look away.”

Read more

Check Also

SBI Remit is Using the Blockchain to Make Money Transfers Between Japan and Africa

SBI Remit, a Japanese money transfer company, is teaming up with a venture-backed firm to use its new treasury management service that uses the blockchain for increased transparency and liquidity to small and medium-sized businesses operating between Japan and Africa. SBI Remit and BitPesa The service is provided by BitPesa, which has raised $10 million to turn the Bitcoin blockchain into an enterprise payment rail. Normally, consumers moving money from Japan to Africa have to rely on banks and other middlemen to make their transactions, first exchanging yen into U.S. dollars or euros, then into African currencies. BitPesa, on the other hand, uses a combination of the Bitcoin blockchain and other services to create new currency pairs which greatly simplify the process. The partnership follows a path already laid out by BitPesa, and specifically targets cosmetics companies, electronics companies, and the lucrative used car market between Japan and Africa. It enables direct currency pairs between Japanese yen and the fiat currencies of Ghana, Kenya, Morocco, Nigeria, Senegal, Tanzania, Uganda, and the Democratic Republic of Congo, according to Forbes. Generally speaking, by embracing the decentralized nature of the blockchain BitPesa illustrates how useful Bitcoin is for real world applications. Not only does this system permit remittances to be completed in less than an hour — thanks to the blockchain’s fast settlement times — it will also help jump start African commerce with Japan on a larger scale by adding a much-needed layer of trust and transparency, according to Nobuo Ando, SBI Remit director. “Many companies are doing trade with African countries and they are suffering from the high cost and the slow speed and not very precise administration,” said Ando. “So this is the market that we would like to go in, together with Bitpesa.” Moving Funds from Asia to Africa Historically, individuals and businesses conducting trade between Japan and the countries BitPesa serves had to move Japanese yen through multiple correspondent banks. As noted, along the way the yen was frequently converted to more liquid intermediary currencies like the U.S. dollar or the euro, which added lofty fees each step of the way. According to World Bank estimates, the average remittance fees for this process can reach 7%, but the real cost is often much higher. It can also take several days to complete. By removing these correspondent banks and secondary currency exchanges from the process, BitPesa is able to provide similar services almost instantly for less than 3% of the total transaction. To avoid fluctuations in the price of both fiat currency and Bitcoin, Elizabeth Rossiello, BitPesa founder, said her company’s treasury services are designed to insulate their customers from risk on either side: “If it makes sense for us to settle using cryptocurrency or fiat currencies then we do,” Rossiello said. “And in this case, we’re happy that SBI feels the same way, so we’re open to using digital or fiat currencies to settle between us.” Looking ahead, the remittances market in sub-Saharan Africa it is expected to grow 7% this year to $41 billion. Although this number is just a fraction of the worldwide remittance market as a whole, with relatively little competition for African business Rossiello is confident her company can use the lower costs of the Bitcoin blockchain to help catalyze commerce between Africa and the rest of the world. Rossiello, who is among the earliest founders of a Bitcoin company established BitPesa in 2013 when the cryptocurrency was trading between around $100 and $1,000. As of today, Bitcoin is trading at over $6,600. Featured image from Shutterstock. The post SBI Remit is Using the Blockchain to Make Money Transfers Between Japan and Africa appeared first on NewsBTC.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Disclaimer: Trading in bitcoins or other digital currencies carries a high level of risk and can result in the total loss of the invested capital. theonlinetech.org does not provide investment advice, but only reflects its own opinion. Please ensure that if you trade or invest in bitcoins or other digital currencies (for example, investing in cloud mining services) you fully understand the risks involved! Please also note that some external links are affiliate links.