Crypto Trading, Mining Are Illegal and Punishable, Warns Nepalese Central Bank – Regulation

Mining and cryptocurrency trading is illegal in Nepal, the country's central bank has reminded citizens of the Himalayan nation. The regulator also warned that engaging in such activities would be subject to sanctions under current legislation. However, despite their position, Nepalis have continued to invest in Bitcoin, media reports show.

Engaging in illegal crypto activities is a punishable offense, says Nepal Rastra Bank in a statement

Cryptocurrency trading and mining are punishable as they are illegal in the country, Nepal Rastra Bank (NRB) noted in a recent alert titled “Cryptocurrency transactions are illegal.”

By note, which appeared on the central bank's website on Thursday, the financial regulator points to Nepal's Foreign Exchange Act, which was passed in 2019. Quoted by online news outlet Khabarhub, the NRA said:

Trading and mining cryptocurrencies and promoting illegal activities are punishable under applicable laws.

“Those who defraud people through these illegal activities will also be prosecuted,” the monetary authority further emphasized. The warning is directed against Nepalis who entice others to engage in coin minting or cryptocurrency exchanges.

Answering the question “Is it possible to trade cryptocurrencies including Bitcoin in Nepal?” in the FAQ section of its website the central bank institute says: "Cryptocurrencies including Bitcoin cannot be traded in Nepal. Doing such business is illegal."

Nepali media calls on the government to change its crypto policy

Since cryptocurrencies are banned in Nepal even under the NRB law, there have been reports from the government in Kathmandu in the past take tough action on related activities and even arrest People engaged in mining and trading. Nevertheless, Bitcoin has continued to attract the attention of the country's population and Article from local media have responded to this interest.

Despite NRB’s warnings, Nepalis have continued to invest in cryptocurrencies, according to local media. Some successful examples of people investing money in Bitcoin have had an impact on Nepali, Nepalese trends noticed in an article dedicated to cryptocurrencies last July that stated:

Cryptocurrency may be the future currency of the world… So there is a big suspicion that some people are still trading Bitcoin.

"It appears that Nepalis are investing in various ways. Some reports show that people are taking help from relatives and friends living abroad to invest in cryptocurrencies," the publication said. Such investments go largely unnoticed because Nepal lags behind in technological advancements and the central bank's inability to track and regulate Bitcoin transactions, the online edition mused.

The author, Tirsana Khadka, believes that immediate legalization of cryptocurrencies may be impossible, but believes that Kathmandu authorities cannot underestimate the increasing use of digital cryptocurrencies in businesses worldwide. “Since there is no third party involved in the transaction, the transaction is safe, fast and cheap,” says Khadka, insisting that “Nepal should soon change the perception of Bitcoin and cryptocurrency laws at the policy level.”

Do you think Nepali regulators will change their attitude towards crypto activities in the future? Share your expectations in the comments section below.

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