Cryptocurrency is becoming ever more popular as a stable alternative to fluctuating fiat currencies. This is especially the case following the decline of economies in the wake of the Covid-19 pandemic. Blockchain has become an integral part of most of the world’s financial systems. More and more parliaments are passing legislation to protect, control, and regulate cryptocurrency. Why then have some countries maintained all out bans on cryptocurrency? Cryptolydian investigates.
Largely decentralised, cryptocurrency is for the most part not subject to the major capitalist powers of the world. Thus, they often view it as an intimidating system and a possible threat to domestic economic policies and capital.
A major oil-economy, Saudi Arabia, has banned cryptocurrency since its inception. Ostensibly, cryptocurrency is incompatible with the country’s religious shari’a law, which bans riba (interest) amongst other things. The ban is probably also due to the threat of its unregulated presence in the Kingdom’s undiversified, oil-reliant economy. However, Crown Prince Mohammed bin Salman has been seen as a reformer, and the country’s erstwhile conservative veneer has been radically changing under his charge.
Cryptoslate notes that most economies that have banned cryptocurrency have historically also been against their fiat currencies being traded on the free market. This is often true for communist economies such as Vietnam, socialist economies such as Bolivia, or religious economies such as Saudi Arabia.
The future of these bans
It seems nearly impossible that any economy will be able to maintain a cryptocurrency ban in the coming decades. Blockchain and cryptocurrency have become integral cogs in the world’s financial machine. As more knowledge and understanding is gained on the topic, more government’s have become welcoming of it as an important tool to boost the economy, as a more stable alternative to fiat currency, and, to investors and capitalists, a way of protecting their assets. The regulation of cryptocurrency has also often resulted in its taxability, which is a major positive to any economy.
Recent times have seen more and more previously crypto-averse countries such as China and Russia become major advocates in its favour. As time unfolds, we can look forward to more welcoming nods from the diverse economies of the world.