Bangladesh Bank warns against transaction in 'illegal' Bitcoin, other cryptocurrencies

The Bangladesh Bank has warned Bangladeshis against making online transactions in virtual currencies like Bitcoin.

Abdur Rahim Badal Chief Economics Correspondentbdnews24.com
Published : 27 Dec 2017, 05:15 PM
Updated : 27 Dec 2017, 06:26 PM

The notice – Caution on Bitcoin Transaction: Warning against online transactions in Crypto currency (eg. Bitcoin, Litecoin) – says these currencies are illegal in Bangladesh.     

Transactions in and of cryptocurrencies are getting popular worldwide on the internet.

Analyst Ahsan H Mansur told bdnews24.com that Bitcoin transactions were reported also in Bangladesh recently.

The central bank in a notice also said they had received reports from the media and information that transactions in cryptocurrencies like Bitocoin, Ethereum, Ripple and Litecoin were being made on exchange platforms in Bangladesh.

 

“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 says.

It says the Foreign Exchange Regulation Act, 1947 does not support use of such currencies either and online transactions in these currencies with unnamed people or people with pseudonyms may violate the Money Laundering Prevention Act, 2012.    

The notice also says that the users of cryptocurrencies in Bangladesh may put themselves in financial and legal risks.

“In this situation, the people are requested not to make transactions in virtual currencies like Bitcoin, or promote these or help others make such transactions in order to avoid possible financial and legal risks,” it adds.

Bangladesh Bank spokesperson Shubhankar Saha told bdnews24.com the bank issued the notice so that ‘no one makes transactions in cryptocurrencies under any circumstances’.

Analyst Mansur said Bitcoin was popular among ‘gamblers’.

“It had cost $100 once. Its value went up to $1,000 in a year and skyrocketed to $19,000 last week. Today it stands at $12,000. This is how Bitcoin rides the rollercoaster,” he said. 

“Many are investing in this currency to make profits, but they will be in danger if the people behind it leave the market,” he added.

He also thinks all the central banks should stop this ‘gambling’, which can ‘put the global financial system at risk’.  

“But there is a problem. Even countries like the US allow gambling. Millions of dollars are transacted in the casinos there. I don’t know how much keen they will be to stop this (Bitcoin),” Mansur said. 

According to the Bitcoin website, it uses peer-to-peer technology to operate with no central authority or banks.

Once you have installed a Bitcoin wallet on your computer or mobile phone, it will generate your first Bitcoin address and you can create more whenever you need one.

You can disclose your addresses to your friends so that they can pay you or vice versa.

Managing transactions and the issuance of Bitcoins is carried out collectively by the network.

Bitcoin is open-source, its design is public, nobody owns or controls Bitcoin and everyone can take part.   

Toufique Imrose Khalidi
Editor-in-Chief and Publisher