Financial Crime World

Nepal’s Cryptocurrency Conundrum: Compliance Issues Abound

A Shift in Stance: Nepal Rastra Bank’s Notice on Bitcoin Transactions

In August 2017, Nepal Rastra Bank issued a notice stating that all transactions related to or regarding bitcoins are illegal. This sudden shift in stance sent shockwaves through the cryptocurrency community, leaving many wondering what this means for the future of crypto in Nepal.

The crackdown on bitcoin-related activities was further solidified with the arrest of seven individuals by a police team from the Central Investigation Bureau (CIB) of the Nepal Police in early October 2017. These individuals were accused of running a bitcoin exchange business from various parts of the country, highlighting the lack of clarity around cryptocurrency regulations in Nepal.

Regulatory Uncertainty Surrounds Crypto Mining

The legality of crypto mining remains unclear in most jurisdictions, including Nepal. Under the Financial Crimes Enforcement Network (FinCEN), crypto miners are considered money transmitters, subject to laws governing that activity. In contrast, some countries have taken a more lenient approach to crypto mining.

  • Israel treats crypto mining as a business and is subject to corporate income tax.
  • Canada and the United States are relatively friendly towards the activity, although regulatory uncertainty still lingers in many other jurisdictions.

Global Perspective on Crypto Regulations

Despite the lack of clear regulations, few countries have outright banned cryptocurrency-related activities. Nepal’s stance on the matter remains unclear, leaving many wondering what the future holds for digital currencies in the country.

Seeking Expert Advice

For those seeking guidance on the legal status of digital currencies worldwide, Freeman Law offers expert advice on cryptocurrency and blockchain technology. The firm’s Cryptocurrency Law Resource page provides a comprehensive summary of the legal status of cryptocurrency in each country, with statutory or regulatory provisions governing the activity.

If you’re looking for expert advice on:

  • Cryptocurrency
  • Digital currencies
  • Tax planning
  • Tax compliance

Contact Freeman Law today to schedule a consultation or call (214) 984-3410 to discuss your concerns about cryptocurrency and blockchain technology.