Nepal Enforces Crypto Crackdown By Ordering ISPs To Block Crypto Transactions
According to reports, Nepal has taken another major step toward blocking the use and transfer of cryptocurrency in the country. The country’s telecommunication authority has ordered internet service providers to shut down all crypto-based online activities.
Another Hardline Approach
Nepal has a history of not-so-friendly actions against crypto, and the latest move is a reference to its previous stance. Accordingly, the telecom authority has ordered all internet service providers (ISPs) to shut down every crypto-related activity on the internet.
This includes, but is not limited to, websites, applications, and online networks related to crypto. In September 2021, Nepal’s central bank announced a blanket ban on all crypto activities, including mining and trading digital assets.
Despite the ban, the government went to the extreme by assigning individuals to carry out an undercover observation of any ongoing crypto activities in the country. As it stands, Nepal has deemed crypto trading an “illegal activity” in the country, which follows a similar pattern to that of mainland China.
Following the latest move, the government threatened legal action against all ISPs and email service providers if regulators caught them violating the existing rule. All platforms maintaining the ban are expected to comply with the no crypto-related activities policy strictly.
Like China, Nepal has taken a hardline approach to cryptocurrency, with the government unwilling to embrace the fledgling digital finance industry. However, before the ban, the country was not even among the top Asian nations with crypto adoption, as virtual assets were still a relatively new development among Nepalis.
Before the country’s central bank ban last September, some foreign crypto trading platforms like Paxful were already offering services to Nepalis.
Will This Affect Crypto Adoption?
Meanwhile, before the ban, Nepal was among the top 10 countries worldwide that showed no enthusiasm for embracing digital financial assets. As a result, the latest development will not impact the global crypto adoption rate.
Other countries skeptical of cryptocurrency include China, Morocco, and Algeria. These countries have already pronounced cryptocurrency and its related activities illegal.
However, observers revealed that the ban in Nepal is less effective than the government anticipated, as crypto adoption is on the rise. Per data from on-chain analytics firm, Chainalysis’ Global Crypto Adoption Index 2022, Nepal occupies 16th place in crypto use, ahead of the United Kingdom and Indonesia.
Part of the recent instructions issued to ISPs in Nepal shows that the government indeed knows the ineffectiveness of the ban. The authorities claimed that transactions in virtual currency had been steadily increasing recently.
On a broader scale, the case in Nepal has once again brought up the argument that governments worldwide cannot stop the advancements in digital asset adoption. The view is still relevant considering the rise in China’s crypto transaction activities despite the government’s ban on privately issued virtual currencies.
However, it will be interesting to see how the new policy in Nepal will curb the rate of crypto use in the country.
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