In an attempt to combat fraud, Belarus is looking to put an end to peer-to-peer crypto exchanges.
“Crypto-Friendly” Belarus Cracking Down?In an effort to combat fraud and tighten its grip on cryptocurrency transactions, the Belarusian government is contemplating a ban on peer-to-peer (P2P) crypto trading. The proposed crackdown aims to protect consumers and prevent illegal activities within the cryptocurrency market.
P2P crypto trading refers to the exchange of cryptocurrency between two individuals directly, without the involvement of a third party like a crypto exchange.
Belarus, known for its relatively lenient stance on cryptocurrency, embraced blockchain technology and even legalized cryptocurrency mining and exchange activities in 2017. It has been called one of the most crypto-friendly countries in the world, as it offers a tax exemption for individuals and businesses conducting crypto transactions. A year ago, President Lukashenko even signed a decree to ratify the free circulation of cryptocurrencies in the country.
Trying To Curb Money LaunderingThe country’s Ministry of Internal Affairs released a statement on Sunday revealing that malicious actors were using the P2P crypto services to transact dirty funds.
The statement read,
“Since the beginning of the year, employees of the cybercrime counteraction units have stopped the activities of 27 citizens who provide illegal cryptocurrency exchange services. Their total illegal income amounted to almost 22 million rubles ($8.7 million).”
As a result, the proposed ban seeks to restrict the direct exchange of cryptocurrencies between individuals without any intermediary platform. By eliminating P2P trading, Belarus hopes to curb fraudulent schemes and money laundering attempts that have been prevalent in the country's crypto space.
The notice also explained that citizens would be able to conduct such financial transactions only through the registered exchanges in order to promote transparency and government control.
How Will Ban Affect Belarus’s Crypto Landscape?The decision comes amidst rising instances of fraud within the country's cryptocurrency sector. Scammers have taken advantage of the anonymous nature of P2P transactions to carry out various fraudulent schemes, defrauding unsuspecting individuals of their hard-earned money.
Although critics have argued that a blanket ban on P2P crypto trading may stifle innovation and hinder the growth of the industry, it is interesting to note that the country has recently renewed its crypto tax exemption law to be in effect till 2025.
It is worth noting that the proposed ban on P2P crypto trading in Belarus is still in the discussion stage. The government is expected to consult with industry experts and stakeholders to carefully weigh the potential consequences before finalizing any regulatory measures.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
