In an effort to counteract an uptick in cryptocurrency-associated criminal conduct, Belarus’s Ministry of Foreign Affairs is advancing plans to prevent its citizens from direct Bitcoin trades.
In an aim to suppress peer-to-peer (P2P) activities in digital assets, notably Bitcoin, Belarus’s foreign affairs ministry is working on altering the legal framework.
On July 2, the ministry communicated via Telegram that it intends to legislate prohibitions on individual involvement in P2P digital asset trading.
An alarming increase in cybercrime domestically is given as the rationale for this move, with the ministry revealing that since the start of 2023, authorities have intercepted 27 citizens involved in “prohibited cryptocurrency trading services”. These illicit operations generated nearly 22 million Belarusian rubles (approximately $8.7 million).
The ministry expressed concern that P2P services in the crypto realm are becoming havens for perpetrators who liquidate and convert stolen assets, and facilitate money transfers for those engaged in illicit schemes.
To curb these underhanded activities, the ministry is considering restrictions on individual P2P exchanges, instead mandating that digital asset transactions be conducted solely through exchanges sanctioned by the Belarus Hi-Tech Park (HTP). The regulatory statement reads:
“We’re initiating legislative adjustments to discourage private crypto trading activities. To ensure transparency and oversight, such financial operations will only be authorized through exchanges recognized by HTP.”
The ministry also has plans to introduce mechanisms resembling foreign currency exchange procedures, which would make the conversion of ill-gotten money unattainable.
“With these proposed regulations, it will no longer be viable for cyber fraudsters to function within Belarus,” the ministry declared.
Despite the declaration from Belarus, many crypto-enthusiasts have expressed skepticism about the government’s ability to effectively enforce a P2P cryptocurrency trading ban. One Twitter commentator posted, “Wishing them luck enforcing that.”
Bitcoin’s founding principle is the P2P exchange, as detailed in the original white paper by its anonymous creator, Satoshi Nakamoto. Proponents like Jan3’s CEO, Samson Mow, claim that implementing a P2P ban is a tough, if not insurmountable, task. Despite China’s complete ban on all crypto transactions for its citizens in 2021, Mow told Cointelegraph in June that a substantial number of users continue to use P2P channels for crypto transactions in the country.
Contrarily, Belarus’s latest announcement seems to contradict its own recent legal progress. Last year, President Alexander Lukashenko approved a decree which openly supported the free movement of digital currencies such as Bitcoin within the nation.