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Expert Opinion

Why have countries banned cryptocurrencies?

Every newbie who is trying to explore blockchain industry keeps wondering “If cryptocurrency is good then why do countries keep banning it?”. A lot of people have given their opinion on this matter and laid down the path to more questions. I am here to try and provide a quick and straightforward answer. Cryptocurrencies are being banned because of two crucial groups in every country.

First one, Security departments. Everyone is aware of the fact that using cryptocurrencies has its dark side. A lot of scams have exposed recently, and now investors are scared to invest their money into genuine projects which have the potential to be developed into a great business. The departments which handle the security of the country are worried about the anonymity of these platforms. Experts have suggested that cryptocurrencies can be used for illegal transactions which in turn is the money used to buy weapons, drugs or human trafficking. Some hackers use this anonymity to ask for ransoms such an example was the NHS case.

The second one, The middleman – When transactions become decentralised the middleman loses his share of the fee. I am talking about banks who have worked for centuries as the middleman for transactions by taking a certain amount of fee. The banks have taken centuries to build their trust among people but after the financial crisis of 2008. People looked at other options that were available in the market. The blockchain industry looked like the perfect replacement for a trusted middleman. Every transaction is securely linked and accessible to everyone to verify a change, unlike centralised banks. This makes them unnecessary for transactions. This is the reason they are motivated to ban cryptocurrencies.

It is imperative to understand that by banning them in a few countries will not stop the change, in fact, it will create a space for a black market. They can be declared illegal in a few countries, but they can’t be killed due to their decentralised nature. To kill cryptocurrencies, every country in the world needs to ban them which does not look like a possibility anywhere in the near future.

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