Bangladesh's Strict Crypto Stance Persists Despite Underground Adoption

Bangladesh maintains a strict stance on cryptocurrency, with the Bangladesh Bank issuing multiple warnings since 2014 regarding money laundering, terrorist financing, and financial instability. Despite the absence of an official law explicitly banning cryptocurrency, the country's regulatory bodies have made it clear that the use of crypto is strongly discouraged. This stance has created a challenging environment for investors, businesses, and users who are interested in digital finance.

The regulatory landscape in Bangladesh is shaped by several key bodies, including the Bangladesh Bank, the Ministry of Finance, and the Financial Intelligence Unit (FIU). The Bangladesh Bank, as the central bank, oversees all financial activities and has issued warnings against the use of cryptocurrency. The Ministry of Finance influences financial policy and could potentially lead future crypto laws. The FIU monitors the money laundering risks associated with crypto, ensuring that any illicit activities are detected and addressed.

Historically, Bangladesh's relationship with cryptocurrency has been cautious. The Bangladesh Bank released its first statement against Bitcoin usage in 2014, followed by warnings in 2016 about how using cryptocurrency could violate important laws from 1947 and 2012. In 2020, the country released its National Blockchain Strategy, recognizing blockchain as essential for its digital future. However, regulatory confusion persists, and the legal status of crypto ownership remains unclear as of 2025, with the Bangladesh Bank stating that crypto lacks official recognition.

The regulatory framework in Bangladesh is characterized by a lack of official licensing and registration for crypto businesses. Running such platforms is prosecuted under existing finance and anti-money laundering laws, making crypto exchanges, exchanges, and brokers illegal. The Bangladesh Bank does not monitor or enforce KYC rules, but international platforms like Binance and Bybit enforce these rules on their platforms. Local crypto use is frequently carried out via peer-to-peer (P2P) networks, which are difficult to regulate due to their decentralized nature.

Currently, there are no specific tax laws regarding cryptocurrency in Bangladesh. The National Board of Revenue (NBR) has not issued any framework for taxing crypto transactions or holdings, leaving the tax status of cryptocurrency unclear. Additionally, activities such as ICOs or STOs are not allowed or regulated, and there is no legal framework under which token sales or blockchain fundraising can be launched in the country.

Bangladesh has adopted an extremely formal approach to cryptocurrency usage, with the central bank repeatedly warning that trading or using crypto is against the laws. Crypto mining is implicitly discouraged, with the risk of being sued by those operating mining operations. The government has shown interest in blockchain technology through its National Blockchain Strategy, which acknowledges blockchain’s future role in government services. In 2022, the Bangladesh Bank began exploring the concept of a Central Bank Digital Currency (CBDC) to aid digital payments.

Despite the restrictive approach to cryptocurrency, Bangladesh is embracing the digital age by introducing fintech. The government is looking at a regulatory sandbox for digital finance startups, which will ultimately apply to blockchain-based applications. Although the use of crypto is restricted, unofficial P2P crypto transactions are common, especially for remittances. The National Blockchain Strategy aims to use the technology in government sectors for land records, identity systems, and e-governance, without discussing cryptocurrencies.

One of the notable challenges in Bangladesh's approach to cryptocurrency is the inconsistent regulation. The country has not had a clear regulatory framework, and it continues to put no clear linear regulation on the table regarding whether crypto trading is illegal, unregulated, or simply discouraged. Enforcement is difficult because crypto is decentralized in nature, and P2P trading platforms are on the rise. Even with warnings, the country was ranked 17th in the world regarding crypto adoption in 2023.

Public perception of cryptocurrency in Bangladesh is mixed. Government messaging is negative, while tech-savvy youth and entrepreneurs view crypto as a tool for financial inclusion and wealth protection in an environment of banking limitations. Recent developments include the start of CBDC feasibility studies by the Bangladesh Bank in 2022 and the early beta phase of the regulatory sandbox for fintech growth. Although officially opposed, underground crypto activity has grown.

Looking ahead, Bangladesh may stay cautious and focus more on CBDCs and blockchain-related infrastructure rather than public crypto usage. With global pressure and regional competition from crypto-friendly neighbors, future regulations could come to pass. Should crypto adoption continue to increase across South Asia, Bangladesh’s approach will affect both digital competitiveness and the capacity to entice tech investment.

Currently, Bangladesh has a restrictive crypto policy, but underground adoption and innovation forces are accruing. Although there remains ongoing CBDC exploration and the integration of blockchain with it, the future presents itself slowly but surely in the direction of regulated digital finance. Knowing this unstable situation is important for investors and businesses; that is a crypto environment to keep an eye on — particularly as the regulatory changes are likely to come soon.