The Ministry of Foreign Affairs in Belarus is working on legal amendments to prohibit peer-to-peer (P2P) transactions involving cryptocurrencies such as Bitcoin. The ministry announced the new legislation, citing a high cybercrime rate in the country. Since January 2023, local prosecutors have cracked down on 27 individuals providing illegal crypto exchange services, with their total illegal revenues amounting to nearly 22 million Belarusian rubles ($8.7 million).
The ministry argues that P2P crypto services are in demand among fraudsters who use them to cash out and convert stolen funds. To combat this illicit activity, individuals will be prohibited from engaging in P2P transactions and will only be allowed to exchange cryptocurrencies through exchanges registered with Belarus Hi-Tech Park (HTP).
The ministry plans to implement a procedure similar to the exchange of foreign currencies, making it difficult to withdraw money obtained from illegal activities. The aim is to discourage information technology fraudsters from operating in Belarus.
However, there are doubts about the government’s ability to effectively ban P2P cryptocurrency trading, as it goes against the original concept of Bitcoin. P2P exchange was a fundamental idea behind Bitcoin, and enforcing a ban on it can be challenging. Similar bans in other countries have faced difficulties, with users finding alternative ways to continue P2P trading.
The move by Belarus is somewhat contradictory to its previous legislation. In 2022, the country’s president signed a decree expressing support for the free circulation of cryptocurrencies like Bitcoin.
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