Crypto Watchdog Says Bitcoin Trading is Illegal in Saudi Arabia

Cryptocurrency trading is Illegal in Saudi Arabia

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A task force formed by the Saudi Arabian government to look into the issue of cryptocurrency has stated that crypto trading is illegal in the country. The committee through a statement issued on Sunday warned citizens’ against trading in digital currencies because of the negative impacts and high risks associated with them. The statement added that the fact that digital currencies cannot be supervised by national governments make them very uncontrollable and dangerous.

The committee also clarified that:

“The committee maintains that cryptocurrencies such as Bitcoin are illegal in the Kingdom and no institution or parties are allowed to trade them.”

The statement from the committee, however, did not state the consequences of trading in digital currencies. The committee was brought into existence by 5 of the Middle East nation’s watchdog which included the Saudi Arabian Monetary authority, Capital Market Authority, and the country’s de facto bank.

It’s tasked to deal with unauthorized securities activities in the securities market as well as notifying agencies and regulatory bodies of any cryptocurrency activities so as to reduce the exposure of the same to the public. Digital currencies have been associated with money laundering as well as illegal activities and that could be one of the reasons the committee is terming them as illegal. Digital currencies are fully decentralized meaning that they cannot be controlled by any national government or even a centralized institution.

One other big challenge to this market has been the volatility nature of the currency. Cryptocurrencies are unpredictable and their prices change very fast. A good example is Bitcoin which was trading around $20,000 in December but has dropped to trade below the $7,000 mark at the moment.

Saudi Arabian Prince Al-Waleed bin Talal in December 2017 compared Bitcoin to Enron an American energy company which collapsed after it was found to have massive accounting fraud. Saudi Arabia is following the footsteps of China which banned the trading of Bitcoin in 2017. Vietnam too is working to ban the digital currency. In fact, Vietnam has already banned the importation of Bitcoin Mining devices in order to try and control the cryptocurrency market.

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