Cryptocurrency ban: can states ban cryptocurrency completely?

Banning of cryptocurrency: can states ban cryptocurrency completely

The topic of the prohibition of cryptocurrency by states for a very long time has been discussed in the information space, but despite all skeptical forecasts, cryptocurrency only continues to grow. How realistic is a cryptocurrency ban and is it possible at all? We will describe in this article.

How feasible is a complete cryptocurrency ban?

It so happened that completely different people constantly rumor about the ban on cryptocurrency, especially in revealing comments on the Internet. Say, all this is fraud, digital money will burst and undermine the economy. They are unsuitable for use, and so on. They will soon be completely banned in general.

Material money can be withdrawn, it is possible to stop the process of emission, to prohibit the equipment for emission, since not every hundredth person has it. Cryptocurrency is virtually impossible to remove in a violent way and to stop their emission. You need to take computers away from all people.

Centralized currencies can also be destroyed or radically altered, since this would require influencing the centralization authorities. Decentralized currencies can not be destroyed, altered and controlled in this way, because it is impossible to influence all cryptocurrency holders at once.

You need to attend to, firstly, the creation of regulations, and secondly, the creation of conditions for the implementation of the provisions of these acts to ban cryptocurrency.

The documents define cryptocurrency and say that operations with it are prohibited. The reasons for this ban are also recorded. In some cases, financing of terrorism and extremist activities is mentioned, in other compilers focus on the fact that cryptocurrencies allow to avoid taxation, in the third, the ban is justified by the need to support the national currency, etc.

If we are talking about finances, cryptocurrencies often fall under the definition, which means an already prohibited phenomenon. For example, the use of money substitutes in a country can be prohibited and punishable. Digital money is included in the list of examples of “money substitutes”, transformed into one of their varieties and find themselves under all prohibitions that are imposed on “substitutes”.

The information is a bit more complicated. Cryptocurrencies can be recognized as information, since they are an information code. They receive the status of illegal information and are subject to the law, which prohibits its distribution and propaganda. If cryptocurrencies receive the status of illegal money or a similar phenomenon, then the distribution of information about this phenomenon is prohibited.

There are orders to terminate the activities of any organizations that are related to cryptocurrency. These are exchanges, exchangers, shops, etc. Citizens who continue to provide services and use them are violators of the law. They are supposed to be fined, confined, imprisoned, etc. The same applies to individuals who, for example, sell their property to someone for bitcoins.

There are orders banning local and foreign sites related to cryptocurrencies – exchanges, exchangers, cryptocurrency media, etc. Access to them is blocked at the level of providers who can not fail to execute the order, because otherwise they are violators of the law and distributors of prohibited information.

A separate story is mining. Miners, depending on the laws and interpretations, can be called extremists, scammers, and so on. They were compared with counterfeiters and gold washers at different times. With the prohibition of cryptocurrency, miners face the seizure of equipment, the seizure of property, administrative or criminal penalties, etc.

Recently, the Chinese authorities have concluded that it would be nice to limit electricity supply to miners, otherwise they spend too much. This option can also be noted by states that wish to prohibit their cryptocurrency.

Law enforcement agencies have virtually no opportunity even to find a person who has made some efforts to ensure this anonymity. Moreover, the efforts are very insignificant even for an ordinary user with minimal technical literacy.

Obviously, if countries start to prohibit crypto-money, the number of currencies that allow them to bypass will increase dramatically. Theoretically, cryptocurrencies allow to implement almost any currently known cryptographic algorithm and their appearance is a matter of time and needs.

Actually, there are already currencies that thoroughly confuse the trail – Monero, Spectrecoin, Verge, etc. To detect users in each case will require a long and painstaking work of highly skilled professionals – and it is not a fact that it will give the result.

There can be hundreds of thousands of users and 80% will use crypto-money not to finance terrorism, but to buy a pair of T-shirts and a ticket to the sea. Even ardent opponents of cryptocurrency will not spend the work of single experts on these grief infringers.

Law enforcement agencies in most countries, even with specialists, will not cope with all, focusing on major offenders and leaving alone the harmless, which are the majority. This majority will quietly use cryptocurrencies and will not blow, so that it will be impossible to talk about a complete ban of this money in the country.

Is it possible to simply ban cryptocurrency websites?

The resource will simply change the location in response. If earlier it, say, was registered in Russia and was located on Russian servers, the owner can register it in Germany and transfer it to Polish servers.

However, this circumstance rarely stops people, even when it comes to the usual content, without which a person can safely do. Moreover, it will not stop those for whom cryptocurrencies are a means of earning. There are VPN, Tor and other features to pretend that a user physically residing in a country where cryptocurrency is prohibited, does not perform any illegal actions.

Not to mention the fact that this lowers the rating of the current government and in the case of applying too tough measures to violators, as well as in the case of too strict prohibitions, can lead to political and social unrest. Naturally, no one is interested in such consequences.

However, for example, it is impossible to pay in any other currency in Russia, except the Russian ruble. This does not interfere with the use of cards in dollars or euros in stores, which is typical, without any manual conversion of funds. Currencies are converted into rubles when paid, the cardholder may lose only a small amount due to an unfavorable exchange rate, but he does not violate the law in any way. Running a similar mechanism with cryptocurrency is not at all difficult.

The owners of the crypto exchanger circumvented the requirement for a license from the currency exchangers in Thailand at one time, adding to the user agreement a clause stating that users undertake not to exchange the cryptocurrency that they received through the exchanger for foreign currency.

Considering that more and more representatives of the electorate are beginning to be interested in cryptocurrencies, sooner or later, officials find themselves in a situation where it is impossible to sit on two chairs and have to choose – either openly prohibit cryptocurrencies, or allow.

As of today, more and more attention is being paid to finding constructive ways of coexisting with a growing cryptocurrency market – for several reasons.

There is definitely a tendency to recognize cryptocurrency by the majority of states, including advanced ones. Those who have not yet decided on the status of digital money, are largely guided by them.

It is not known how many countries will eventually resolve them and how many will prohibit them, but so far one cryptocurrency is clearly spreading, which means it’s impossible to talk about a global ban on them.