Let’s face it. Bitcoin is one of the most misunderstood technological innovations of the 21st century. It has the ability to function as a global currency, making it easy to send and receive money from anywhere in the world within minutes. But much of contemporary society doesn’t think of Bitcoin as a means to facilitate international transactions––they still think of it as a way to finance illegal activities. This, in turn, perpetuates the image of Bitcoin (and cryptocurrency as a whole) being used by criminals, making it harder for us to achieve widespread crypto adoption.
Even worse, Bitcoin draws unnecessary flack because of its cowboy reputation. Lawmakers around the world, many of whom don’t even completely understand how cryptocurrency works, associate Bitcoin and other coins with illicit activities and want to ban it as a result. As of right now, only a handful of countries have put the squeeze on Bitcoin. Those countries are:
- China: Banks and financial institutions, including payment processors, are banned from dealing in Bitcoin.
- Russia: It’s against the law to use Bitcoin to pay for goods and services.
- Vietnam: The Vietnamese government doesn’t recognize Bitcoin as a legitimate payment method, but they’ve yet to truly clam down on its usage.
- Bolivia, Colombia, and Ecuador: Bitcoin and other cryptocurrencies are completely banned.
While there are a number of countries that have recognized the potential Bitcoin and other cryptocurrencies have, there are still a few problems standing between Bitcoin and mainstream adoption. Here are some reasons why some countries would want to ban Bitcoin:
- It can be used to launder money and evade taxes.
- Bitcoin can be used to fund criminal activities, including sending money to terrorist organizations.
- Bitcoin and other cryptocurrencies have been instrumental in various scams, like fake ICOs, Ponzi schemes, and fraudulent cryptocurrency investment funds.
These are obviously problems that need to be addressed if we ever want to lay the groundwork for Bitcoin becoming a truly global currency. But Bitcoin’s ability to circumvent government restrictions isn’t the only reason many countries would like to put it on the chopping block. It also cuts out the need for middleman institutions that facilitate international transactions. While that’s not a bad thing for us, it’s not something most banks are thrilled about. Especially since Bitcoin is decentralized, making it significantly harder to manipulate than local currency.
What’s the Solution?
There’s no denying that Bitcoin has a shady past. Because of this, it’s completely reasonable to want stricter crypto regulations to protect people and prevent money from falling into the hands of criminals, terrorist groups, and rogue states like North Korea.
However, there are just as many benefits that come with embracing Bitcoin. Not only does it make it easier for everyone around the world to participate in the global economy, it also creates a culture of accountability by allowing people to track transactions from start to finish. For this reason, governments should be using Bitcoin to fight corruption, rather than banning it.