The Nepal Rastra Bank has imposed a complete ban on cryptocurrency, categorizing its use as a criminal offense under Section 262 (Ka) of the Muluki Criminal Code 2074. Illegal cryptocurrency trading and money laundering issues are increasing in Nepal, with many young individuals unknowingly becoming recruits for criminal gangs. While cryptocurrencies are legal in 45 out of the world’s 75 leading economies, they are entirely prohibited in 10 countries, including Nepal, highlighting the need for Nepal to consider regulatory measures.
Throughout human history, mediums of exchange have evolved over time. Starting from barter trade, this progression moved through metal coins and paper notes, leading to today’s intangible digital currencies. The global economy is rapidly digitalizing, so much so that technologies once considered futuristic are now integral to our everyday lives. Where previously carrying cash was essential for shopping, today we complete nearly all financial transactions merely by scanning QR codes.
When discussing cryptocurrency, it is crucial to understand blockchain technology, which forms its backbone. Blockchain is a shared and secure ledger operating on the internet, where every transaction is simultaneously updated across thousands of computers worldwide. These computers are known as nodes in technological terms. In this system, data is cryptographically bound, ensuring that once information is recorded on the ledger, no one can delete or alter it.
Recent legal measures taken in Nepal to control cryptocurrency trading have been notably stringent. The latest amendment to Section 262 (Ka) of the Muluki Criminal Code 2074 (effective from 30th Baishakh 2081) signifies that this issue is no longer solely under the Nepal Rastra Bank’s jurisdiction but has firmly come under the scope of criminal law, reflecting the state’s serious stance on the matter.
