Belarus, Europe's last dictatorship, is increasing its control over cryptocurrency trading. The government plans to ban individuals from trading cryptocurrencies, claiming concerns about criminal fraud. But, it will allow transactions via authorized exchanges in the Belarus Hi-Tech Park (HTP).
The HTP is a tech hub located in Minsk, the country's capital. It operates under extraterritoriality, which means it can enforce its rules beyond its physical borders. This rule allows both domestic and foreign companies to register and operate under HTP's jurisdiction.
The government hopes that stricter rules will deter IT fraudsters. This is due to the similarities between these new rules and foreign currency exchange procedures. It would make it hard to withdraw money gained through crime.
Since 2017, Belarus has implemented regulations for cryptocurrencies, with Currency.com being the sole local crypto exchange in the country. This new law adds to a series of measures that have made Belarus the least economically free country in Europe. The Heritage Foundation ranks it 145 out of 176 countries globally.
In the past, the government has raised concerns over digital privacy and economic surveillance. In 2020, it shut down the internet following widespread protests over a disputed election. As a response, many citizens turned to cryptocurrencies and VPNs to avoid monitoring.
Despite the government's actions, cryptocurrency usage in Belarus has risen. The country ranks 25th on the Crypto Adoption Index by Chainalysis. However, this could change due to the new rules.
President Alexander Lukashenko has said that he wants to use China as a model for controlling the digital economy. The government is expected to form a new body to regulate technology. This move could lead to stricter control over digital transactions in Belarus.
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