The Ministry of Foreign Affairs (MFA) of Belarus has announced its intention to introduce legal amendments that would ban peer-to-peer (P2P) transactions involving cryptocurrencies like Bitcoin (BTC). Citing a high cybercrime rate in the country, the MFA stated that it had already taken action against 27 individuals involved in providing illegal crypto exchange services, with their combined illegal revenues totaling approximately $8.7 million.
According to the MFA, P2P crypto services are popular among fraudsters who use them to cash out and convert stolen funds, ultimately transferring money to organizers or participants in criminal activities. To combat this illicit activity, Belarus plans to restrict individuals from engaging in P2P transactions and will only allow crypto exchanges registered with Belarus Hi-Tech Park (HTP) to facilitate cryptocurrency conversions. The aim is to enhance transparency and control over financial transactions by channeling them through authorized exchanges.
In addition, the Belarusian government intends to implement practices similar to those used for foreign currency exchanges, making it challenging for perpetrators to withdraw funds acquired through illegal means. By creating such conditions, the MFA believes it will discourage information technology fraudsters from operating within the country.
However, some cryptocurrency enthusiasts have expressed skepticism regarding the effectiveness of banning P2P cryptocurrency trading. Enforcing such a ban may prove difficult, as observed by one commenter on Twitter. Similar challenges have been faced in China, where users continue to utilize P2P channels for crypto exchanges despite the nationwide prohibition on crypto transactions.
This move by Belarus appears contradictory to its previous stance on cryptocurrency regulations. In 2022, Belarusian President Alexander Lukashenko signed a decree expressing formal support for the free circulation of cryptocurrencies, including Bitcoin.
As the country aims to combat rising crypto-related crimes, the proposed prohibition on P2P cryptocurrency transactions reflects Belarus’ commitment to enhancing cybersecurity and preventing fraudulent activities. The success of this ban, however, remains uncertain, considering the decentralized nature of cryptocurrencies and the challenges already faced by other jurisdictions in implementing similar restrictions.