Cryptocurrency has become one of the most talked-about technologies globally over the past decade. From Bitcoin to Ethereum, digital currencies promise huge profits, technological innovation, and a new way of handling money. However, in Nepal, the situation is very different: cryptocurrency is illegal, and the landscape is filled with facts, rumors, and serious crimes.
This article explores cryptocurrency in Nepal, its popularity, common misconceptions, recent crypto-related crimes, and the reasons behind the country’s strict ban.
What Is Cryptocurrency?
Cryptocurrency is digital money that exists only in electronic form. Unlike Nepalese rupees, it is not issued or controlled by any government or central bank. Instead, cryptocurrencies operate on blockchain technology, a decentralized public ledger that records every transaction securely and permanently.
Common examples include Bitcoin, Ethereum, and USDT. Cryptocurrencies can be used for online payments, investments, and innovative applications like smart contracts and decentralized apps.
Why Cryptocurrency Attracts Attention in Nepal
Even though crypto is banned, many Nepalis are curious about it. There are several reasons for this interest:
- High Profit Potential: Early investors in Bitcoin or Ethereum have made substantial gains.
- Fast Global Transactions: Cryptocurrencies allow near-instant transfers without banks or intermediaries.
- Technological Appeal: Blockchain is seen as the “future” of finance and digital infrastructure.
- Social Media Hype: Online stories and promotions make cryptocurrency appear exciting and profitable.
Despite these attractions, it is important to note that buying, selling, or trading crypto in Nepal is illegal.
Common Rumors and Misconceptions
- “Holding crypto is legal.” In reality, any trading or exchanging of cryptocurrencies is prohibited under Nepali law.
- “Crypto is fully anonymous.” While wallet IDs are pseudonymous, blockchain transactions are publicly recorded.
- “Crypto profits are guaranteed.” Cryptocurrency is highly volatile, and many people lose money instead of gaining it.
- “Crypto jobs online are safe and easy.” Many online platforms promising earnings through crypto are scams.
Why Nepal Banned Cryptocurrency
- Fraud and Scams: Unregulated trading exposes citizens to high financial risk.
- Lack of Legal Framework: Nepal currently has no laws to regulate cryptocurrency or protect users.
- Economic Risks: Authorities fear uncontrolled crypto trading could destabilize the national economy.
- Cybersecurity Concerns: Large-scale digital transactions can increase vulnerability to hacking and money laundering.
Because of these reasons, buying, selling, or trading cryptocurrency is illegal in Nepal.
Recent Cryptocurrency-Related Crimes in Nepal
- Major Crypto and Romance Scam Ring (2025): Nepal Police’s Central Investigation Bureau arrested 52 people, including six Chinese nationals, for running fake dating apps linked to illegal cryptocurrency trading. Victims were lured into unauthorized crypto deals, and police seized cash, phones, and laptops connected to the operation.
- Crypto-Linked Money Laundering (2025): Two men were arrested for operating a crypto-based money laundering ring involving transactions worth nearly Rs 263 million. Reports indicate that young Nepalis were manipulated into acting as intermediaries for laundering funds.
- Illegal Crypto and Online Gambling Arrests (Pokhara): Five youths were arrested for illegal crypto trading and online gambling, conducting transactions worth approximately Rs 300 million using messaging apps.
- Hundi and Crypto Transactions: Two Indian nationals were arrested in Kathmandu for conducting illegal hundi transactions combined with cryptocurrency trading.
- Robbery Involving a Crypto Trader: In one unusual case, three policemen and others were arrested for robbing a known crypto trader, demonstrating that even law enforcement can become entangled in illegal crypto activity.
Implications of Cryptocurrency in Nepal
Because cryptocurrency is illegal, most activities occur underground, leading to:
- Scams disguised as “work-from-home” crypto jobs
- Fake investment platforms targeting unsuspecting citizens
- Money laundering and illegal foreign transactions
Police increasingly monitor and prosecute such activities, but the underground nature of crypto makes enforcement challenging.
Legal Consequences
- Conducting unauthorized cryptocurrency transactions can result in arrest, fines, and imprisonment.
- Authorities actively investigate crypto-related fraud and illegal trading operations.
Conclusion
Cryptocurrency is a global phenomenon, offering opportunities and technological innovation. In Nepal, however, it remains illegal due to high risks of fraud, money laundering, and economic instability. Recent crimes in Nepal highlight the dangers of underground crypto activity, especially for young people attracted by online promises of easy profits.
Until there is a clear legal framework, Nepalis should remain cautious and avoid participating in cryptocurrency trading or investment.