KATHMANDU: Despite a blanket ban on cryptocurrency trading in Nepal, thousands of Nepalis are actively engaged in crypto transactions, sidestepping regulations through creative loopholes and digital wallets.
The country’s central bank, Nepal Rastra Bank (NRB), has repeatedly declared that crypto trading and mining are illegal. Yet, the crypto craze continues to thrive.
Nepal does not have any specific laws governing cryptocurrency. The NRB has issued several public notices prohibiting crypto trading and has even blocked access to popular exchange platforms.
However, this has not deterred traders who use international crypto platforms like Binance, Coinbase, and CoinMarketCap.
A study of Binance — one of the world’s largest crypto exchange sites — shows that thousands of Nepalis are trading daily through these platforms.
Since direct crypto transactions via the formal banking system are banned, traders have found alternative methods.
Many use mobile wallets like eSewa, Khalti, and IME Pay to buy and sell cryptocurrencies through Binance’s Peer-to-Peer (P2P) service. In this model, users connect directly, exchanging crypto assets while transferring funds in Nepalese rupees through mobile wallets or bank accounts.
The anonymity of crypto platforms adds a layer of security for traders, who often avoid using their real names until the point of transaction. However, this also opens the door to scams.
Traders face risks such as receiving no payment after selling or not getting crypto despite making an advance payment.
While the NRB bans crypto transactions, its oversight remains limited.
Dilliram Pokharel, the NRB’s co-spokesperson, acknowledges the lack of detailed monitoring and defers enforcement to agencies like the Cyber Bureau of the Nepal Police.
“The central bank prohibits crypto trading, but the Cyber Bureau is responsible for investigations and enforcement,” Pokharel said.
However, investigations are few and far between. Deepak Raj Awasthi, spokesperson for the Cyber Bureau, cited a lack of manpower for the bureau’s inability to pursue crypto-related cases rigorously.
The ongoing crypto trade in Nepal highlights the growing challenge for regulators. While the government attempts to clamp down on exchanges and platforms, traders are staying ahead with technology and innovation.
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