Bangladesh

Reference: Foreign Exchange Regulation Act, 1947 (from Ministry of Law, Justice and Parliamentary Affairs, Bangladesh)

Money Laundering Prevention Act, 2012 (MLPA): The BB has highlighted the significant risks of money laundering and terrorist financing associated with the anonymity and unregulated nature of cryptocurrencies. While not specifically mentioning "virtual assets," engaging in transactions that facilitate money laundering through any means would fall under this act.

Reference: Money Laundering Prevention Act, 2012 (from Ministry of Law, Justice and Parliamentary Affairs, Bangladesh)

Bangladesh Bank circulars and warnings remain in full regulatory force and are actively enforced, but they are not static or final; they are frequently amended, consolidated and sometimes superseded by newer circulars and legal instruments as the regulatory framework evolves.

FE Circular No. 15 of 2017 (December 24, 2017): This was one of the earliest and most direct prohibitions. The BB warned against dealing in virtual currencies like Bitcoin, stating they are not legal tender, are not approved by the BB, and carrying out transactions with them could lead to violations of FERA and MLPA.

Finding direct official URLs for older BB circulars can be challenging as their website structure changes. However, numerous reputable news outlets and legal firms reported on it extensively. Example reference: Bangladesh Bank warning against virtual currencies

Circular No. 34 (of 2021) on Foreign Exchange Transactions (October 14, 2021): This circular reiterated the ban, explicitly stating that "virtual assets" (including cryptocurrencies like Bitcoin, Ethereum, Ripple, Litecoin) are not legal tender and are not permitted for transaction or exchange within Bangladesh. It also warned about associated risks and legal consequences.

Again, direct official BB URLs can be difficult for specific circulars. Search "Bangladesh Bank Circular 34 virtual assets 2021" for news reports and summaries. Example reference: Bangladesh Bank reiterates warning against virtual currencies

Cryptocurrency Exchanges: Operating an exchange for buying, selling, or trading cryptocurrencies is prohibited.

Custody Providers: Providing custody services for virtual assets is not permitted.

Payment Processors: Engaging in payment processing or facilitating transactions involving cryptocurrencies is prohibited.

Neither a registration nor a licensing regime exists for virtual assets in Bangladesh.

The current approach is one of outright prohibition and warning against engaging in any activities related to cryptocurrencies.

Significant Capital Requirements: To ensure financial stability and protect consumers.

Bangladesh has committed to implementing robust AML/KYC procedures in line with FATF recommendations for VASPs, but remains on the FATF grey list due to ongoing strategic AML/CFT deficiencies.

Local Presence: Requiring a registered entity with a local registered office address in Bangladesh, which does not mandate physical office space.

There is no application process for virtual asset licenses in Bangladesh because such licenses are not issued.

Under Bangladesh’s Money Laundering Prevention Act (MLPA), Section 4, individuals convicted of money laundering are subject to a statutory imprisonment range of 4 to 12 years, with the precise term within that range determined by the court based on the nature, severity, and value of the offense.

Asset forfeiture is a legal process in which authorities confiscate property connected to alleged criminal activity, including assets used in, derived from, or otherwise linked to crime, sometimes through in rem proceedings that do not require a criminal conviction and can extend beyond only the assets directly involved in specific illegal transactions.

Under Indian law, securities still include traditional instruments such as shares, scrips, stocks, bonds, debentures, debenture stock or other marketable securities of a like nature, but the legally recognized scope of “securities” has been expanded by subsequent amendments to also cover additional instruments (e.g., various derivatives and other specified financial products), so that traditional list is no longer a complete standalone definition of securities.

Unit shares, and any instrument declared by the Commission to be a security.

Warnings to Financial Institutions: Bangladesh Bank has repeatedly issued warnings to all banks and financial institutions against dealing in, facilitating, or promoting cryptocurrencies. These warnings serve as an instruction to financial institutions to block transactions related to crypto.

Prohibition on Use and Exchange: Law enforcement and regulatory bodies have acted against individuals and groups involved in unauthorized foreign exchange transactions or money laundering using cryptocurrencies. For instance, there have been reports of arrests for operating illegal crypto exchanges or facilitating crypto transactions that violate the Foreign Exchange Regulation Act, 1947, and the Money Laundering Prevention Act, 2012. These are generally broader criminal charges, not specific securities violations related to crypto.

Preventing Capital Outflow: The government views cryptocurrencies as a potential channel for capital flight and illegal remittances, leading to vigilance and action against such activities.

Bangladesh Bank Circular (December 26, 2017) - Prohibition on Virtual Currencies:

Content: This circular explicitly warned against the use of virtual currencies like Bitcoin, stating they are not legal tender, lack central authority, are prone to money laundering and terrorist financing, and carry risks for users. It urged financial institutions to take necessary measures to prevent transactions involving virtual currencies.

Direct BB URL is often not publicly archived for older circulars in an easily accessible format. However, its content is widely cited by legal firms and news outlets in Bangladesh.

Bangladesh Bank Circular (July 27, 2021) - Reiterating Warnings:

Content: Reaffirmed the position from the 2017 circular, reiterating the prohibition on all forms of virtual currencies/cryptocurrencies and emphasizing the associated risks including money laundering, terrorist financing, and foreign exchange violations. It specifically mentioned penalties under the Money Laundering Prevention Act, 2012, and the Foreign Exchange Regulation Act, 1947.

For BB (brick‑and‑mortar–related) requirements in the BD licensing context, the key governing materials are now directly and publicly accessible via stable, English‑language URLs, and their content is comprehensively documented in those sources.

The Securities and Exchange Ordinance, 1969:

This is the primary legislation governing securities in Bangladesh. While it doesn't mention cryptocurrencies, it would be the foundational law if BSEC were ever to regulate them.

URL (Ministry of Law, Justice and Parliamentary Affairs - Bangladesh):

http://bdlaws.minlaw.gov.bd/act-details-180.html (Bengali version, English version link usually available on the same portal or through legal databases).

General warnings and circulars issued by the Bangladesh Bank (BB) reiterating the illegality and risks.

Criminal investigations into cryptocurrency-related fraud and illegal remittance schemes are active in Bangladesh, but there is insufficient recent evidence to confirm significant arrests of individuals involved.

Regulator Name: Bangladesh Bank (BB)

Entity Targeted: General public, financial institutions, and implicitly, anyone involved in cryptocurrency.

Violation Type: Engaging in cryptocurrency transactions, which is considered illegal under existing foreign exchange regulations (Foreign Exchange Regulation Act, 1947) and anti-money laundering laws (Money Laundering Prevention Act, 2012). BB states crypto carries high risks of money laundering, terror financing, and capital flight.

Penalty Amount: N/A (for a warning), but the underlying laws carry severe penalties (fines, imprisonment, asset forfeiture) for non-compliance.

Date: Multiple reiterations, but consistently maintained. Significant public statements were made in late 2021 and early 2022 and continue periodically. The stance dates back to 2014.

Outcome: Public awareness campaigns, continued illegal status of crypto, discouragement of financial institutions from dealing with crypto. This forms the basis for criminal prosecutions.

Dhaka Tribune (April 2022): https://www.dhakatribune.com/business/2022/04/18/bangladesh-bank-warns-against-cryptocurrencies (Reports on BB's renewed warning)

The Daily Star (October 2021): https://www.thedailystar.net/business/economy/news/bb-reiterates-warning-against-cryptocurrency-2212261 (Reports on BB's circular reiterating the ban)

Regulator Name: Bangladesh Police, Criminal Investigation Department (CID), Rapid Action Battalion (RAB) – primarily law enforcement agencies, not financial regulators in this context.

Entity Targeted: Individuals running illegal multi-level marketing (MLM) schemes using crypto, conducting "digital hundi" (informal remittance) via crypto, or engaging in crypto-related scams.

The October 2022 case was part of a multi-level marketing crypto scam in Bangladesh, but enforcement actions have continued and expanded beyond that date, including CID repatriation of Tk44 crore laundered through the MTFE scam in 2025.

Specific Entity: Individuals, often linked to platforms like "Metaverse Foreign Exchange (MTFE)" or similar fraudulent schemes.

Violation Type: Fraud, money laundering, operating illegal financial schemes, breach of Digital Security Act.

Under the Penal Code, 1860, penalties upon conviction are prescribed by law; for certain offences, enhanced punishment applies after a previous conviction, and specific sentences (e.g., 30 years) are mandated, so penalties are not simply variable but defined by statute.

There were no confirmed arrests in June 2025 related to crypto-based MLM scams specifically in Bangladesh.

Outcome: Arrests, ongoing investigations, disruption of illegal schemes, seizure of assets.

The Business Standard (October 2022): https://www.tbsnews.net/economy/rab-arrests-5-scammers-tk-12cr-crypto-based-mlm-business-514742 (Reports on RAB arrests related to crypto-based MLM)

Dhaka Tribune (August 2023, follow-up on similar schemes): https://www.dhakatribune.com/bangladesh/2023/08/25/mtfe-app-scam-millions-lost-to-crypto-trading-app (Discusses similar widespread crypto scams leading to investigations and potential arrests)

Example Case 2 (Early 2023): Arrests for "digital hundi" (illegal remittance) using cryptocurrency.

Specific Entity: Individuals facilitating illegal cross-border money transfers.

Violation Type: Money laundering, violation of Foreign Exchange Regulation Act, illegal hundi operations.

Penalty Amount: Varies upon conviction.

Date: Incidents reported throughout the period, for example, early 2023.

Outcome: Arrests, disruption of illegal remittance networks.

Source URL: While specific detailed public reports on every crypto hundi arrest are rare with specific "penalty amounts," general news reports frequently mention arrests for digital hundi, some of which involve crypto.

The Financial Express (March 2023): https://thefinancialexpress.com.bd/trade/digital-hundi-a-growing-threat-to-forex-reserve-1678760081 (Discusses the threat of digital hundi, often mentioning crypto as a tool, and law enforcement efforts against it.)

Regulator Name: Bangladesh Telecommunication Regulatory Commission (BTRC)

Entity Targeted: Websites, apps, and platforms (including potentially crypto exchanges) deemed illegal or operating against national interests.

Operating a crypto exchange or other crypto business without the required license is generally treated as a violation of financial and money‑transmission/virtual‑asset regulations (and related AML/consumer‑protection laws), not as a violation of telecommunication laws. Facilitating crypto trading without proper licensing can trigger regulatory enforcement, fines, and even criminal liability under these financial regulatory regimes.

For immigration-related violations, penalties can include monetary civil fines in addition to, or instead of, blocking of access (inadmissibility or denial of entry).

Date: Ongoing, often without specific public announcements for each blocked site, but frequently reported as a general practice.

Outcome: Restricted access to various online platforms, making it harder for Bangladeshi citizens to access crypto services directly.

Source URL: Specific, detailed announcements for crypto platforms blocked by BTRC are rare. However, the general practice of BTRC blocking "illegal" sites is well-documented.

Dhaka Tribune (March 2024, general blocking context): https://www.dhakatribune.com/bangladesh/2024/03/17/btrc-blocks-over-3000-websites-apps-in-two-months (Reports on BTRC's general blocking activities; while not crypto-specific, it illustrates the mechanism through which crypto sites would also be blocked.)

Entity Targeted: General public, financial institutions, and implicitly, anyone involved in cryptocurrency. Violation Type: Engaging in cryptocurrency transactions, which is considered illegal under existing foreign exchange regulations (Foreign Exchange Regulation Act, 1947) and anti-money laundering laws (Money Laundering Prevention Act, 2012). BB states crypto carries high risks of money laundering, terror financing, and capital flight. Penalty Amount: N/A (for a warning), but the underlying laws carry severe penalties (fines, imprisonment, asset forfeiture) for non-compliance. Outcome: Public awareness campaigns, continued illegal status of crypto, discouragement of financial institutions from dealing with crypto. This forms the basis for criminal prosecutions.

Entity Targeted: Individuals running illegal multi-level marketing (MLM) schemes using crypto, conducting "digital hundi" (informal remittance) via crypto, or engaging in crypto-related scams. Violation Type: Fraud, money laundering, operating illegal financial schemes, breach of Digital Security Act. Penalty Amount: Varies upon conviction (fines and imprisonment). Asset seizures occur during arrest. Specific penalty amounts are not publicly available at the time of arrest or often even immediately after conviction. Outcome: Arrests, ongoing investigations, disruption of illegal schemes, seizure of assets. Violation Type: Money laundering, violation of Foreign Exchange Regulation Act, illegal hundi operations. Penalty Amount: Varies upon conviction. Outcome: Arrests, disruption of illegal remittance networks.

Entity Targeted: Websites, apps, and platforms (including potentially crypto exchanges) deemed illegal or operating against national interests. Violation Type: Operating without license, facilitating illegal financial activities (which crypto trading falls under), or other violations of telecommunication laws. Penalty Amount: N/A (penalty is the blocking of access). Outcome: Restricted access to various online platforms, making it harder for Bangladeshi citizens to access crypto services directly.

Public awareness campaigns exist in Bangladesh, but the illegal status of cryptocurrencies is evolving toward regulatory consideration, reducing outright discouragement of financial institutions and altering the prosecutorial landscape.

Penalties for fraud, money laundering, and illegal financial schemes under Bangladesh's Digital Security Act now include specific provisions such as up to 10 years' imprisonment and fines of up to BDT50 million (approximately US$405,500) for offenses like online gambling under the Gambling Prevention Act of 2026.

Outcome: Arrests, ongoing investigations, disruption of illegal schemes, seizure of assets.

Violation Type: Money laundering, violation of Foreign Exchange Regulation Act, illegal hundi operations. Penalty Amount: Varies upon conviction.

Outcome: Arrests, disruption of illegal remittance networks.

Outcome: Restricted access to various online platforms, making it harder for Bangladeshi citizens to access crypto services directly.