The Belarusian Ministry of Foreign Affairs is working on legal amendments prohibiting peer-to-peer (P2P) transactions in cryptocurrencies like Bitcoin (BTC).
On July 2, the ministry issued an official announcement on Telegram about new legislation that would ban P2P crypto exchange for individuals.
The authority cited a high cybercrime rate in Belarus, stating that local prosecutors have suppressed the activity of 27 citizens providing “illegal crypto exchange services” since January 2023. Their total illegal revenues amounted to nearly 22 million Belarusian rubles ($8.7 million).
The ministry argued that crypto P2P services are “in demand among fraudsters who cash out and convert stolen funds and transfer money to organizers or participants in criminal schemes.”
To eliminate such illicit activity, the ministry will prohibit individuals from P2P and will only allow them to exchange crypto via exchanges registered with Belarus Hi-Tech Park (HTP). The regulator stated:
“The MFA is working on legislative innovations that prohibit crypto exchange transactions between individuals. For transparency and control, citizens will be allowed to conduct such financial transactions only through the HTP exchanges.”
The authority also noted that it plans to implement a practice similar to the procedure for exchanging foreign currencies, which will make it “impossible to withdraw money obtained from illegal activity.”
“Under such conditions, it will simply become unprofitable for information technology fraudsters to operate in Belarus,” the ministry wrote.
In response to the news from Belarus, many cryptocurrency enthusiasts have questioned the government’s ability to ban P2P cryptocurrency trading. “Good luck enforcing it,” one crypto observer said on Twitter.
P2P exchange is the original idea of Bitcoin, as written by anonymous BTC creator Satoshi Nakamoto in its white paper. According to Bitcoin advocates like Jan3 CEO Samson Mow, banning P2P is not an easy task, if not impossible. The exec told Cointelegraph in June that many users in China still use P2P channels to exchange their crypto despite the country banning all crypto transactions for users in 2021.
The latest news from Belarus is somewhat contrary to legislation Belarus has passed in recent years. In 2022, Belarusian President Alexander Lukashenko signed a decree affirming the country’s formal support of the free circulation of cryptocurrencies like Bitcoin.