Crypto in Bangladesh: What the Law Says vs What People Actually Do

Bangladesh Bank has told the public not to touch crypto for more than a decade. Millions of Bangladeshis use it anyway. The space between those two facts is where the real story sits.

On paper, Bangladesh is one of the strictest crypto jurisdictions in Asia. No exchange is licensed. Banks, bKash and Nagad are barred from facilitating trades. Since 2014, Bangladesh Bank has issued notice after notice saying crypto deals can break the country’s foreign exchange and money laundering laws.

On the ground, the picture is almost the opposite. Freelancers get paid in USDT. Students trade Bitcoin on their phones. Taka moves through mobile wallets to strangers on Binance’s peer-to-peer market, and stablecoins arrive in return. Chainalysis placed Bangladesh 13th of 151 countries in its 2025 Global Crypto Adoption Index.

This Dhaka Debates explainer lays out what the law actually says, what people actually do, where that gap has already caused harm, and the choice policymakers now face.

Quick facts

Question	Short answer
Is there a crypto law in Bangladesh?	No. Bangladesh Bank relies on FERA 1947 and the Money Laundering Prevention Act 2012
Can banks, bKash or Nagad handle crypto?	No, banned by a 2022 Bangladesh Bank circular
Is owning crypto a crime?	Not clearly. A 2021 Bangladesh Bank letter said it does not appear to be one
How do people buy it?	Mostly P2P on Binance, paying sellers with taka
Global usage rank	13th of 151 countries (Chainalysis, 2025)
Any licensed exchange?	None

What the law says

Bangladesh has no crypto law. Instead, Bangladesh Bank uses two older laws to say crypto is not allowed.

Those laws are the Foreign Exchange Regulation Act, 1947 (FERA) and the Money Laundering Prevention Act, 2012. Neither mentions cryptocurrency. Bangladesh Bank’s position is that buying crypto with taka is an unapproved foreign-exchange transaction, and that untraceable value transfer invites money-laundering and terror-financing charges.

The main rule today is FE Circular No. 24 of 15 September 2022. It says three things:

• Virtual currencies are not recognised as “currency” under FERA.
• Any transaction in, from or to Bangladesh to obtain virtual assets is not permitted.
• Banks, NBFIs and mobile financial services such as bKash and Nagad may not facilitate crypto exchange, transfer or trading (TBS).

How the position evolved:

Year	What happened
2026	ICT Division’s National Blockchain Policy backs blockchain for land records, identity and procurement, but leaves crypto trading and exchange licensing with Bangladesh Bank (policy PDF)
2022	FE Circular 24 bans dealing in virtual assets; export proceeds may not be parked abroad in crypto (bdnews24)
2021	In a letter to CID, a Bangladesh Bank official says owning or trading crypto “does not appear to be a crime”, though it may be prosecuted under FERA, anti-terrorism or AML law (FE)
2017	Fresh public notice: no virtual currency is approved by Bangladesh Bank (Dhaka Tribune)
2014	First Bitcoin warning, citing FERA and the AML Act (FE)

That 2021 letter matters a lot. It concedes that holding crypto is not itself an offence. The risk lies in how the taka got in and out, and what the coins were used for.

So the honest legal summary is this: crypto is not legal tender, not a licensed activity, and not something any Bangladeshi financial institution may touch. Holding it is a grey zone. Converting taka to crypto, moving value across the border with it, or using it to launder money is where prosecution happens.

What people actually do

The ban has not stopped crypto use. It has pushed it into informal, peer-to-peer channels that the state cannot see.

Chainalysis ranked Bangladesh 13th of 151 countries in its 2025 Global Crypto Adoption Index, third in South Asia after India and Pakistan (Financial Express). That is up from 35th a year earlier (Datawallet). Binance said in 2024 it had more than 600,000 Bangladeshi users (Crypto for Innovation). No official count exists.

How the money moves. Because no local exchange or bank card can buy crypto, users go through P2P marketplaces on international platforms, mainly Binance. A buyer picks a local seller, sends taka by bank transfer, bKash or Nagad, and the seller releases USDT or Bitcoin into the buyer’s account. Selling works in reverse. Financial Express columnist Atiqul Kabir Tuhin describes this system as a digital form of hundi.

Who uses it, and why:

• Freelancers. Many overseas clients pay in stablecoins such as USDT because transfers are fast and cheap compared with formal channels.
• Remittance senders. Part of expatriate money is believed to arrive through crypto rails rather than banks.
• Savers hedging the taka. Depreciation and inflation have pushed some people into dollar-pegged tokens.
• Young traders. Students and first-jobbers trade Bitcoin and altcoins on phone apps downloaded from mainstream app stores. A Dhaka Tribune report in early 2026 found young users openly arguing that regulation could bring the state hundreds of crores of taka in tax (Dhaka Tribune).
• Betting and gaming. Crypto has become a common payment rail for offshore betting sites.

Most of these users do not see themselves as lawbreakers. A 2025 academic study of Bangladeshi crypto users, titled What is “legal” and “illegal?”, examined exactly this confusion between the central bank’s warnings and everyday social norms (IACR ePrint 2025/005).

Where the gap hurts

When a market runs with no rules, the people who pay are ordinary users. Bangladesh’s record shows three recurring harms.

1. Ponzi schemes dressed as crypto. MTFE (Metaverse Foreign Exchange) launched in Bangladesh in June 2022 and spread through Facebook and YouTube ads promising easy profits. Account balances were fake; real deposits were routed to wallets abroad. It collapsed in mid-2023. CID’s Cyber Police Centre says about $136 million in crypto moved through it (New Age). On 30 March 2026, CID recovered $3.6 million (about Tk 44 crore) in USDT from OKX, the first time Bangladesh has ever brought back laundered crypto from abroad (Financial Express). Victims are still waiting for the courts to return it, and the alleged mastermind remains abroad.

There is a hard lesson here. Victims had no regulator to complain to before the collapse, because there is no regulated crypto sector. Recovery came only through blockchain forensics and the cooperation of a foreign exchange.

2. Betting money laundered through crypto. On 4 September 2026, CID said it had arrested four people in Khulna for running a betting network. Money was collected through rotating MFS numbers and bank accounts, converted into crypto on platforms such as Binance, and sent abroad. The case was filed under the new Gambling Prevention Act, 2026 (TBS).

3. No safety net when platforms fail. On 30 October 2026, hackers took $6.3 billion from Binance, which analysts attributed to North Korea. Binance halted withdrawals and said it would cover all losses (Reuters via TBS). Binance is also the main P2P gateway for Bangladeshis. Users in regulated markets have consumer-protection and complaint routes; Bangladeshi users officially do not exist, so they have nowhere local to turn.

Police action, meanwhile, mostly targets crimes linked to crypto. Arrests come when crypto is tied to fraud, betting, hundi or money laundering. Ordinary holders are rarely pursued, which reinforces the public belief that the ban is not real.

The debate: keep the ban, or regulate?

The official answer, for now, is to hold the line. In January 2026, Bangladesh Bank spokesperson Arif Hossain Khan told Dhaka Tribune the regulator was “not thinking positively about cryptocurrency at this moment”, while leaving the door open to change (Dhaka Tribune). He added that the central bank digital currency project had not moved forward much. Md Mostaqur Rahman became governor in February 2026 under the new government; no change to crypto policy has been announced (Datawallet).

The case for keeping the ban, as Bangladesh Bank and its supporters make it:

• Crypto is a ready-made channel for capital flight at a time when dollar reserves are precious.
• It is tied to money laundering, terror financing, betting and scams such as MTFE.
• Prices are volatile, and legal recognition could lure inexperienced savers into losses, as the stock market did.
• Global exchanges are themselves risky, as the Binance hack shows.

The case for regulating, as critics such as FE columnist Atiqul Kabir Tuhin argue (FE):

• The ban is not working; usage is among the highest in the world and growing.
• Prohibition hides the flows, so the state loses visibility, tax revenue and the ability to protect consumers.
• The FATF already expects countries to supervise virtual asset service providers, including P2P platforms, through KYC and reporting.
• Neighbours are moving. India now taxes crypto gains at 30 per cent; Pakistan set up a Virtual Assets Regulatory Authority in 2025 (Wikipedia).

A middle path is also on the table. One FE analysis argues Bangladesh should keep uncontrolled crypto settlement off-limits but promote regulated blockchain for trade finance (FE). The ICT Division’s 2026 blockchain policy already points that way: blockchain yes, crypto trading left to Bangladesh Bank.

The real question for Dhaka is not whether crypto should exist here. It already does. The question is whether the state wants to see it.

What this means for you

Many readers will ask a simple question: if I use crypto, am I a criminal? There is no clean yes or no. Here is what the facts say in plain words.

Holding crypto is a grey area. Bangladesh Bank itself told CID in 2021 that owning crypto does not appear to be a crime by itself. But the bank has never approved any cryptocurrency, and it has repeated its warnings many times since then.

Buying or selling with taka is the risky part. The 2022 circular says any deal made in, from or to Bangladesh to get crypto is not allowed. When you send taka through bKash, Nagad or a bank to a P2P seller, that payment leaves a record in the formal system.

Your bank or MFS account can be affected. Banks are told to watch for crypto-linked activity. If a P2P seller you paid is later caught in a fraud or betting case, your account can be frozen or you may be called for questioning, even if you did nothing wrong.

You have no local protection. If a platform is hacked, shuts down or freezes your money, no Bangladeshi regulator will take your complaint. The MTFE victims learned this the hard way.

Scams use the word “crypto” to look modern. Be careful with any app or Facebook page that promises fixed daily or monthly profit, asks you to bring in new members, or claims to be “approved by Bangladesh Bank”. No crypto product has that approval.

Freelancers have legal options. Payments from foreign clients can come through banks and approved digital payment channels. These are slower and sometimes cost more, but they keep you inside the law and count toward your official income.

This report is for public information only. It is not legal or financial advice. If you have a specific legal problem, speak with a lawyer.

Frequently asked questions

Is Bitcoin legal in Bangladesh?

No. Bitcoin is not legal tender and Bangladesh Bank has not approved it. Owning it is not clearly a crime, but buying it with taka goes against the central bank’s 2022 circular.

Is Binance banned in Bangladesh?

The app is not blocked and can be downloaded from app stores. But Binance has no licence here, and local banks and MFS providers are not allowed to support crypto trades.

Can I go to jail for trading crypto?

People have been arrested when crypto was linked to fraud, betting, hundi or money laundering. Cases usually run under the Money Laundering Prevention Act, the foreign exchange law or, since 2026, the Gambling Prevention Act.

Do I have to pay tax on crypto profit?

There is no special crypto tax rule, because the activity is not recognised. That is one reason critics say the ban costs the state money.

Will crypto become legal soon?

Not based on any public signal so far. Bangladesh Bank said in January 2026 that it is not positive about crypto “at this moment”, and no new policy has been announced since.

Key words explained

Word	Simple meaning
Cryptocurrency	Digital money that runs on the internet without a central bank, such as Bitcoin
Stablecoin / USDT	A crypto token designed to stay equal to one US dollar
P2P trading	Buying or selling crypto directly from another person, usually paying through bKash, Nagad or a bank
Hundi	Informal money transfer outside the banking system
FERA 1947	Foreign Exchange Regulation Act, the old law that controls dollar and foreign currency deals
BFIU	Bangladesh Financial Intelligence Unit, which tracks suspicious money flows
CBDC	Central bank digital currency, an official digital taka issued by Bangladesh Bank

How we reported this

This report is based on Bangladesh Bank circulars and public statements, court and police records reported by national newspapers, the ICT Division’s National Blockchain Policy 2026, and international data from Chainalysis and Reuters. We checked each figure against at least one published source and linked it below. Where numbers are estimates, such as user counts, we say so. Facts are correct as of 31 October 2026. Laws and policies in this area change, so readers should check the latest Bangladesh Bank notices.