The Qatar Financial Centre (QFC) Regulatory Authority has imposed a ban on all crypto asset services in the Gulf region. According to a statement, Qatar’s ban on virtual asset services will not permit the use of cryptocurrencies at this point in time.
The QFC said in a statement that the ban will cover “anything of value that acts as a substitute for currency, that can be digitally traded or transferred and can be used for payment or investment purposes.” The ban prohibits exchange between virtual assets and fiat currencies, exchange between one or more types of virtual assets, transfer of virtual assets, administration of trading services and issuance of virtual assets.
The exact reason for the QFC’s cryptocurrency ban is not mentioned in the statement. However, digital forms of securities or other types of financial instruments which are regulated by the Regulatory Authority, the Qatar Central Bank or the Qatar Financial Markets Authority are legally permitted in the country, the local media reported.
Owing to anti-money laundering laws and actions, cryptocurrency firms are shutting down in many countries. In 2018, the Qatar Central Bank sent a statement to all banks operating in the country that trading in bitcoin is is not allowed.
Furthermore, the statement noted that cryptocurrency is volatile and is prone to financial crimes as well as electronic hacking. It emphasised that these risks could result in loss of value as there are no guarantors or assets. In fact, Qatar had declined Venezuela’s proposal for the country to invest in El Petro cryptocurrency project in 2018.