Bangladesh’s Crypto Conundrum: A Nation Votes, While Millions Trade in Shadows

In the land where the sun rises over the Padma River, a paradox unfolds: a nation at the ballot box, yet millions transact in a realm the government deems illicit. Ah, the sweet irony of progress!

As Bangladesh Votes, a Crypto Underground Demands Recognition

The following tale, penned by Nabil Sorkar, a Verse Community Member, unfolds in the sweltering heat of Dhaka, where the air is thick with anticipation and the whispers of digital rebellion.

DHAKA, Bangladesh – On a Wednesday morning, as the sun blazed over Mirpur, a district where the sweat of labor mingles with the dust of dreams, Rafiq Ahmed, a young soul of 22 springs, cast his vote. A freelance artist, he joins the chorus of 127 million voices shaping a new parliament, the most pivotal in a generation. Yet, in the eyes of the law, he is a rogue, a rebel with a digital wallet.

Ahmed, a pseudonym to shield him from the long arm of the law, holds $1,400 in the digital vaults of Binance, the titan of cryptocurrency exchanges. He earns in USDT, a stablecoin tethered to the dollar, from patrons in Dubai and Singapore. Through a peer-to-peer network, he transforms it into Bangladeshi taka, a process as swift as a gazelle, yet, according to the Bangladesh Bank, as illegal as smuggling tea across the border. The penalty? Up to seven years in a cell, where the only trading is of cigarettes and favors.

“Everyone I know does this,” he confessed, his voice mingling with the hum of the crowd outside a polling station. “The government declares it forbidden, yet offers no lawful path. It’s like banning the monsoon but forgetting to provide umbrellas.”

And he is but one in a multitude.

A Ban That Didn’t Work

Despite one of Asia’s most draconian cryptocurrency prohibitions, Bangladesh has blossomed into one of the world’s most vibrant crypto markets. A spectacle that bewilders regulators, emboldens tech visionaries, and presents a quandary for the incoming government. Chainalysis, the oracle of blockchain analytics, reveals Bangladesh leaping from 35th to 13th in global cryptocurrency adoption in a single year. An estimated 3.1 million Bangladeshis now hold crypto wallets, a number that grows with the tenacity of bangla weeds after the first rain.

The nation received a record $30 billion in remittances in the fiscal year ending June 2025, a 25.5 percent surge. Yet, sending money through traditional channels is as costly as a wedding feast. The World Bank laments the cost at $9.40 for every $100 transferred, the highest in South Asia. Through stablecoins, the same transfer costs a mere $1.50, arriving faster than a rickshaw in Dhaka traffic.

“When you grasp the remittance arithmetic, you understand why the ban is as effective as a sieve in a rainstorm,” remarked a fintech sage in Dhaka, who prefers anonymity to avoid the wrath of officials. “You’re asking people to pay sixfold more. Of course, they’ve found another way.”

An Election 18 Years in the Making

Today’s vote is Bangladesh’s first genuinely competitive election since 2008, a period marked by boycotts and rigged ballots. The path to this moment was as tumultuous as a cyclone: in August 2024, a student-led uprising, fueled by outrage over government job quotas, toppled Prime Minister Sheikh Hasina, who fled to India. Muhammad Yunus, a Nobel laureate, was installed to lead an interim government. The Awami League, Hasina’s party, which ruled for 15 years, is barred from participating.

The race narrows to two blocs: the Bangladesh Nationalist Party, led by Tarique Rahman, son of former Prime Minister Khaleda Zia, and an 11-party alliance anchored by Jamaat-e-Islami, Bangladesh’s largest Islamist party, in an unlikely coalition with the National Citizen Party, born from the student uprising and led by Nahid Islam, a mere 26 years old.

Neither bloc has uttered a word about cryptocurrency in their manifestos. Yet, the election’s outcome may shape the future of digital assets more than any central bank decree in the past decade.

The Generation That Overthrew a Government

The electorate’s most striking feature is its youth. According to the Bangladesh Election Commission, 55.65 million registered voters, 44 percent of the total, are under 37. A survey by the Bangladesh Youth Leadership Centre finds 97 percent of voters aged 18 to 35 intent on casting a ballot, a fervor attributed to the politicizing effect of the 2024 uprising.

This is the generation that toppled a government with smartphones and Telegram channels. It is also the generation that embraced cryptocurrency. The overlap is no coincidence. Bangladesh’s crypto users are predominantly young and urban, earning in dollars through platforms like Fiverr and Upwork, with no convenient way to convert to local currency. For them, Binance’s peer-to-peer market, accessed via VPN, is not a rebellion but a necessity.

“These young souls are not crypto enthusiasts but workers needing to be paid,” said Syed Almas Kabir, former president of BASIS, the nation’s tech trade titan. “Cryptocurrency is the future. Denial is as futile as trying to stop the Jamuna River with a fishing net.”

The Regulation That Isn’t

The legal framework of Bangladesh’s crypto ban is, by the government’s own admission, a tangled web. No specific law prohibits ownership or trading. Instead, Bangladesh Bank relies on circulars, the most notable being Foreign Exchange Policy Department Circular No. 24, issued in September 2022, blocking transactions related to “virtual assets.” Violations are punishable under the Foreign Exchange Regulation Act of 1947, a relic from the British partition.

The contradictions surfaced in 2021, in a farce worthy of Dhaka’s fintech circles. The Criminal Investigation Department asked the central bank if cryptocurrency was legal. An assistant director replied it “does not appear to be a crime.” The bank’s spokesperson contradicted him, insisting the position “didn’t change at all.” The C.I.D. declared crypto illegal. The legal grey area persists, with enforcement targeting large operators rather than individual users.

Across the Border, a Different Story

What makes Bangladesh’s stance untenable is not just internal dynamics but regional shifts. Pakistan, once Bangladesh’s economic twin, underwent a rapid crypto-regulatory transformation in 2025, establishing the Pakistan Virtual Assets Regulatory Authority and licensing major exchanges. India, despite a 30 percent crypto tax, kept the market legal, generating revenue and leaving room for regulatory refinement. Bangladesh, in contrast, chose total prohibition, aligning primarily with China.

“There’s a growing awareness in Dhaka that the neighborhood has moved on,” noted a policy researcher. “When Binance is licensed in Islamabad and banned in Dhaka, it’s a position as defensible as a sandcastle against the tide.”

The $260 Million Question

The economic argument for reconsidering the ban hinges on $30 billion in remittances. The actual figure, including informal channels, is higher. The government campaigns to formalize remittances, but traditional channels are costly. A Bangladeshi worker in Riyadh sending $200 monthly loses $19 to fees and exchange rates. Over a year, that’s $228, nearly a month’s savings. Stablecoin transfers cost about $3, with instant settlement. If one-third of remittances migrated to stablecoin rails, savings would exceed $260 million annually, a sum that could feed countless families.

This figure – $260 million returned to the poorest – is the moral and economic core of the legalization argument.

What Comes Next

No one expects the next government to legalize cryptocurrency immediately. Priorities are urgent: an IMF program, a scarred banking sector, graduating from least-developed-country status, and restoring institutional credibility. However, forces are converging for potential movement within two to three years.

The BNP, the likely winner, pledges to bring PayPal and create 10 million jobs in the digital economy. The IMF’s program pushes toward financial liberalization, making a crypto ban harder to justify. The revenue argument is compelling: a 15 percent tax on crypto activity could generate $150 million to $250 million annually for a cash-strapped government.

The most likely first step? Regulated stablecoin corridors for remittances, a crack in the wall that tends to widen.

The Sharia Question

Bangladesh, 90 percent Muslim, faces a unique variable: Islamic law. Jamaat-e-Islami, a significant election force, has not formally addressed cryptocurrency. However, stablecoins, pegged to real assets and low in volatility, may align with Islamic finance principles, especially for remittances, a matter of public welfare.

In the Shadows, a Market Waits

In Mirpur, as the polling lines stretched, Rafiq Ahmed’s life remained unchanged. He would continue his digital transactions, technically illegal. But something had shifted. The old government was gone. The students had won. The world watched. For the first time, he felt the system might catch up with reality.

“I voted for the future,” he said. “I hope the future votes for us.”

Reporting for this story was contributed from Verse Community Members in Dhaka. Join the community t.me/GetVerse.

FAQ 🇧🇩

Is cryptocurrency legal in Bangladesh? No – Bangladesh Bank prohibits crypto transactions, with penalties up to prison time.
Why do millions still use crypto? Many use stablecoins for cheaper, faster remittances and payments.
How large is crypto adoption? Bangladesh ranks 13th globally, with 3.1 million users.
Could the new government legalize crypto? While no party pledges reform, remittance savings and regional shifts may force a rethink.

2026-02-12 13:37