Saudi Arabia Regulators Ban Bitcoin Trading Due to High Risks and No Licenses in Place

Saudi Arabia Legalizes Official Policy to Ban Cryptocurrency Trading

State officials and finance watchdogs in Saudi Arabia have made it officially illegal for citizens to partake in any form of cryptocurrency trading or exchange in the country.

In an official statement by the administrative committee of government institutions within the Kingdom, the regulators confirmed their stand on the trading of cryptocurrency, with the writing warning of the potential consequences and financial risks the innovation may pose to the parties.

“The standing committee warns against trading in the digital currencies or what is known as virtual currency for their negative consequences and high risks for traders as they are out of government supervision.”

The Kingdom financial watchdog further reinforced its stance on the need to warn Saudi Arabians on the risks of investing in the digital currencies as the can are notorious for illegal activities and unforeseeable losses.

“The committee warns all citizens and residents about drifting after such illusion and get-rich scheme due to the high regulatory, security and market risks involved, not to mention the signing of fictitious contracts and the transfer of funds to unknown recipients/entities/parties.”

The ruling by the standing committee follows a recent surge in cryptocurrency activities within Saudi Arabia. The emergence has seen increased virtual currency promotions, marketing and trading in the Arab nation.

With the release of the official statement, the standing committee could finally debunk and ascertain Saudi Arabia's position towards the recent claims by crypto websites and ventures of having received certification from the necessary legal bodies.

Way forward

Despite the decree, there is still no apparent punishment that is determined on citizens caught crypto trading within Saudi Arabia. The committee has only taken the liberty to warn citizens of drifting after the illusion of crypto trading as a get-rich scheme. Potentially, the legal body feels that the official ban offer a better solution than actual undertaking regulation of the virtual currencies.

The “Standing Committee”

The Standing Committee is a legal committee headed by the Capital Market Authority (CMA), Ministry of Media, Ministry of Interior Membership, Saudi Arabian Monetary Authority (SAMA), Ministry of Commerce and Investment. The body is a result of a supreme decree and works with the relevant parties to reduce cryptocurrency marketing and trading by reporting to the proper authorities. The committee also works to regulate Forex by creating awareness against the act of unauthorized forex activities. Most notably, the regulator considers such actions as fraudulent in Saudi.