Not only Hungary: countries that narrow legal spaces for their crypto communities

Every day, the media are telling us how various countries take legal steps to embrace cryptocurrency. However, not the entire humanity is moving in the same direction in this regard. On July 14, 2025, Hungary introduced the law turning “unauthorized crypto trading” into a crime punishable with several years behind bars. Several other governments are busy narrowing the legal spaces for crypto, too.

News from Hungary

The Hungarian attack on crypto is described as “sudden,” and generally, it doesn’t fit in the overall European approach to crypto regulation. The government banned trading on unlicensed platforms. Violators face up to several years in prison depending on the amounts involved in illegal transactions. 

Providing unlicensed crypto trading services became another punishable violation. Several huge crypto platforms have had to stop their services in Hungary because of the law, leaving millions of users to seek alternatives. 

What’s worse, some are afraid that past transactions can be the reason for prosecution, so it may turn out that no crypto trader is safe in Hungary. It is hard to tell who will fall victim to the new law, as the Hungarian Financial Supervisory Authority is still working on the compliance guide.

Ambiguous signals from Russia

Until 2020, cryptocurrencies had no legal status in Russia. They were deemed as “money surrogates” and banned as such. In 2022, Russia began to work on moderate pro-crypto regulation. However, generally, crypto is still in a grey zone where many crypto-themed media outlets and crypto markets are blocked. In the conditions of sanctions pressure, President Vladimir Putin encouraged Russian companies to trade with foreign partners using cryptocurrency. 

Russia is one of the top Bitcoin miners among all countries. While the government doesn’t suppress mining, the sector finds itself under attack from Western countries as mining is believed to be closely intertwined with the state elite. The new national registry of mining equipment is aimed at intensifying control over the mining sector.

Some Russian oligarchs opted for Bitcoin mining early on. For example, aluminium magnate Oleg Deripaska re-equipped one of his factories in Siberia into a huge mining facility back in 2019. BitRiver is a sanctioned mining operation. Sanctions caused the shutdown of Russian crypto exchange Garantex.

In 2025, the Bank of Russia introduced legislation that would allow the exchange of crypto for “qualified traders” and limit it for the rest of the Russians. If the bill gets adopted in this form, it will seriously limit the legal scope of actions with crypto for most citizens. The testing launch of Digital Ruble, planned for 2025, was postponed.

China to rethink its tough stance on crypto

China was one of the leading countries in terms of Bitcoin mining and various crypto businesses, but after a series of restrictive legal steps, the country became one of the least crypto-friendly jurisdictions in the world. First, it forbade financial companies from having crypto holdings and trading crypto, eventually prohibiting them from facilitating or making any kind of crypto transactions. Crypto exchanges were banned in 2017, the next year China banned Bitcoin mining, and finally, the complete ban on crypto operations and mining was put into effect in 2021. Each of these restrictions forced companies to relocate to friendlier jurisdictions. 

Only in the summer of 2025, the unofficial information about a possible crypto thaw in China leaked in the media. Allegedly, the people in power decided that they should get more sensitive towards the newest financial technologies amidst the rising popularity of stablecoins. Still, China continues to work on the digital yuan.

Turkey’s war on crypto intensifies in 2025

Cryptocurrency began to gain popularity in the wake of a drastic drop in the Turkish lira’s value. The move didn’t go unnoticed by the government. The Central Bank of Turkey responded with a ban on crypto in 2021. 

However, the Turkish state’s opposition to crypto doesn’t stop here. The government is trying to prevent money outflows via crypto. In June 2025, it became known that Turkey’s Ministry of Treasury and Finance is working on new regulations aimed at increased control of crypto transactions. Users will have to provide text explanations of the purpose of each crypto transaction, and the crypto platforms will be forced to make a 48 to 72-hour delay when someone withdraws money. Stablecoins’ use will be limited to $50,000 per month or $3,000 per day. On top of this, Turkish financial regulators banned decentralized exchanges like PancakeSwap.

Strict ban and enforcement in Nepal 

Nepal fully banned crypto in 2018. Enforcement actions against P2P traders 2022-2025 resulted in over 50 arrests. The prohibition violators faced various punishments from fines to jail time. 

The government keeps its eye on banks and crypto services, aiming to prevent any crypto-related activity. Despite the harsh laws and enforcement, Nepal residents continue to use crypto at their own risk.

Change of power in Afghanistan resulted in a total crypto ban

Nevertheless, the 2020s saw a number of governments trying to get rid of crypto in their countries. As the Taliban took over Afghanistan in 2022, it banned crypto as a form of fraudulent money. 

According to Chainalysis, before 2022, Afghanistan was a relatively crypto-savvy country. The change resulted in the shutdown of 20 local companies working with cryptocurrency.

Conclusion

Many more countries banned crypto in 2018. The timing is clear: masses learned about Bitcoin in 2017, and in January of 2018, its price crashed. The altcoin market soon nosedived too. The ICO bubble burst, leaving many inexperienced investors with nothing. The ban on crypto in 2018 may be seen as the swift yet superficial international reaction to these events. However, some countries reconsidered their approach and chose to research crypto and apply risk management mechanisms instead of banning all crypto at once.

Still, in many countries, crypto is not being legalized to this date. It is worth saying, even in these places, people continue to use crypto despite moderate and harsh restrictions. It makes crypto skeptics’ arguments about the lack of use cases of crypto seem shallow.