Saudi Arabia issues virtual currency ban warning

A standing committee including the central bank of Saudi Arabia has said that trading of ‘unauthorised’ cryptocurrencies is illegal in the country.

A statement published by the Saudi Arabian Monetary Authority (SAMA) warns against “trading in the digital currencies or what is known as virtual currency for their negative consequences and high risks on traders as they are out of government supervision.”

It adds: “Virtual currency including, for example but not limited to, Bitcoins are illegal in the kingdom and no parties or individuals are licenced for such practices. The committee warns all citizens and residents about drifting after such illusions and get rich schemes due to the high regulatory, security and market risks involved, not to mention signing of fictitious contracts and the transfer of funds to unknown recipients/entities/parties.”

The committee will work with relevant parties to reduce marketing for investment and trading in forex and virtual currencies. Saudi Prince Al-Waleed bin Talal slammed Bitcoin during an appearance on CNBC last year, labelling it a “fraud” and comparing it to Enron.

“This thing is not regulated. It’s not under control. It’s not under the supervision of any federal – elect – United States Federal Reserve or any other central bank,” he added.

BitOasis

The crackdown follows the launch of BitOasis, the first crypto exchange in the Middle Eastern and North Africa region. Citizens in Saudi Arabia, the UAE, Kuwait, Bahrain and Qatar can use the service by sending money to a BitOasis bank account and exchanging it for Bitcoins for a 1% fee.

The company continues to list Saudi Arabia among its supported countries. It did not respond to Coin Rivet’s request for comment.