Can Any Government ban the Bitcoin?

Bitcoin has been around the margins of financial markets for less than a decade, but is gradually gaining prominence as an alternative asset class. Can the government of every major country intervene and do the unthinkable - the ban on Bitcoin?

Flashback - Gold titanium is a crime

Those who think that no government (except those led by tinpot dictators) would take the extreme phase of the Bitcoin ban requires a lesson in history. There was a time when possession of gold bullion was a crime in America, punishable by a sentence of up to ten years in prison. In 1933, US President Franklin D. Roosevelt issued an order calling on all Americans to deliver their gold holdings to the Federal Reserve Bank. The prohibition on owning gold remained in force for more than four decades, before President Ford legalized gold ownership. This move has been made easy by the fact that America has abandoned the gold standard just before and therefore did not need to own large amounts of gold to support the amount of currency it printed.

The Great Chinese Firewall

Another frequently repeated argument against a Bitcoin ban is that individual governments in the era of globalization of the Internet economy do not have the power and power to act against a decentralized currency such as Bitcoin. However, we just have to look at how China even slid the Internet to realize that this is not the case. With a mix of government laws and the blockage of popular foreign web sites by Chinese Internet service providers, the Chinese government has tried to limit the Chinese to a walled garden rather than seeing the global network. Traffic monitoring tools are used by the government to break political dissent. Stepping in to ban Bitcoin would not be a big leap for the Chinese government.

India and demonization

If you think fiat tickets, printed by the government and certified by the Central Bank, would be the last to be banned, think back! The government of India issued a decree in November 2016, claiming that high denomination bills cease to be legal almost immediately. Indians had to flee to the banks to deposit old bills. Taking over the replacement currency was not easy, leading to large numbers in ATMs. This demonetization has been promoted as a means of curbing tax evasion and solving most of the government's problems. Almost a year later, it became clear that demonetization did not reach the government's goals and only led to an increase in demand for Bitcoins.

Matters of compliance

If the government decides to make Bitcoins trade or ownership illegitimate, questions will arise as to how it will impose such a ban. It is impossible for the government to take advantage of its Bitcoins unless it decides to hand over its personal keys. Most citizens and institutions, however, want to stay on the right side of the law. So the search for Bitcoin will collapse if the government decides to ban it. All exchanges in this country will also be closed and the purchase / sale of Bitcoin will be difficult and risky. This could stifle Bitcoin in this country and meet government goals.