In a bid to combat cybercrime and illegal financial activities, the Belarusian Ministry of Foreign Affairs has announced new legislation that will prohibit peer-to-peer (P2P) transactions involving cryptocurrencies like Bitcoin and Pi Network’s Native Coin IOU. The ministry issued an official announcement on Telegram on July 2, stating that individuals will be restricted from engaging in P2P crypto exchanges.
Citing a significant rise in cybercrime within the country, the ministry highlighted that local prosecutors have cracked down on 27 citizens involved in providing “illegal crypto exchange services” since the beginning of 2023. These individuals collectively earned approximately 22 million Belarusian rubles ($8.7 million) through illicit means.
According to the ministry, P2P crypto services are particularly favored by fraudsters who exploit them to cash out and convert stolen funds, as well as transfer money to organizers and participants involved in criminal schemes. To curb such illicit activities, the ministry aims to limit individuals’ ability to engage in P2P transactions and instead mandate the use of registered cryptocurrency exchanges within the Belarus Hi-Tech Park (HTP).
In an official statement, the ministry explained, “The MFA is working on legislative innovations that prohibit crypto exchange transactions between individuals. For transparency and control, citizens will be allowed to conduct such financial transactions only through the HTP exchanges.” Additionally, the ministry expressed intentions to adopt a procedure similar to foreign currency exchanges, making it “impossible to withdraw money obtained from illegal activity.”
The impact of this move by the Belarusian government will extend to users of the Pi Network, a cryptocurrency platform that had gained popularity in the country. Pi Network’s Native Coin IOU, like other cryptocurrencies, will be subject to the prohibition on P2P transactions for individuals. This means that Pi Network users in Belarus will no longer be able to directly exchange the native coin with other individuals.
Instead, users will be required to utilize registered exchanges within the Belarus Hi-Tech Park to trade their Pi Network tokens. This shift aims to enhance transparency and oversight while discouraging fraudulent activities associated with crypto transactions. However, it also introduces additional complexity and potential limitations for Pi Network users in Belarus who have been accustomed to conducting P2P exchanges.
The Ministry of Foreign Affairs believes that by implementing these measures, it will become unprofitable for information technology fraudsters to operate in Belarus. While the intentions are to enhance security and protect citizens from cybercrime, the impact on Pi Network users may pose challenges as they navigate the new regulations and adapt to the designated exchange platforms.
