In today’s digital era, technology is constantly reshaping lifestyles and work methods. A significant example of this evolution in the financial sector is cryptocurrency. Most people have heard of cryptocurrency or Bitcoin. This article explores what they truly are and why they are so widely discussed in the modern economic system.
What is cryptocurrency?
The word “crypto” refers to something hidden or secret; however, it does not mean “secret currency”. Rather, it is a digital or virtual currency built on a decentralised ledger technology called blockchain, whose transaction security is ensured through cryptography.
Blockchain is a form of digital database where all transaction information is stored sequentially in the form of “blocks”. Once a block is filled with transaction data, a new block is created and linked to the previous one like a chain. This technology uses powerful coding known as cryptography to secure transaction data, making it nearly impossible to hack or alter cryptocurrency transactions.
To simplify the concept, blockchain can be compared to a village market where every time a trade occurs, everyone in the village records it in a notebook. After each transaction, everyone verifies it using a unique and complex signature, and everyone keeps an identical copy of the notebook. In this comparison, the notebook represents the decentralised database or blockchain where everyone has the same copy and no single person can alter or control the records. The complex signatures represent cryptography, which secures and verifies transactions, while the goods being traded represent cryptocurrencies.
Any technically skilled individual or institution can create and issue a cryptocurrency. Since it is decentralised, no authority can control the transactions, unlike the traditional banking system where banks hold such authority. This enables users to send currency to anyone, anywhere and at any time without third-party intervention.
The concern is that this freedom can sometimes be misused by criminals to conceal illicit funds. Although technology allows such transactions to be traced, the process remains highly complex.
What is bitcoin?
There are currently thousands of cryptocurrencies worldwide. Among them, Bitcoin, Ethereum, Binance Coin, Ripple and Dogecoin are widely known. Bitcoin remains the most popular, the most valuable and the first-ever cryptocurrency.
Bitcoin was launched in January 2009 by an individual or group using the alias ‘Satoshi Nakamoto’. To this day, the true identity behind the name remains unknown. The first commercial transaction involving Bitcoin took place on 22 May 2010, a date now known as ‘Bitcoin Pizza Day’, when a programmer named Laszlo Hanyecz purchased two pizzas for 10,000 Bitcoins.
At present, a single Bitcoin is worth more than Tk1 crore. By contrast, some other cryptocurrencies have such low values that 1,00,000 units are worth less than Tk100.
The Bangladesh context
There is no specific law governing cryptocurrency in Bangladesh; however, its use is not legal. Bangladesh Bank has issued multiple cautionary notices and circulars over time discouraging the use of cryptocurrency.
On 24 December 2017, Bangladesh Bank issued a public notice banning Bitcoin and other cryptocurrencies, stating that they are not legal tender and that related transactions may violate money laundering and terrorism financing laws. The central bank reiterated its position through another public notice on 29 July 2021.
On 15 September 2022, Bangladesh Bank issued FE Circular No 24, explicitly prohibiting dealings with virtual assets and virtual currencies and clarifying that these are not approved under the Foreign Exchange Regulation Act, 1947. Subsequently, on 12 October 2022, the central bank instructed all scheduled banks to strengthen monitoring and stop providing any assistance related to crypto transactions, including exchange, transfer and trading.
Despite these restrictions, the reality suggests a different trend. According to the Global Crypto Adoption Index 2025 published by blockchain analytics firm Chainalysis, Bangladesh ranked 13th, a notable rise from 35th in 2024. Numerous cryptocurrency-related community groups linked to platforms such as Binance, the world’s largest crypto exchange, are active on Facebook and Telegram. A large number of Bengali-language videos on the topic are also available on YouTube, reflecting growing public interest in cryptocurrency in Bangladesh.
Blockchain technology and cryptocurrency have ushered in a new era in the financial sector. Although cryptocurrency remains prohibited in Bangladesh, its potential cannot be ignored. With proper policy formulation and effective regulatory frameworks, its legalisation could contribute to higher freelance income, job creation in the information technology sector, technological advancement and increased national revenue.
The wider application of blockchain technology could also create opportunities in education, healthcare and administrative services. By harnessing the interest and entrepreneurial spirit of the younger generation, Bangladesh could develop a strong digital economic structure and strengthen its position in this emerging technological frontier.
The writer is a Bangladeshi banker.
