Two kinds of risk
Crypto’s risks can be thought of in two groups. The first is the same in every country: violent price swings, losing your secret key, the platform holding your coins collapsing, and fraud. These come from the nature of the technology and the market.
The second group is specific to Bangladesh: Bangladesh Bank has not permitted dealing in crypto here. So if something goes wrong, there is no legal protection or regulated complaints route, and the dealing itself can raise issues under foreign-exchange law.
Say Rafi sends money by mobile banking to someone he met on social media to buy some crypto. Several risks stack up at once: the price may fall, the seller may never deliver the tokens, someone may steal the wallet key, and because the deal did not go through an approved route, there is nowhere to complain if things go wrong. The story is imaginary.
Why it matters to an investor
- To see the whole picture: thinking only “will the price go up or down?” leaves half the risk out of sight.
- To know the legal position: dealing without knowing Bangladesh Bank’s instructions carries a risk of legal trouble.
- To spot fraud: crypto-themed fraud is huge worldwide, and once you are a victim, getting money back is almost impossible.
- To understand the maths of losses: after an 80% fall, the price must rise 400% just to get back to where it was.
Risks found in every country
- Price risk: no income or assets stand behind crypto; the price runs on demand and mood. Even large tokens have fallen 70–80% in months, and many small ones have gone to almost zero.
- Key and custody risk: if you lose the wallet’s secret key (private key or seed phrase) or someone learns it, there is usually no way back, and a transfer to the wrong address cannot be reversed.
- Platform risk: coins kept on an exchange or app are really in that platform’s hands. If it goes bust or is hacked, customers’ money can be frozen; this happened even at large exchanges abroad in 2022.
- Stablecoin risk: “stablecoins” meant to stay equal to a dollar can lose that link. In May 2022 a large stablecoin without adequate asset backing lost its dollar peg, and its sister token fell to almost zero. The IMF’s head then described stablecoins not backed by assets as a “pyramid”.
- Fraud risk: according to one blockchain analytics firm, people lost close to $10 billion to crypto scams in 2024 alone, and the full figure could exceed $12 billion.
The legal position in Bangladesh: a timeline
Crypto is not legal tender in Bangladesh, and there is no licensed exchange or regulatory framework for it. Bangladesh Bank’s position has developed step by step:
- 2014 and 2017: warnings not to deal in virtual currencies, saying this could breach the Foreign Exchange Regulation Act 1947, the Anti-Terrorism Act 2009 and the Money Laundering Prevention Act 2012.
- 2021: in a letter to the police Criminal Investigation Department (CID), Bangladesh Bank said that although owning or dealing in crypto is not recognised, it does not in itself appear to be a crime; it is different if money laundering or terror financing is involved.
- September 2022: a circular told everyone to refrain from dealing in virtual assets and currencies, and barred banks, financial institutions and mobile financial services from facilitating it. Dealing in breach of it was said to be punishable under section 23(1) of the Foreign Exchange Regulation Act, which allows up to 7 years’ imprisonment.
- October 2022: banks were told to step up monitoring of crypto transactions and to display a notice of the restriction at branches and on their websites.
- June 2026: the Finance Bill 2026 proposed a 15% capital gains tax on profits from selling gold, silver, jewellery and “digital currencies” declared in the tax return. The report did not make clear which digital currencies were meant, or whether this changes Bangladesh Bank’s position.
What the legal risk means in practice
Because it is not permitted, crypto comes with no investor protection, no deposit protection and no regulated complaints route. Sending money to foreign platforms by card or other routes raises foreign-exchange law issues, and banks and mobile financial services monitor such transactions.
When this page was updated (October 2026), we found no announcement withdrawing the 2022 circular. But rules can change; check Bangladesh Bank’s website for the current position. For Bangladeshis living abroad, the law where they live may differ.
Worked example
- Say you buy Tk 1,00,000 worth of a token.
- The price falls 80%, so it is now worth Tk 20,000.
- To get back to Tk 1,00,000, Tk 20,000 must grow fivefold, meaning the price must rise 400%.
Result: the deeper the fall, the harder the way back: after a 50% fall you need +100%, after 80% you need +400%, after 90% you need +900%. The numbers are only an example.
Common mistakes
- Thinking risk means only price, and ignoring key, platform and legal risks.
- Assuming that because a tax proposal mentions “digital currencies”, dealing has become legal. Read Bangladesh Bank’s latest instructions yourself.
- Assuming a “stablecoin” can never fall because of its name.
- Giving anyone your seed phrase or password in the name of “support”.
Crypto’s risk is not just a falling price: count keys, platforms, fraud and, in Bangladesh, the lack of legal permission, all together.