Nepal's Crypto Policy: Time for a Regulatory Shift

Crypto-assets, including cryptocurrencies and stablecoins, have become an essential part of modern payment systems, offering borderless transactions and privacy. However, their decentralized nature makes them challenging to regulate.

Nepal's restrictive approach to digital assets is understandable given its capital controls and shallow financial market infrastructure. The country receives around $10 billion in annual remittances, making a comprehensive digital assets policy crucial.

Globally, regulatory frameworks for crypto-assets vary widely, ranging from total prohibition to full adoption. Some countries have shifted towards risk-based regulation, while others have implemented restrictive models or adopted lighter regulation.

Nepal can learn from these examples and adopt a progressive, prudential regulation that balances financial stability, consumer protection, and potential opportunities. The country needs a national cryptocurrency and digital assets policy with clearly defined regulatory architecture.