Is Pi Network Legal in Nepal? (2024 Update)

Pi Network is gaining popularity worldwide as an emerging digital currency. Many Nepalese have also joined this platform, hoping to earn cryptocurrency through mobile mining. However, due to Nepal’s strict regulations on cryptocurrency, there is confusion regarding whether Pi Network is legal or illegal in Nepal. This article provides a comprehensive analysis of Pi Network, Nepal’s stance on cryptocurrency, and the risks involved in engaging with such platforms.

What is Pi Network?

Pi Network is a cryptocurrency project developed by Stanford University graduates that allows users to mine Pi coins using their smartphones. Unlike Bitcoin, which requires powerful computing resources, Pi Network operates on a consensus algorithm that enables mobile-based mining. The project aims to create a decentralized and accessible digital currency for everyone.

Nepal’s Official Opinion on Cryptocurrency

Nepal Rastra Bank (NRB), the central bank of Nepal, has explicitly declared cryptocurrency transactions as illegal. The bank issued a notice prohibiting any form of trading, mining, or promotion of digital currencies. Key points regarding cryptocurrency in Nepal include:

Legal Prohibition

NRB has banned the buying, selling, and trading of cryptocurrencies, including Bitcoin, Ethereum, and other digital assets.

Risk of Punishment

Engaging in cryptocurrency activities can result in legal consequences, including fines and imprisonment.

Past Crackdowns

Nepalese authorities have previously arrested individuals involved in crypto trading and mining operations.

Is Pi Network Considered Cryptocurrency?

While Pi Network claims to be a future cryptocurrency, it is currently not listed on any major exchanges. Users can mine Pi coins, but they cannot officially trade them for real money. Since Pi Network is still in its development phase, it does not function like traditional cryptocurrencies such as Bitcoin or Ethereum.

However, since the ultimate goal of Pi Network is to become a fully functional cryptocurrency, it may fall under Nepal’s crypto regulations once it enters the trading phase.

Is Pi Network Illegal in Nepal?

Since Pi Network is not yet an official cryptocurrency and cannot be traded, it does not directly violate NRB’s crypto ban. However, promoting, mining, or encouraging people to join Pi Network may still be considered a grey area under Nepalese law.

Here are some key considerations:

• If Pi Network remains a mobile-based point system without real monetary value, it may not fall under the legal definition of cryptocurrency.
• If Pi Network starts trading on crypto exchanges, Nepalese users may face legal consequences for participating.
• Nepalese authorities could take action against individuals or influencers actively promoting Pi Network.
• Pi Network has already started KYC verification for users, and its official posts indicate that it will be listed on exchanges in the coming days.
• Pi Network has started asking users to verify their KYC, which indicates it is preparing for official trading. However, this also means it could become illegal under Nepalese crypto laws.

Risks of Engaging with Pi Network in Nepal

Even though Pi Network is currently free to join, there are potential risks:

Legal Uncertainty

As Nepal’s crypto laws are strict, users may face legal issues if Pi Network becomes a recognized cryptocurrency.

Data Privacy Concerns

Users provide personal information while joining Pi Network, which could be misused.

Ponzi Scheme Risk

Since Pi Network has not yet launched officially, there is skepticism about whether it will ever have real value.

Lack of KYC Verification for All Users

While some users are being asked to verify KYC, the system is not universally implemented, raising concerns about compliance and security.

Potential Listing on Stock Exchange

In my opinion, if Pi Network is listed on stock exchanges, it may be classified as an illegal asset under Nepalese law.

Conclusion

At present, Pi Network operates in a legal grey area in Nepal. Since cryptocurrency is banned, Nepalese users should exercise caution while engaging with such platforms. Until Pi Network becomes officially tradable, its legal status remains uncertain.

For now, those involved in Pi Network should stay updated on Nepal’s crypto regulations to avoid any legal trouble. If you are considering joining Pi Network, make sure you understand the risks and legal implications involved.

Stay tuned for more updates on cryptocurrency laws in Nepal only on TheBipinBlog.