IMF Report Says Nepal's Crypto Ban Not Stopping Flows

Nepal's crypto flows hit 5% of gross domestic product in early 2025, the International Monetary Fund reported on June 10, 2026. At one point in 2021, right after the country imposed a total ban on crypto trading and mining, those flows briefly topped 13% of GDP.

The numbers come from an IMF report urging the Kathmandu government to build a regulatory framework aligned with FATF standards. Nepal's central bank declared crypto activities illegal in 2021. Trade, mining, even related services are all banned. The flows persist anyway, mostly through peer-to-peer transfers and stablecoins.

"From a business standpoint, it makes sense to establish regulation" to protect consumers and investors, said Musheer Ahmed, founder of Finstep Asia.

Stablecoins now dominate the flows, a pattern also seen in other countries with tight capital controls. Bitcoin (BTC) moves too much for daily remittances, so stablecoins fill the gap. The IMF report fits a broader push into crypto market analysis for nations trying to manage digital asset adoption, whether they ban or permit it.

El Salvador offers a parallel. In late 2024, to secure $1.4 billion in IMF financing, President Bukele officially stopped daily bitcoin purchases. On-chain data shows Salvadoran government wallets still add roughly 1 BTC per day.

Nepal's political environment complicates enforcement. Last September, Gen Z protests toppled the Oli government after authorities banned 26 social media platforms. Tens of thousands of Nepalis downloaded Bitchat, Jack Dorsey's decentralized app that works via Bluetooth without internet. China later demanded its removal from Apple's App Store.

The IMF report recommends Nepal align with FATF standards. The central bank has not publicly responded.