Egypt Crypto Risk Assessment Tool
Egypt Crypto Risk Assessment Tool
Based on Law 194 of 2020, which prohibits all cryptocurrency activities without Central Bank approval. This tool helps you understand your personal risk level when using cryptocurrency in Egypt.
On September 16, 2020, Egypt didn’t just update its banking laws-it shut the door on cryptocurrency for millions of its citizens. Law No. 194 of 2020, officially called the Central Bank and Banking Sector Law, didn’t just regulate crypto. It banned it. Completely. And it’s still in force today.
What Law 194 of 2020 Actually Says
At first glance, it looks like just another banking reform. But buried in Article 204 is a line that changed everything: “Strictly prohibits the issuance, trading, and promotion of cryptocurrencies without prior approval from the Central Bank of Egypt.” That’s it. No gray area. No exceptions listed. No grandfathering. Just a flat ban.
That one sentence covers everything: buying Bitcoin, selling Ethereum, running a crypto exchange, mining coins, even posting a YouTube video explaining how to use Binance. All of it requires permission. And as of late 2023, no one has received that permission.
The law doesn’t just target big players. It targets anyone who touches crypto in any way. Banks are forbidden from processing payments to crypto platforms. Payment apps can’t link to wallets. Even advertising a crypto-related service online could land you in legal trouble.
Why Egypt Went All-In on the Ban
The Central Bank of Egypt (CBE) says it’s about protecting people. Their official warnings claim cryptocurrencies are “highly volatile,” “lack legal protection,” and could trigger “financial instability.” They point to risks like fraud and capital flight.
But the real reasons run deeper. Egypt’s currency, the pound, has been falling hard. Inflation hit 37% in 2023. The government is desperate to control money leaving the country. Crypto, especially peer-to-peer trading, offered a way for Egyptians to hold value outside the banking system. That’s a threat to monetary control.
Internal CBE reports from before the ban estimated $200 million in annual crypto transactions. That’s not a massive number globally-but in Egypt’s economy, it’s significant. And it was growing fast. The CBE didn’t want to lose control.
There’s also a political layer. Egypt’s leadership has long preferred centralized control over financial systems. Crypto’s decentralized nature clashes with that philosophy. Unlike the UAE, which built a regulated crypto hub in Dubai, Egypt chose to shut it down entirely.
Who Got Hurt the Most
The ban didn’t just stop trading-it froze lives.
Thousands of Egyptians had money locked in exchanges like Binance and Coinbase. When banks cut off access, those funds vanished. The “Egypt Crypto Victims” Facebook group, with over 12,500 members, documented 427 cases of frozen assets totaling nearly $9 million. Most users never got their money back.
Entrepreneurs didn’t stand a chance. A 2022 survey found that 78% of blockchain startups in Egypt had shut down or moved abroad-mostly to Dubai or Singapore. That’s an estimated $150 million in lost investment and talent. Egypt’s fintech sector, which had been growing at 30% a year, collapsed overnight.
Even regular users got caught. Reddit threads from 2021 to 2022 show 87% of Egyptian crypto users reported their exchange accounts blocked. Many had no idea why. They just woke up one day and couldn’t log in.
The Enforcement Machine
The ban isn’t just a law-it’s an enforcement system.
Banking institutions were given deadlines to install software that flags crypto-related transactions. Large banks had six months. Smaller ones had up to 18 months. By 2022, 92% of peer-to-peer crypto trading volume had vanished, according to Chainalysis. That’s not because people stopped using crypto. It’s because the infrastructure to support it was ripped out.
Law 194 also ties into Egypt’s 2018 Anti-Money Laundering Law. That created a dangerous overlap. Some people were prosecuted twice-for the same crypto transaction-once under the banking law and again under money laundering rules. The Egyptian Initiative for Personal Rights documented 47 such dual prosecutions by mid-2023.
The CBE has no public record of fines or jail sentences, but Article 205 gives them the power to refer cases to criminal courts. No one knows how many people have been quietly charged. The silence is part of the fear.
What’s Still Going On (Despite the Ban)
Here’s the irony: the ban didn’t kill crypto. It just drove it underground.
Chainalysis estimates that 3.2 million Egyptians-about 3% of the population-are still using crypto. They’re doing it through VPNs, cash-based peer-to-peer trades, and offshore wallets. Annual transaction volume? Around $1.1 billion. That’s more than the entire fintech investment in Egypt after the ban.
People are buying Bitcoin with cash in parking lots. Selling USDT through WhatsApp groups. Trading on decentralized exchanges like Uniswap with wallets they control themselves. It’s risky. It’s slow. But it’s working.
And the government knows it. The CBE’s 2022 Annual Report admitted they struggle to monitor “decentralized finance applications.” They spent $3.8 million on blockchain analysis tools-and still can’t track it all.
The Hypocrisy of Egypt’s Digital Policy
While banning crypto, Egypt’s Ministry of Communications launched a national blockchain strategy in November 2022. They’re investing in blockchain for land registries, supply chains, and government records. They want the technology-just not the money.
It’s a contradiction that experts call “digital policy schizophrenia.” Why allow blockchain for bureaucracy but ban it for finance? The answer is simple: control. The government wants to own the ledger. They just don’t want people owning their own money.
Dr. Hanaa El Shenawy, a Cairo University policy analyst, put it bluntly: “They’re building the future with one hand and burning the currency of the future with the other.”
What’s Next? The IMF and the Future
Egypt is in a financial crisis. It’s negotiating an $8 billion bailout with the IMF. And the IMF has a clear message: modernize your financial system. Remove barriers to fintech innovation.
The IMF’s July 2023 report specifically called out Egypt’s crypto ban as a problem. They didn’t say “legalize Bitcoin.” They said “remove regulatory barriers.” That’s a crack in the wall.
Some analysts think Egypt will shift to a “controlled sandbox” by 2026-allowing institutional crypto trading under strict supervision, like Singapore or Switzerland. Others, like the World Bank, believe the ban will hold. Why? Because the government fears losing control more than it fears economic stagnation.
For now, the law stays. But pressure is building. The younger generation-tech-savvy, globally connected, and locked out of traditional finance-isn’t going away. They’re just finding new ways to bypass the ban.
What This Means for You
If you’re in Egypt: don’t trust any exchange that claims to be “legal.” There’s no such thing. If you hold crypto, keep it in a wallet you control. Don’t leave it on an exchange. And don’t advertise or promote anything crypto-related online.
If you’re outside Egypt and thinking about investing in Egyptian fintech: avoid crypto-related ventures. The legal risk is too high. Even if a company says they’re “compliant,” they’re not. There’s no legal path.
If you’re a developer or entrepreneur: Egypt’s ban is a warning. It shows how quickly a government can shut down innovation when it feels threatened. Don’t assume regulation is stable-even in countries that seem open.
The story of Law 194 isn’t just about crypto. It’s about power. Who controls money? Who gets to decide what’s legal? And what happens when a government chooses control over progress?
Is cryptocurrency illegal in Egypt?
Yes. Under Law No. 194 of 2020, all cryptocurrency activities-including buying, selling, trading, mining, and promoting-are banned unless approved by the Central Bank of Egypt. No approvals have been granted as of 2025, making crypto effectively illegal.
Can I use Binance or Coinbase in Egypt?
No. Egyptian banks are prohibited from processing transactions to these platforms. Most users report their accounts frozen or blocked. While some still access them via VPNs, doing so violates Egyptian law and carries legal risk.
Are there any legal crypto exchanges in Egypt?
No. There are no licensed crypto exchanges operating in Egypt. The Central Bank of Egypt has not issued any licenses for cryptocurrency trading or related services since the law took effect in 2020.
What happens if I get caught trading crypto in Egypt?
There are no publicly known cases of jail time, but the law allows criminal prosecution under Article 205. Authorities can refer cases to courts, and fines or asset seizures are possible. Many cases are handled quietly without public records.
Can I mine Bitcoin in Egypt?
Technically, mining is banned under Article 204 because it’s considered “issuance” of cryptocurrency. While enforcement against individual miners is rare, using electricity for mining could trigger scrutiny from authorities, especially if linked to large-scale operations.
Is Egypt the only country with a crypto ban?
No. Algeria and Iraq also have full bans. China and India have heavy restrictions, though not outright bans. Egypt’s ban is among the strictest in the Middle East and North Africa region.
Why does Egypt allow blockchain but ban crypto?
The government supports blockchain for public services like land records and supply chains because it can be controlled and centralized. Cryptocurrency, however, gives individuals financial autonomy-which the state sees as a threat to monetary control and economic sovereignty.
Will Egypt legalize crypto in the future?
Possible, but not soon. Pressure from the IMF and growing public demand may lead to a regulated sandbox model by 2026. But the government’s deep distrust of decentralized finance means any change will be slow, limited, and tightly controlled.
SHIVA SHANKAR PAMUNDALAR
November 27 2025Man, Egypt just out here acting like crypto is the devil when half the population can't even get a loan. They ban Bitcoin but keep printing pounds like it's confetti. I mean, what's the real crime here?