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Bolivian Authorities Arrest 60 Bitcoiners, Reiterate Virtual Currencies as Illegal Pyramid Schemes

Last Updated March 4, 2021 4:56 PM
Francisco Memoria
Last Updated March 4, 2021 4:56 PM

Recently, the Bolivian Financial System Supervision Authority (ASFI) arrested 60 people for carrying out “training activities” related to the investment in virtual currencies such as bitcoin, according to a press release  published by ASFI.

Bolivia is one of the few countries in the word in which bitcoin is outright declared illegal. In 2014 the country’s central bank, El Banco Central de Bolivia (BCB) officially banned  all currencies that weren’t issued or regulated by a government or an authorized entity. The Latin American’s government and central bank believe virtual currencies are a pyramid scheme that only exists to steal people’s money.

The Bolivian bitcoiners were arrested for seemingly distributing bitcoin-related pamphlets at the Cine Center of Santa Cruz de la Sierra, and possibly planning to sell or mine bitcoin, as according to the statement they were gathered and “carrying out training activities related to the investment of money with characteristics of multilevel schemes”.

Lenny Valdivia, Executive Director General at ASFI, stated:

We confiscated pamphlets relating to business schemes that go around giving training and making business plans regarding virtual currencies that are operating abroad. The Bolivian population should not be fooled, it should not participate in closed [virtual currency-related] groups through WhatsApp. The only thing they are doing is taking advantage of the population, deceiving the people to appropriate their money.

The ASFI restated in the press release that bitcoin and other virtual currencies are, as of May 6, 2014, banned in the country and that it would continue to go after Bolivians who promote cryptocurrencies. Valdivia asked the population to actively denounce similar cases so that Bolivians can take care of their savings and of the economy of their families, according to the statement.

The press release ends stating that ASFI is currently working towards drafting regulations that will allow the inclusion of pyramid schemes in the country’s Penal Code, to help fight those who engage in similar virtual currency-related activities.

Bitcoin Crackdowns

Bolivia isn’t the only country in which bitcoiners are having a hard time. In Venezuela, a country in which cryptocurrencies allow the people to circumvent the government’s currency controls, four bitcoin miners who were allegedly operating over 300 mining machines, have been arrested earlier this year, as they were accused of electricity theft and cyber fraud.

As a matter of fact, bitcoin has been targeted in the country ever since hyperinflation struck the Venezuelan Bolivar and cryptocurrencies became an alternative. As part of the government’s attacks on bitcoin, Venezuela’s state-owned internet service provider CANTV outright blocked several bitcoin-related websites and mining pools.

Venezuela’s crackdown was followed-up in February, when authorities took down a mining center in Valencia in Carabobo state. At the end of the day, bitcoin continues to be a safe haven for Venezuelans, as peer-to-peer trading volumes in the country have been growing. Just last week, a Redditor claimed that bitcoin is what was keeping his family from starving  in Venezuela’s impoverished economy.

Featured image of Bolivian Police from Shutterstock.