Saudi Arabia’s regulatory authorities recently issued a warning stating that cryptocurrency trading is considered illegal in the country.

The Saudi Arabian Standing Committee, which monitors securities activities in the kingdom’s foreign exchange market, reaffirmed that the use of Bitcoin (BTC) and other digital currencies is strictly prohibited. Members of the regulatory committee include the nation’s Monetary Agency (SAMA), its Capital Market Authority, officials from the Ministry of Interior, the Ministry of Trade and Investment, and the Ministry of Information.

“No Parties Licensed” To Offer Crypto Services

Notably, the official announcement against crypto trading has been issued after a number of local websites and social media accounts claimed to have been licensed or “authorized” to offer crypto-related services. The Saudi Arabian Standing Committee further clarified that “no parties or individuals are licensed for such practices.”

Moreover, Saudi regulators warned the country’s residents regarding the risks involved in the cryptocurrency market. Per the kingdom’s authorities, local investors should avoid dealing in digital currencies, not only because of their volatile nature, but also due to the large numbers of scams associated with them.

Additionally, Saudi regulators said that cryptocurrency transactions can be hard to trace, and crypto-related contracts offered to investors may not be legally enforceable “as they are out of government supervision.”

“Reducing Marketing For Investment” In Virtual Currencies

While Saudi authorities have been quite clear about their stance against cryptocurrencies, they have not stated what consequences there might be for individuals and organizations who may continue to trade or invest in cryptos.

However, the standing regulatory committee has been tasked with informing the Saudi government’s officials regarding any crypto-related activities in the country. It appears that the kingdom wants to “reduce marketing for investment and trading in Forex and virtual currencies”, according to its official announcement.

Earlier in February, Crypto Globe reported that Saudi regulators had been monitoring the cryptocurrency market. Mohammed ElKuwaiz, chairman of Saudi Arabia’s Capital Markets Authority, had said that the nation’s government was “evaluating what [their] proper regulatory response should be.”

Although ElKuwaiz had also stated that Saudi regulators would “come up with something very soon”, it now seems that the country may not be as receptive to cryptos, presumably due to the increasing number of fraudulent activities associated with them.

In October, 2017, Saudi Prince Al-Waleed bin Talal, a well-known business tycoon in the Middle East, had said that bitcoin will “implode.” He also noted that cryptocurrencies “don’t make sense [because they are] not regulated” by central banks.

Notably, the Saudi Prince even said that cryptos were “Enron in the making”, which was a giant American energy and commodities trading company that filed for bankruptcy in 2001, after it was charged with corruption and accounting fraud.