Topic: Using bitcoin for transactions in country where it is illegal. (Read 961 times)

I guess you're right. If you keep a low profile, there's no reason for the government to be suspicious about you. Would they be stupid enough to waste resources on a random citizen? I don't think so. Unless you're flagged as a criminal, there should be no reason to be worried about making BTC transactions under the table.

I guess people living in autoritarian countries like China and Russia are already doing this. Eventually, these countries will end up embracing the revolution. All just to fill their pockets with money (taxes). Hopefully, Bitcoin fulfills its mission of decentralizing the economy before it's too late.

Anything that has to do with legality you have to take it very seriously and if it's about bitcoin been illegal In some countries I think trading it might not be the problem for spending it as a currency might just be another new generational problem that might come up upon you because the country already have a recognized currency when it goes to exchange of goods and services and the law might just end up punishing the victim since every country have their own police's and the rest it will be better to just follow it, and I know trading bitcoin they won't stop but going beyond that. The court might dismiss when they know it's not that relevant because you need permit to spend an alternative currency by the government which is not recognized then the person have their self to blame, know the law and know what to avoid.

Thisjis a funny scenario and I don't think it can be attempted anywhere. Once something is banned in a country, there is no way the government will want to hear anything about it because it can be seen as a big offense. Reporting such a case to the police can even make the person that make the transaction to end up in jail. For cryptocurrency to be banned in a particular country, I believe their is a penalty for such a person and the government would not want to look into such a matter because it compromised the law that is guiding every citizens of such country. If something like this ever happens, the government can investigate the matter and send the both patties to prison for this.

We need to remember the fact of people getting p2p trades for shady coins as well. Like how do you think they can turn stolen bitcoins into cash without getting caught by the government? They use p2p for this transaction, and let the other person take the fall if they have to. They are doing something illegal anyways, and they are laundering their money this way basically, in the crypto world at least.

The end result would be, you see a deal where someone offers 5% even 10% discount, you think there is a great deal, you take the deal, they accept to go first, and actually do send the money to you, then you feel better about it and give them your cash, a bit time later law knocks on your door and asks you where you got it lol. So always be careful because anything could happen with any purchase, you are not going to get great deal out of this and you should be focusing on how you could make any document legit so you could show the law enforcement or the court if anything happens.

That only happens unless we are considered suspects and a danger that has long been on the government's radar . But if we were just ordinary citizens, no government would have the time or manpower to do those things .  No government would spend time creating traps to harm their citizens when we are just ordinary people, the government is not good but we don't need to think of them as that bad .

If I remember correctly bitcoin is not illegal in Nigeria, the Nigerian government lifted the bitcoin ban last year .  Although it is not recognized as legal currency, it is not considered illegal either.



https://www.reuters.com/world/africa/nigerian-central-bank-lifts-ban-crypto-trading-2023-12-23/

@Abiky

I wouldn't worry about meeting a cop or government agent for a bitcoin deal. Most countries don't have the time or resources to set up such operations. And they are limited with manpower. That's more a thing from movies.

I can see from OP's post history that he posts in the Nigerian local. Let's assume he is Nigerian. It isn't exactly an economic superpower in the world. Their government agencies have bigger fish to fry than catching bitcoin traders in the act. Unless, of course, we are talking about huge sums of money.

Governments don't care about us, don't serve us, but Bitcoin serves us from its root. So between Bitcoin and government, I will choose Bitcoin but I have to research on how to purchase Bitcoin, store it, and use it in a safe method, to avoid problems with governments legally.

If I can find good method to do it, why do I ignore a very good opportunity with Bitcoin?

It's what's happening around the world, with exponential growth of Bitcoin users with time.

Bitcoin adoption S-curve

If we are really good citizens, we will not use, not invest in bitcoin when it is considered illegal in our country. We have not been good citizens in the first place by using bitcoin and even using it to evade taxes.

If our country bans bitcoin, we better avoid anything that is considered illegal and that is the only way to protect ourselves. Don't expect the law to protect or condone our behavior when we know the law but still intentionally break it.

As of now, not many countries accept bitcoin as a currency or payment method, it would be a bad idea to use it as a currency and expect the government to protect us. We should think about the consequences of the problem before doing anything that is considered illegal in our country.

Of course. Nothing can stop him. But what if he deals with someone who's an undercover cop or government agent? They he'd be "screwed" for good. The risk is simply not worth it. I'm talking about meeting someone physically to make a deal. Online, though, it's another story. If the OP is careful enough not to disclose his personal info, he'll be safe. With Bitcoin adoption rising worldwide, I'm certain countries who once rejected it, will embrace it in the long run. As long as they're able to tax BTC effectively, nothing else matters.

Yes, that's right. Indeed, as good citizens we must obey the rules in the country where we are or the country we visit. Although bitcoin transactions are carried out with the consent of both parties, if the country prohibits transactions with bitcoin, it is better not to do it. because this is the same as a drug transaction, both parties agree but the country prohibits it, then it will be a criminal act and can be arrested. It would be wiser for us to use legal local currency for transactions.

In my country there was an incident of a transaction using crypto and both parties were eventually arrested. sometimes there are people like this who make the crypto world bad, as if crypto is a crime so that it is hated by the country that has banned it as a means of transaction. So it is wise to use crypto properly.

This is a case that happened in my country.
https://www.cnnindonesia.com/nasional/20230530135954-12-955787/polda-bali-tangkap-pengelola-rental-mobil-layani-transaksi-kripto

Please don't make the mistake of basing such a crucial decision on an internet forum, especially from advice given by total strangers. Consult a qualified lawyer instead. If Bitcoin is illegal in your country, avoid using it for any purchases. Even in countries where Bitcoin is legal, buying property with it doesn't make much sense. The reason is the taxman. You'll likely be creating a complicated situation with tax authorities by purchasing property with a non-legal tender.

Of course, each country will have different laws but in this case I think both will be investigated and both will be punished according to the law.

In this case: you mean the seller is almost not violating anything while he is the recipient of the bitcoin and denies it, and the buyer will be liable because he used the bitcoin?


What about the seller? Will he be fined? Buyers will certainly be fined for breaking the law by using bitcoin, but sellers cannot escape punishment either because the transaction cannot be completed without both parties reaching an agreement. It is clear that the seller is also involved in bitcoin trading and he is also breaking the law.

In any case, neither of them will end up well, so it's best not to break the law in the first place, especially when we're involved in high-value transactions.

Am sure that both parties wouldn't want to get arrested in a country where Bitcoin is banned and people get arrested for having or trading cryptocurrency or have apps for such crypto business.

Am sure that such kind of Bitcoin transaction that is even supposed to be a secret deal, will first receive confirmation of being credited the said amount of Bitcoin before the document of property is handed over.
There is so much formality these days mostly as it revolves around real estate business and documents such as C of O has to be an inclusive evidence as proof of ownership while the receipt of payment has to be made and documented as well for future reference.
In short, am sure that only wise and knowledgeable persons can make a deal like this and not have a dispute, because both parties has got their end to deal with.

Business people with large transactions will definitely not make silly deals. property sellers can ask buyers to exchange their Bitcoins for the agreed currency and valid in their country. that's what will probably happen.

But if the agreement has been made and the transaction is successful for both parties, what evidence will actually strengthen the case brought to court for legal proceedings? of course, because something is illegal, both of them will not make written evidence of the sale and purchase transaction using Bitcoin as a means of payment. they will make proof of payment using legal currency.

You should never enter into a Bitcoin transaction agreement with any party in a country that does not accept Bitcoin, i.e. where it would be considered a criminal offence.
If you want to do a business deal with a party, you must do the transaction in the local currency of that country, otherwise, if the transaction is done through Bitcoin, and if a party denies the transaction, then both parties will be punished in the legal trouble.

The law field is a very complex one so it is difficult to know what it may happen without a more specific example about where this may happen, after all if bitcoin besides being illegal to use for any transaction was not considered to be a valuable asset anyway, then the owner of the property being sold will have a massive advantage, as even if the bitcoin transactions could be corroborated to have happened, the court could say that no recognized asset was used for the purchase of the property, and that person could retain its property and the bitcoin that it was sent to them.

In countries where cryptocurrency transactions are banned using bitcoins is risky. If problem arises court decision is unclear. Proving payment with cryptocurrency does not guarantee success as court might reject it due to its illegality. Courts aim for fairness considering individual circumstances and local laws. Outcome could go other way  favoring buyer or dismissing case or requiring further investigation. Court must balance law and justice making predictions difficult. Additionally property owner false claims may still result in consequences.

I think a case like this is very unlikely to happen, especially in a country that strictly prohibits cryptocurrencies like bitcoin. Because logically, everyone in a country like that already knows that bitcoin or cryptocurrency is prohibited, so if for example there is a problem such as being cheated (using bitcoin/crypto), it is unlikely that the case will be reported to the police. Because you can be sure, if for example a case like this is brought to the police station, the problem will become even more complicated. It could be that both those who report and those who are reported are arrested, on the grounds that they have violated the rules in that country, namely carrying out transactions using bitcoin/crypto. So for sure, in my opinion, it is impossible for anyone to report such a case in a country where bitcoin/crypto is banned, even if the person was really cheated. Because as far as I know, in the realm of bitcoin or crypto, most people choose to remain silent when they are cheated. Because if for example this was announced to other people, it would definitely be very dangerous. Because it could be that after telling people about this, there are a handful of people who have evil intentions, such as robbery. Because currently people who are involved in the world of bitcoin/crypto investment are seen as truly rich people, especially by ordinary people. So if we experience a case like this, I think it would be better to keep quiet, especially if for example in a country that still prohibits bitcoin or crypto. And the conclusion from my answer to your question, it is clear that the person who reported the case and who was reported will be fined/penalized because they have violated the rules of their country's government.

For someone who has been using it and hiding it perfectly, I don't get why that person would pay up with crypto?
If crypto or Bitcoin is illegal in their country then both buyer and seller would surely face the charge.
The person who has been using Bitcoin or crypto in that country would surely knows a way to convert it into cash, so why would that person even need to pay with crypto?

Your example is excellent.

When government marks Bitcoin is illegal as a mean for any trade, like house trade and other trades, if you and your trade partner try to invade it by using bitcoin as a mean for the trade, risk rises from here.

Everything will be smooth if the trade is done without any problem from you or your trade partner. If the trade goes bad, with one of trade participants do things like scam, another trade participant will have big trouble. If he brings this trade to police, what police will do. Arrest the scammer if possible, forces him to refund money to the victim; but what will happen with the scammer?

I believe that bitcoin of the scammer will be seized.

The answer to this question will depend on how the law prohibiting bitcoin is written. But in general, in cases where the government declares bitcoin illegal, they will punish the person who used bitcoin to buy the house and they will also punish the person who accepted bitcoin as a means of payment for the house they were selling. And the government will seize the bitcoin and the house will also be seized if the person who received the bitcoins used the bitcoin. For example, if each house cost 9 bitcoins and the person did not use the 9 bitcoins, then the government will only seize the 9 bitcoins and will not seize the house.

Here we were talking about the issue of purchase-sale documents. but I want to add here that when people are getting involved in shady transactions, they don't use this method, they accept to be transferred the bitcoin and then make a document in which they are donating the house, in this case the person who paid in bitcoin appears to be just a beneficiary of the donation of the house and the government doesn't know that the house was paid for in bitcoin

If Bitcoin is illegal in a country, it simply means that the law does not recognise it. The court will declare that there was no financial transaction so the buyer might lose his money. The seller will also face some consequences if it is confirmed that he received Bitcoins. There is an allegation that he collected illegal money and might be investigated. If indicted for committing such a crime it can attract fines or jail term. The simple way to avoid such problems is to avoid using Bitcoin if it is illegal in your country. You might not lucky as people who have been doing it illegally. 

the best is like this. when we do something illegal, then report it, maybe we will get at least 2 bad things, the first is we can get punished for using bitcoin as a transaction where it is illegal in that country, the second thing will only add to the burden we have, it's like reporting something bad to the authorities, and we ourselves do it. So, I think it would be better to make transactions using legalized transaction tools, because it can help you when something unwanted happens.

as long as you're operating in a country where Bitcoin transaction are illegal, making payment through such medium should be entirely based on trust or through a reputable exchange and even at that, you have to have it at the back of your mind that should things go north, you don't have a choice rather than letting it go because you don't have a case in a court of law.

If you've made a payment to someone that refuse to acknowledge that he received the payment, if you're taking him to court, it's purely based on the fact that you're ready to drag the two of you down because regardless of how he says it, he's going to definitely face same penalty with you cause for agreeing to accept a payment in Bitcoin in a country where Bitcoin is illegal is a total crime that will involve the punishment of both the sender and the receiver.

Considering that, technically, Bitcoin is a censorship-resistant cryptocurrency, should we actually be "baffled" though? Although I may agree that "if it's illegal, don't do it", Bitcoin as designed may be the perfect solution to do something "illegal". The Truckers' Protest in Canada might remind you of that fact.

If a protester goes to BitcoinTalk and asks in a topic, "We are censored from using banks and payment processors, can we use Bitcoin?" - The answer would be YES.

There is always a smart dangling during such transactions of where related transactions is tagged illegal.

Normally there are some kind of transactions that would require third parties (middle man) or withness to testify that transactions was rightfully made.

We know that Bitcoin is one financial system which does not require any of those Parities due to Proof of Work (PoW).

So in this case, the best option for the buyer to stand a safer side of the transaction is if the Bitcoin payment was made in a custodial wallets or exchanges that requires KYCs where our personal informations are being updated in the network system in case the proof of payment is provided there would be no denial.

Other words... If the government have to prosecute me, both me (buyer) and the seller would all be at equal victim of violating the law. So,

I expect that the outcome of the trial will vary from country to country depending on the laws and the judge's legal view of the issue. This is a difficult legal controversy.

For me, I expect that if the country bans cryptocurrencies, proof of payment in cryptocurrency will not be accepted because first, it is not recognized and second, because he violated the law by using cryptocurrencies.

Or there may be another option that the judge will accept proof of payment in cryptocurrency but punish the buyer because he violated the law by using cryptocurrencies.

If bitcoin is not legal in your country then I don't see any need to trade bitcoin from your country. In such a situation, if you want to make a transaction, you can get caught in a lawsuit if the person sues you for endangerment because Bitcoin is illegal in your country. So you can't even get sued if you transact with bitcoin from a country where bitcoin is illegal. So you will be considered fully accused in the case. By converting bitcoin to local currency through p2p to stay hassle free, you will give your local money to your property owner and here you can keep the statement so that the property owner can't put you in any danger. Bitcoin is illegal in my country I never transact anything through bitcoin from my country I convert bitcoin to local currency through p2p from my country and transact with that local currency so far I have no problems.

After taking the case to the law court, the government will have to decide what to do since they are the ones that have the law of that country. To me, you think the buyer will face more problems than the seller because he will definitely pay for the property if he is still interested in buying the property, and after that, you will get punished by the government for disobeying the law of that country. And he will pay for the property in fiat. Although the seller may also get punished for accepting currency that is illegal by the government, I definitely know they must be punished. 

There are several risk factors attached to using gambling for transactions in a country where it is declared illegal. Because of the nature of Bitcoin, as a decentralized system, it has made it extremely difficult for the central government or any type of government to have control over the digital financial system. So, the government may not necessarily be able to completely stop the use of the bitcoin or cryptocurrency but you are more exposed to lost of your digital assets through seizures especially if such transactions are traced to any suspicion.

For instance, if your real estate transactions run in billions of dollars and the transactions were trailed to your account, government might find its way to seize such funds and the worse of it is that you cannot reclaim the lost financial assets through any legal process since it's already flagged as an illegal currency.

I'm baffled as to why this topic even exists....
If it is illegal - DON'T DO IT! Period.
Why would anyone want to be waving a red flag that says "I'm breaking the law"? Sure you may get away with it for a time but sooner or later you WILL be caught and prosecuted. Then there is the issue of getting scammed or robbed - you can't go to the police about it. I see NO upside to this.

I bet the person who was been swindled won't file a complaint because transacting in Bitcoin is illegal and the possibility of the victim going to jail is high.  It would be double trouble if the victim were found doing illegal Bitcoin transaction.
Instead of the court solving the case of the victim, the court will probably accuse the victim of money laundering due to illegal Bitcoin transactions and the culprit will probably convicted not because of swindling the person but rather because of illegal Bitcoin transactions.  So there is a huge chance that the dispute will be solved among the person involved and won't go to court.

If you live in a country where bitcoin transaction is illegal, why bother to buy a property with bitcoin? And why would the seller want to receive in bitcoin. They should simply accept fiat and use it to buy bitcoin themselves.

If bitcoin transaction is illegal in your country, paying with bitcoin means you didn't make any payment, because the transaction is not recognised by law. It's cool you avoid such payments in general.

OP should forget about big purchases like houses and expensive cars because his money comes from an illegal asset in his country. But no one can stop him from paying individuals in bitcoin and receiving goods and services in return. Also, no one can stop him from exchanging his bitcoin to fiat and using the cash however he sees fit. 

I am from Indonesia in here Bitcoin and some other cryptocurrencies are allowed, but only for commodities, not for the payment method. Regarding your mentioned case where Bitcoin was used in one particular property's payment, I have never seen anything like that happened but as far as I understand that transaction itself would not be considered valid in the court. Even if the buyer can prove that the Bitcoin payment was made, since crypto is illegal to use in transactions, the court would most likely side with the property owner if they claim never to have received the payment.

It is also dangerous, because if it goes to the court, any evidence that a crypto might involve could be discharged, and the buyer will be facing penalties for breaking Indonesian regulations. In countries like Indonesia, where cryptocurrency trading is regulated but not allowed for options of payment, it is safer to stay in line with the legality of modes of transaction on large purchases, such as through a bank transfer or in cash in advance when buying property.

Do you mean rent or do you mean buying/selling of the house? I don't know how it's in your country but I'll tell you how it's in mine.
Two people go together to the Public Registry, fill an agreement, get approval from the notary and in this process they agree on two payment methods, pay via cash or via bank transfer, there are no other options. I think that procedure will be similar in your country. In this case, you choose cash but behind the scenes, you pay with Bitcoin but here is the problem, you two didn't agree on Bitcoin payments, which means that you ruined the agreement and for a bonus, you made a type of transaction that's illegal in your country. You lose everything in this case, I wouldn't risk this. Probably I would buy this way from a very close friend or a relative but with strangers, you have no idea how honest they'll be.

The outcome of the case will be you need to pay the money for that person and you can get in jail because you break the law as Bitcoin is illegal in your country. Even if transaction can be used for evidence, as Bitcoin is illegal, you can not escape yourself from the law because using something illegal.

But that depends on the country situation so we don't know for sure with that. We don't have to use Bitcoin as a means of payment if Bitcoin is illegal. That will only give us trouble because that is written in the bill.

It will be a long process to solve the case I mean if that is success, the new owner need to change the old name in the property or other things, where that need proof if two people already make a transaction.  If they use Bitcoin as a mean of payment, the officials will be suspicious that they break the law.

NEVER, if it's illegal WRITTEN under law, use Bitcoin to purchase something, like property, or any other purchase if the proof of your identity and/or proof of payment is required/will be required.

BUT, as a censorship-resistant currency, no one can stop you as a user from participating in the Dark Markets, or from purchasing small items directly from your other Bitcoin peers. What would have been impossible to do in the world of centralized, institution-controlled payment systems is now possible through a decentralized cryptocurrency.

This is why it's good to obey the law of the land so that the law can fight injustice for you when you need it.

But first, Bitcoin transactions are always transparent and can be checked by anyone anywhere if the access to the website/app is not blocked. However, this case is different and technical at the same time and could end up in two ways.

Way 1, the judge might entirely disregard the case since it's a cryptocurrency transaction and it's already banned in the land. Way 2, the judge might decide to get justice for the victim and treat cryptocurrency as property if the victim could pay for all the needed verification means and claims he did use it in the country.

This is allowed and judges act on the case and not its extension but can only recommend additional investigation of the victim. The court may then hire a forensic verification outside the country to know the truth about the matter. The report is what the court would act upon, this will not flout the law of the land but treat the case.

Now that I read more Replies on this Thread I realize how much unreliability the information received through the Internet can be.  I can not comprehend how some people take legal advice from Chat GPT as reliable.  This sounds like a recipe for disaster.  Imagine getting caught for committing a murder and believing Chat GPT can help you avoid jail time.

I really REALLY doubt you are under any advantage only because you got Scammed.  To do this and ask Authorities to help is like a drug dealer asking Authorities to help them out because they received fake Money from their customer.

Although, it is NOT advisable to transact with crypto in a country where it is "illegal", the very nature of Blockchain (permissionless) allows anyone to access it at will. Laws/regulations can't be enforced on a decentralized network. Only on centralized exchanges and/or centralized wallet providers. What's stopping people from using crypto "under the radar"? Of course, expect to face fines or jail time if you're caught doing this. You'd need to decide whenever it's worth taking the risk or not.

I cannot tell whenever proof of payment on the Blockchain will be admissible in court or not. I'm not a lawyer, after all. My guess is that countries where crypto is "illegal", such thing will be outright rejected by the court. In countries where it is legal, this is still a regulatory "gray" area. It could or could not be admissible in court. With laws constantly changing, people would be better off using Fiat instead of crypto for day-to-day transactions. At least, that's what I think.

I don't know people do things these days but i can't pay for a property without a legal binding stating the means of payment, how much to be paid and signature from both parties. When there is a legal binding the need to obey the fact that Bitcoin is not legal for payment will be adhered to. But if they intend on doing it outside of the legal binding then proper video coverage of the transaction should be don't. If the example you gave is a real case scenario the buyer is foolish to have got into an agreement of paying in Bitcoin without any legal binding.

We all know that these days its either people cheating another or fooling the other. Thats why anything we are doing, we should be more careful, taking legal binding and an attorney serious.

Technically you have a valid point, any illegality can never get legal recognition that's for sure, but there ways this can be bypassed, say using a P2P service to send funds to a bank account then you have a binding paper trail to secure your asset without paying seller in crypto but fiat.

Otherwise crypto is here to stay, and you can't let the cheap coins to slide away especially if you have the interest and are invested...it pays to risk a little 

So far it seems that I have not heard for sure. But I know that there are some people or stores that accept crypto as a means of payment in my country even though it is banned. My country only allows limited crypto as a commodity asset. So those who accept only know and are silent then ready to accept the risk. If it is in accordance with the applicable law, the violation can be subject to a fine. This fine is divided into 2 for individuals and companies.  For individuals, the maximum prison term is 1 year and the maximum fine is $13,198. For companies, the maximum fine is $395,966.

Source: https://bphn.go.id/data/documents/99uu023.pdf (Indonesian Language)

You and I make transactions and use bitcoins as a means of payment. After you transfer me the money and the transaction is complete, I will silently delete the wallet in my phone and reverse the conversation that you never transferred bitcoin to me and that is not my wallet address. I even claim that I don't know what bitcoin is. In this case, how will you explain to the government while bitcoin is illegal, and who will testify for you that the wallet address you just transferred bitcoin to is my wallet?

Bitcoin transactions are public and we can track the transactions as well as the addresses where the bitcoins are transferred to but as I said, the wallet address is not linked to the user's identity. Meanwhile, if we use the bank, we can ask the bank to intervene to know whose account number it is and who owns it.

I do not think the court will consider this a valid case because the mode of payment is a currency that is not acceptable by law the both parties involved in the case might get punishment for using Bitcoin that is illegal in the country therefore the court would not recognise the case. If Bitcoin is not acceptable in your country, do not use it because the law is the law and we need to obey it before we find ourselves in situations that we do not have control over. There might be protest by Bitcoin enthusiast and this might help lighten your sentence but for countries that do not care about what other will say about them like Russia or North Korea, do not disobey the laws over there assuming they put a ban on Bitcoin transactions. The best thing to do in this situation is to relocate outside to countries that are okay with Bitcoin transactions.

This is a risk because in transactions of state-owned assets, all data, especially property, must go through legal means of payment, considering that this involves assets that are still within the scope of state control. Moreover, if the property is a recognised asset, then it is the right and obligation of the government to have the data of the transfer of the owner to the next owner, such as the method of payment signed on paper, witnesses and lawyers from third parties (usually representatives of local governments) The point is to administer the transfer of property. When both parties decide to use bitcoin (which has not been recognised or legalised by the government) automatically when the seller cheats the buyer by not acknowledging it, then the property can be taken back at any time. It doesn't matter if the buyer shows proof of Hash tx because from the beginning it was not a legalised method. Unless there is a history of agreement that can be used as strong evidence, for example a chat between the buyer and seller. But still, both parties will be caught in the law for making illegal transactions.

I think what @ Minor Miner is trying to say is that the recipient can still deny the transaction even after confirmation since he knows you can't open a case against him since bitcoin is illegal in their country so it's not like the transaction is not traceable, it is but just in a scenario whereby you deal with a dubious person and they know very well that you can't take legal actions against them since crypto transactions are restricted in the country. The best advice is just to respect the decision of the government or if you must make secret crypto transactions let it be with someone you trust very well and let it not involve a large amount of money.

Suing the other party to court will be the worst idea you should be considering. You will not only be implicating yourself, you might also lose the case because the court would consider a transaction done with an illegal currency void. In this kind of situation, it is best to settle out of court with dialogue. You (Op) would be needing sufficient evidence to prove that a transaction actually took place between you two. Gather as much evidence like wallet address, discussions leading to the transaction etc. If done thoroughly, the truth will definitely come out. I am sure the receiver of the bitcoin would not want to implicate himself too.

In all, be very careful. If possible, seek legal advice from a trusted lawyer.

I can understand the situation mentioned in the OP. But you need to understand that there are many countries where Bitcoins are still not legal. Hence, in such countries, doing these types of transactions is very risky. What the OP can do is make a legal notice and put a clause that you will send digital goods equivalent to the money. I am sure the court will use this to favor the case for you. Alternatively, you can hire a middleman or escrow to keep the funds. Once the property is fully transferred to you, then transfer the bitcoins from the middleman to the seller. These are the ideal options that I can currently think of.

This is a crucial case and I think it's going to affect the both parties especially the one that made the transactions in Bitcoin and why because all the claims would be on him and the fact that he's aware that the use of Bitcoin is prohibited that alone would extends the case and possibly make it worse. Aside knowing it's illegal and seeing proof of payment is a medium that such transactions was held and hence the victim is sure to face his penalty. People should be careful this days on how they go about crypto currency transactions because the government of such countries ain't smiling about it.

from the transaction ID, blockchain will indicate the address the BTC is been sent to, after it has undergoes steps of confirmation, using the payment we got from our signatures as example, when you check your wallet the explorer will give you total number of address bitcoin is sent to, so it's detectable unless you don't want to devote out time to check your transaction history, every transaction between you and someone with bitcoin is open and you can trace it, I have said it before that only conditions that can make you to loss your history of transaction is when you mixer to transact with multiple address, I know that it's not traceable.

But bitcoin wallet address is not like a bank account number linked to a user's identity. The recipient may deny that they have not received any bitcoin payment or say that it is not their wallet address or may even claim that they do not know what bitcoin is. That is why some members suggest that there should be a witness or intermediary when making a transaction. But having an extra witness also brings more risks because bitcoin is illegal in our country, the more people know we are using bitcoin illegally, the more risks we face.

In my opinion we should limit or avoid using bitcoin for large transactions if it is illegal in our country.

 If a country declares operation with cryptocurrency as illegal, there is no need for the citizens to take part in any crypto transactions except they are doing it with people they trust but yet it's not advisable because a misunderstanding might happen between them and they can't take any legal actions since crypto transaction prohibited. Going to seek legal actions when crypto transactions are restricted in that particular country will be like stabbing oneself.

When a case like this happens, then it’s better it’s settled without even taking the case to court, because the two parties are going to be punished for that. Since you already know bitcoin is illegal in the country, what they will ask first is why using it for transactions. I don’t really know, maybe the court will investigate the case to know who is trying to cheat, but I know at the end both the buyer and the seller are definitely going to be punished for making transactions with bitcoin. If you are in a country where bitcoin is illegal, make sure you make transactions with reliable people. If you are not confident with who you are making transactions with, then it’s just better to make use of the accepted currency in the country.

I don’t think the case will be thrown out, and any of them will be allowed to move freely, they will both be arrested, and will be pushed, for involving themselves in illegal activity.

I don't ever think the person who makes Bitcoin transactions will win a case like this because it is illegal and not allowed in the country. In fact, this can lead both of them into serious problems because both are involved in bad acts, and it is very possible they will both face the punishment the laws of the country may set for such crime. If something is not legal in any country someone is living in, it's a better idea to totally avoid it, as it could be a big crime and even lead to death. As for Bitcoin transactions, I am clear that someone should check whether the transaction is confirmed or not. I don't think there will be much lying on the side of the transaction.

That's not much case, their's something I notice very concerning bitcoin, once you make your transaction with bitcoin you will have transaction history in any wallet, you can go to your history and copy out your transaction ID and present it before law Court or as it maybe demand, I know basically that when you claim that you don't receive your payment from someone who sent bitcoin to you, with blockchain transaction history can tell if you have received or not, their's no way you can transaction data when you sent someone bitcoin.

What I want us to understand that their's nothing secret in cryptocurrency mostly Bitcoin, so therefore you have to understand that only way you can claim that if you have not received bitcoin someone use for payment, is a process the person use mixer for the transaction, because some of the mixers is not traceable.

Am sure the owner will never go to court unless he is also willing to go in jail because it is obvious that he have given consent to that bitcoin user accepting the payments when its against the law.

so the main thing here is never deal with illegal or face the consequences , am also sure that the bitcoin user will take advantage of the situation knowing that he cannot be bring to court for serious reason .

deal with cash , keep safe until the law changes and Bitcoin will open and allow in the future .

I beg to disagree with this; the contract is never valid because it doesn’t meet the definition of a contract.
As defined.
https://ironcladapp.com/journal/contracts/what-is-a-contract/

If a person needs a legal advice, it's right to take it from a lawyer. It's not safe to take the advice from any lawyer but it's worth to remind that advice must come from a lawyer with a professional branch in that specific field. Because a lawyer can not know about every thing in life, and only master in one or several fields he works in.

For example a lawyer with his field in cryptocurrency can not give you good legal advice on issues in immigration.

Two sources of money need to be clean, and you can have legal problems if you are a criminal and use dark money for the trade or if you receive dark money from your trade partner. I completely agree with this advice, that warns people to be more careful in any trade, especially in countries where Bitcoin and cryptocurrencies are considered as illegally.

Indeed, since lawsuits are based on the law, if there’s no law, then there’s no imprisonment. For example, if there’s no law punishing those who commit murder, then you wouldn’t be jailed if you killed someone. Basic explanation.

We don’t know the reason behind the person described in the OP, but one thing’s certain, they’re not aware of the law. However, If the transaction has already been completed, they could ask the seller to transfer the property as a donation. This way, the consideration of the money (bitcoin) received would no longer be relevant.

But if you already know that bitcoin is not legal in your country and you still try to use it for transactions. Basically, this is not a wise idea even if you have a witness because if you have to participate in a lawsuit, you may not be protected by the law in this case.

But I don't understand why we use bitcoin as a payment method when we have more convenient solutions? Especially since bitcoin is not legalized in our country, it's like we're driving ourselves into a dead end. Moreover, isn't it because we always want to protect our privacy that we choose bitcoin as a store of wealth? Why would we use it openly and even make a transaction that is considered illegal? If it were me, I would stay away from this from the start.

The state won't recognize the transaction if Bitcoin is illegal in a particular country. And here's the thing—the risk falls on the buyer because the seller could be a scammer who might later claim they were scammed, trying to take back the property. Even though the blockchain provides a public ledger as proof of the transaction, since Bitcoin is illegal in that country, the government won't assist in investigating and will side with the property seller. This makes it extremely risky to go through a legal process, which is crucial for acquiring property and transferring ownership.

I have to say, both of you will receive sanctions on your actions. It's like you know the rules, but you chose to break the rules and do something instead that is clearly against with it, so both of you will be investigated and if proven guilty, you will end up with punishments.

Just try not to insist doing things illegally. Because in the long run, whether you've taken it as your advantage, but court will always stick to its law. And no one is above or beyond the law itself.

I think it will be considered because in the court of law, every evidence is availed a chance of examination and untill proven not to be viable, it's upheld after which a fine or sentence can be passed on the other party for accepting an illegal form of payment and the payee will be given his own sentence for paying through such unapproved methods, I am not a lawyer but logically I think this may apply but otherwise I stand to be corrected.

In a country where crypto is not legal, it's even an offence to use it, which means the person who claims they have bitcoin and used it to make payment will be in trouble. 
 
And since the payment method used is not legal, it can't be considered a payment at all. The person will be asked to pay back if he or she really wants to keep that property. The payment and any fines levied on the person will be paid. 
 
There have been similar cases of such, but it was a luxury car purchase. I can't find the link to the case; I would have shared it here.

If such transactions are shown to court or law then both parties will have to pay the fines and may get behind bars for breaking the law. And, there's chance that both parties Bitcoin assets might get seized by the authorities once they learn about it. I think one should avoid Bitcoin transactions in a country where law doesn't allow it.

It would be bad for both sides if the buyer decide to expose the seller that he owns bitcoin and have been using it even though it is illegal in their country to use. For buyer side is that the property owner wouldn't say that he received the payment in bitcoin even though he really did get the payment and he can expose the property owner that he's been using bitcoin many times even though it is illegal in the country if he decided to exposed both of them. Also, it will be very suspicious when you suddenly have lots of money and will be curious where the funds came from.

I don't want to think about the rest of the story but my concern here is that no body can ever deny not to have received a Bitcoin transaction that have been successful confirmed because the evidence is not hidden. If anyone denies not to have received their payment that is successfully confirmed on the blockchain, they can look through their address to see if they have moved it out to another wallet and if such unauthorized withdrawal is made from the receivers end, the sender is not to be blame or hold responsible.

Any customer that tries to deny such payment in a country that Bitcoin is not legal is only trying to implicate the person that is making the Bitcoin payment.

If you are going to use bitcoin in a country which considers it to be illegal then I think a VPN would be recommended, but when it comes to transactions which involve big sums like buying assets such as a house then documents will be needed, if you can afford a lawyer to facilitate the transaction then do so to protect your transaction just to make sure you have this recorded somewhere!!

Never go the crypto way to buy assets without witnesses because the seller can easily say they dont remember receiving these funds or this didn't happen and you can be at a great loss.

In my opinion, it is better not to report to the police because it is risky, it is possible that the suspect and the victim will both be punished for using Bitcoin as a means of payment in their country which has clearly banned Bitcoin. It is better to use bitcoin for investment or trading if we are in a country that prohibits bitcoin, if we want to buy something then we must exchange Bitcoin into fiat money to be safer.

If you have Bitcoin and use a VPN or Tor every time you make a transaction and broadcast, then no one will know that you are a Bitcoin user. If you send someone a coin that way in your country and that person is quiet, i.e. it stays within you two, then you are safe. If bitcoin transaction is illegal and that person claims that he hasn't received Bitcoin, then that person is safe but if that person claims that he had to receive bitcoin but didn't receive Bitcoin and files a lawsuit against you, then he is in danger. If it's illegal, you definitely shouldn't provide proof of payments, if you provide, then you'll be in trouble. You shouldn't take that risk, you shouldn't make yourself dependent on someone else's honesty, especially in a case when your future can be ruined.
Seoincorporation gave you a good real-life comparison.

You are forgetting something very important: the source of the money. You can't just turn up with hundreds of thousands of dollars in cash and go, I want to buy a house. What's the source of your money, how did you obtain it? Can you prove how you earned it? Even if you wanted to pay taxes with illegally obtained funds, the tax office isn't going to accept it, and you will get into even bigger trouble as there will be an investigation into your business dealings.

I don't really understand the law. However, if a country has banned alternative transactions using bitcoin, and the person still uses it, I think the person will be punished. I don't know about the person who owns the property, but the person who made the transaction has committed a violation, and the law of the country has stated that it is illegal, and maybe to avoid something like this. so it all depends on the outcome of the court's decision. In my own country, bitcoin is also banned as an alternative payment, but it is allowed as an investment. So I only use bitcoin as an investment.

If bitcoin is illegal in a country, then you can't legally obtain property with it. Legal or not, you shouldn't pay for property with bitcoin without proper paperwork filled out and signed in front of a public notary. The seller can, of course, claim that you never paid for the property as there is no proof you did.

Both seller and buyer would be in trouble in such a scenario. They are breaking their nations laws by using a payment method the country doesn't recognize and deems illegal. You might as well pay with drugs, weapons, and stolen kidneys. The only difference is the penalties for such offences.

Actually no, it is already in their law so any transactions related to it possible you have a case fine will be sue on you because the first place you know already that's illegal, instead why not to convert your bitcoin into the local currency so you don't get a problem with the payment I know its just more way easier on it to pay but I guess its quite hassle for transaction at the same time there's a proof of payment and paper instead using the bitcoin and provide a transaction id. Depends on the decision and proof will be provided by the both party.

You will not benefit from taking legal advice from the internet, not to mention that this advice is for a scenario that is unlikely to happen.

The difference in interpretation of such a case will be in the real estate law, if it allows payment in any currency, then the sales contract is valid, but since you owned the house with illegal money, the house may be confiscated and you may be imprisoned, so the contract is valid, but you will cause yourself legal problems.

Do not take legal advice from the internet, including the advice above.

First, don’t use bitcoin for transactions in a country where it is illegal. IMO it’s not worth risking jail time for. Secondly, if there is a disagreement between buyer and seller, it cannot be taken to court because both parties may face jail time for breaking the law in the first place.

I don’t think this transaction is possible in a country where bitcoin is illegal. Buying real estate is different from buying groceries or making bitcoin payments online.  The purchase would require legal paperwork, the presence of a lawyer (on both sides), and a government agency.

It's true that the outcome will be bad for both of them because the receiver will be seen as guilty as the sender, it'll then be a case of an offender and accomplice. I think that the severity of their judgement will depend on the extent of Bitcoin ban in their country. Bitcoin transaction will always be private between two parties anywhere in the world if they don't involve any third parties like CEX and the receiver don't try to scam the sender. It'll be nice to share a real life experience so we'll practically know how it was resolved.

I asked GPT 4-o about it because I'm not a lawyer and AI is pretty good at such stuff on the basic advisory level. It said that the person who paid in Bitcoin and filed a lawsuit for being scammed is unlikely to get any compensation from the property owner by a court decision, and it is likely that the court would actually focus on the BTC user and persecuting him for using illegal payment option, although the scammer might face some kind of legal consequences as well.
So yeah, not a good situation for someone using Bitcoin for a major purchase in a country where Bitcoin is illegal.

Real estate transactions almost always require the consent of both parties and both parties will sign certain paperwork before the transaction can be completed. The buyer will never be able to use bitcoins for payment if the seller does not accept that request and provide the wallet address and that will definitely be mentioned in the contract. Not to mention, usually real estate sales contracts are only valid after being confirmed by government agencies, so I doubt this transaction would be possible in a country where bitcoin is illegal. So in case it happened, both parties are in danger, not only the buyer but also the seller is even charged with the more serious crime of intentionally appropriating another person's property.

It depends on how much money they have, if they're multi millionaire, they can bribe the police and they will be free. The one who use Bitcoin to buy property will not going to jail, while the scammer will going to jail, but only for few days and he will be free.

If they not have enough money to bribe, both of them high likely going to jail.

Never would I purchase something that requires paper work using Bitcoin in a country where Bitcoin is illegal.  It would be a very stupid move.  I may go to another country and purchase myself a Smart phone or a Laptop, I may go and get myself some clothing or eat at some Restaurants.  But I would not buy property such as cars or Real Estate if I could not do it using Bitcoin legally.  You would obviously set yourself up for failure and Scam attempts.  Because why would I want to accept an illegal Currency unless I had dubious motives?

If you are using Bitcoin in a country where it's illegal, then you are risking yourself in lots of ways. If are going to pay someone in Bitcoin for buying a property like lets say an apartment, but the other part has some devious motives and says they didn't get the money, you are pretty much screwed. Even if you have proof of transaction on the blockchain that you sent the funds, the justice departments will not recognize it since crypto transactions are banned there. The one selling you the apartment knows this very well and had it planned all along. Since no fiat currency is involved, the government wont do anything for you, but as soon as you try to make it a legal matter, you are ending up admitting that you did something illegal. All you will do is get into more trouble, while the counterparty escapes with your money.

Non custodial wallets are not KYC. No one knows you own bitcoin if you store it in a non custodial wallet (no KYC).

To protect your privacy with transactions, you need to use two things: Bitcoin full node, and Tor.

A beginner guide to Bitcoin Privacy

When you're doing illegal things, make sure you don't trade with a scammer. Because if you are scammed, you will be less ready to file a report to police or government for support.

Both of you will have sentences from the court, like jails. Because in this trade, both buyer and seller broke the national law. If one of you are scammer, the sentence for the scammer will be stricter by doing illegal things, and scam.

If using bitcoin is illegal. the buyer would be in danger. If he takes the case to court, the focus will shift into him. 'Why were you using bitcoin in the first place?' They would ask him so not only do I think the court will not recognize the buyer's claims, I think they might even punish the buyer for using bitcoin. In reality, if this happened to the buyer in a country where bitcoin is illegal, I am sure he would not want to take this to court afraid of getting consequences himself or just wasting time.

Plus cases like this will fuel the already existing hatred of the country to bitcoin. If this hit public, the government will basically be saying 'I TOLD YOU SO. DO NOT USE BITCOIN.'

... But why would they use Bitcoin? I reckon there are a bunch of other methods out there that they're able to use to convert that Bitcoin into fiat. But considering the situation, I'd say it depends on the laws of the country? I reckon there's some lawful agreement before the sales of any property so they'd have to write up some contract or something and they'd have to talk to a lawyer about that. That should pretty much cement that they can't use Bitcoin since it's not legal right there tbh.

But let's say it DID get through for some reason, I'm pretty sure before anything else, they'd both get arrested just for the fact that they're both transacting in Bitcoin, regardless of the result. The government might even take the Bitcoin themselves.

That's indeed debatable.

What are the repercussions for using bitcoin in the specific country? because laws could differ in each country. If it's something like a paying a doable fine then it is worth considering bringing the case to a lawyer for a legal advise. It could be risky if there is a jail time lol.

Ultimately, you'll have to weigh down the pros and cons plus check in with your risk appetite.

When a country's regulations have been set, then:
what is prohibited will still be illegal when done,
and when done, it means breaking the rules.
and if you break the rules, you will be subject to sanctions,
if caught and proven guilty.
The point is in this

there must be proof from both. However, here, the Bitcoin sender has a greater loss. Even if he can prove the transaction transfer, but the recipient claims that the wallet is not his, then the sender will really lose.

However, as far as I know, if you are going to make a transaction that is so big, such as buying property, there must be something called a sales and purchase agreement, including an agreement regarding payment details, invoices, and proof of payment, then there is a deed of purchase through a notary. So if it is stated in the agreement that the transaction was made with Bitcoin and the recipient's wallet is listed, then the recipient will not dare to file this in court because they understand the consequences, in fact both of them will lose.

And it seems difficult to deny, because basically, there will be proof of chat for sending transactions and others. '

If the case is like this:
There is no agreement letter, no chat evidence, and no witnesses to support it, then:
the sender is someone who is very careless and may be easily deceived. And this is a fatal mistake because it is easy to trust or carelessly spend money even in Bitcoin for transactions without evidence, witnesses, and others. So in this case, the Bitcoin sender is the one who will suffer a big loss.

When it borders on fraud, the law will first of all act to protect the party involved not to lose their money, and since the transaction in bitcoin is not hiden, it won't take the court too much effort to verify wether or not the money was credited via bitcoin since the sender should be able to provide transactions trx and also the receiver provides his address with agreements.

And after then the law can now take it stand on why the both party deal on bitcoin knowing that the government have banned it transactions, so this is not a big problem issue at all, and in most cases, both parties can easily settle out of court to avoid penalty from the law.

Both of you will be in subject of investigation and for sure will be proven that both of you use bitcoin then might go to jail with that or pay penalties. So to avoid getting any issue much better don't use bitcoin for doing p2p transaction.

Much better that you should use bitcoin for investment purposes only since its dangerous to transact using this knowing that government declare it as illegal asset. So always use fiat when dealing something since this is more ideal to use especially when we talk about safety.

To many crazy things that we don't want to happen so we always choose safety over our wants to transact using bitcoin.

The thing is bitcoin isn’t like those kind of traditional monetary system where you have cases like that, transaction will are stored public blockchain so it will be crystal clear maybe it was received after sent or not. So except the receiver wants to scam the sender the transaction will be visible for him to see.


Ok let’s assume it got to this place, the case cannot be taken to court because both parties will be held liable to doing cryptocurrency transactions which was presumably unlawful and illegal and that will only make law breakers, moreover the court wouldn’t attend to this case before it is not under constitution laws. So the sender would have give up this case sadly

I think haven't followed court proceedings and how the law operate in most cases, the law will hold the person sending the Bitcoin as means of payment and the property seller receiving the Bitcoin, as first and second offender of the law. the issue of who received payment and who did not receive payment will be immaterial, as both of them will be culpable for breach of the law, hence the relevant sections of the constitution concerning law offenders on that subject matter will be read out to them. Because it will be assumed that they both know that bitcoin activities in the country is illegal, so they will be held for breach of the law.

Assuming that the complainant isn't a person of influence and also assuming that the judge and jury isn't corrupt, then the defendant would need the services of top notch lawyers to plead his case. The law is neither black nor white there are some grey areas that I believe can always be exploited by the lawyers to turn the case in the favor of their client. An unrelated and humorous example is like that of a prisoner sentence to life in prison but then died and was resuscitated. He argued that he had already served his life sentence since he died... I don't know how the story ended but you get the point I am driving at already.

The final verdict will probably depend on the country and how the laws work there. Suppose it's a country where there is respect for the law and there is no corruption or anything. In that case, the court will ask both parties to submit proof, such as the buyer should show proof of the payment since he claims he made the payment, and the seller will then need to prove that he didn't receive the transaction considering the seller sent the funds in a wallet that can be linked to the buyer in some way. If he sent them in an unknown wallet, I don't know how they will be able to prove that the address belongs to the seller, so that can be a negative point for the buyer.

However, if the buyer can prove that the address receiving the funds belongs to the seller then the court will surely investigate to find out if the funds are received or not, and if received, they will either be returned or confiscated considering the use of cryptocurrencies is illegal within the country, and the buyer might be charged a penalty or something for it.

One thing in this case is clear, the buyer will not get out of it without any trouble because you are using cryptocurrencies when it's illegal, even if the seller doesn't get away with it and with the funds, the court will probably not let the buyer have the funds as well unless they charge him a heavy fine on it.

The outcome would be bad for both sides, if the owner claim that he didn't get the money in bitcoin he could go to jail for the fact that he was making a deal with bitcoin.

Is like someone buying cocine and claiming that he didn't get the cocine, it's a ilegal activity and buyer and seller should get in troubles if they decide to deal the situación with the Police.

It will not be advisable to make transactions in bitcoin within a country where cryptocurrency transactions are illegal by the law. But Imagine this scenario that someone has been using their bitcoins for transaction secretly successfully, and then one day decides to use the bitcoin that they have to make payment for something like a property to the owner of the property, If there is this kind of problem for instance where the owner of the property decides to claim that they did not receive any money in bitcoin, and the case is taken to a law court, what do you think the outcome of the case will be?
If proofs of payment are provided but in cryptocurrency, do you think the court will consider it even though transactions are tagged illegal with it? or will the case be thrown out and the owner of the property with the false claim of not receiving the money be allowed to go freely?