IMF Urges Nepal to Regulate Crypto as Flows Hit 8% of GDP in 2024 Despite Ban

According to the International Monetary Fund (IMF), on Tuesday, Nepal's crypto flows grew markedly between 2019 and 2024 despite a legal ban, peaking above 13% of GDP in 2021 and reaching approximately 8% of GDP in 2024. The IMF, which released the finding in its 2026 Article IV Consultation on June 5, urged Nepal to establish a regulatory framework aligned with international standards to protect financial stability and curb illicit flows. The Fund warned that unregulated crypto could be used to evade capital controls or trigger large-scale deposit outflows.

Nepal banned all crypto transactions in 2021, with inflows remaining negligible in 2020 before surging to $2.6 billion in 2021. Stablecoins now make up the larger and growing share of crypto adoption in the country.