Cryptocurrency Restrictions in Ecuador: What You Can and Can't Do in 2025

In Ecuador, you can buy Bitcoin. You can hold Ethereum. You can even trade crypto over the counter with cash in Guayaquil. But if you try to send money from your bank account to Binance, it gets blocked. If you use a credit card to buy crypto, the transaction fails. And if you mine with a rig in your garage, you’re fighting 35% import taxes on hardware, rolling blackouts, and electricity bills that cost nearly 15 cents per kilowatt-hour. This isn’t a ban. It’s a cage.

Nothing is legal - but nothing is illegal either

Ecuador doesn’t have a law saying you can’t own crypto. But the Central Bank of Ecuador (BCE) made it clear in August 2024: cryptocurrencies are not legal tender and not authorized as payment. That’s it. No criminal penalties. No fines. Just a wall of silence from the government. You won’t go to jail for buying Bitcoin. But you also won’t get help if you get scammed.

This gray zone exists because Ecuador dollarized its economy in 2000. The US dollar is the only official currency. Any alternative - even a digital one - threatens that system. So instead of banning crypto outright, the BCE just refuses to acknowledge it. Banks, payment processors, and insurers are legally required to block any transaction tied to crypto. The Superintendency of Banks keeps a public list of banned exchanges. If you’re using Binance, Kraken, or OKX, you’re already on their radar.

How do people actually buy crypto in Ecuador?

If you can’t use your bank, how do you get crypto? The answer is: peer-to-peer (P2P). And it’s messy.

Most Ecuadorians who own crypto use platforms like Mercado Bitcoin, LocalBitcoins, or Telegram-based OTC desks. You find someone in your city who wants to sell Bitcoin. You meet in a café. You hand them cash. They send you USDT or BTC. No paperwork. No KYC. Just trust - and risk.

That’s why premiums are high. On average, crypto in Ecuador sells for 8-12% above global prices. Why? Because liquidity is low. There’s no exchange. No market maker. No competition. Sellers know you have no other option. A 2024 OWNR Wallet survey found that 68% of crypto users in Ecuador receive funds from family abroad - usually in stablecoins - and then convert them to cash through these informal channels.

And it’s dangerous. One in four Ecuadorian crypto users reported being targeted by fraud. Fake sellers. Fake buyers. Scams disguised as OTC deals. The Reddit community r/CryptoEcuador has over 1,200 members, and half the posts are about frozen accounts, stolen funds, or bank warnings.

Why is banking so strict?

Ecuador’s banking system is built around the US dollar. The BCE doesn’t want competition. It doesn’t want volatility. And it doesn’t want capital flight.

In Q4 2023, Ecuador saw $1.2 billion in unexplained money leaving the country. The BCE blames crypto. Critics say it’s just a convenient excuse. The real issue? Only half of Ecuador’s adult population has a bank account. That’s 5 million people cut off from formal finance. Many of them send or receive remittances - $3.8 billion a year - with fees as high as 6.3%. In Mexico or Colombia, people use crypto to cut those fees to under 2%. In Ecuador? They can’t.

Banks aren’t just being cautious. They’re forced to. The Monetary and Financial Policy and Regulation Board (JPRM) issued resolutions in 2022 and 2023 that explicitly ban crypto as a payment method. The Superintendency of Banks enforces it. If a bank processes a crypto transaction, it risks losing its license. So they block everything - even transfers to wallets you own.

What about mining?

Mining isn’t illegal. But it’s practically impossible.

Electricity costs $0.145 per kWh - 23% higher than the Latin American average. Power outages happen 14.7 hours a month on average. And if you want to buy a mining rig? You pay 35% in import duties on top of the price. Most miners are hobbyists with one or two ASICs tucked away in Quito or coastal towns. The entire country’s hash rate? Less than 0.0001% of the global total. That’s not a threat. It’s a footnote.

No mining pools operate in Ecuador. No industrial farms. No crypto-friendly data centers. Just a few people trying to make a few dollars a month while their lights flicker.

Taxes - yes, you have to pay them

Even though the government won’t recognize crypto as money, it still wants a cut. The Internal Revenue Service (SRI) treats crypto gains as taxable income. If you sell Bitcoin for USD and make a profit, you owe tax. Individuals pay up to 35%. Companies pay 25%.

But here’s the catch: no one tracks it. The SRI doesn’t have access to blockchain data. There’s no reporting requirement. No Form 1099. No IRS-style audits. So most people don’t report. But the law is there. If you’re caught, you’re on the hook.

How does Ecuador compare to its neighbors?

Ecuador is an outlier in Latin America.

- Peru requires all crypto exchanges to register with the Financial Intelligence Unit (UIF) as of June 2025.
- Mexico has had a fintech law since 2018 that licenses crypto service providers.
- Paraguay allows crypto payments and mining under a 2022 law with AML rules.
Ecuador? Nothing. No licensing. No registration. No legal framework. Just warnings and blocks.

The UN’s ECLAC called this approach “contradictory.” With half the population unbanked, and remittance costs so high, crypto could be a lifeline. Instead, the government pushes it underground.

What’s next for crypto in Ecuador?

There are signs things might change - slowly.

In early 2025, new rules will require fintech startups to incorporate as sociedades anónimas, carry $200,000 in capital, and get special registration to offer tech-based financial services. That’s not crypto-specific, but it’s a step toward formalizing digital finance.

The BCE is also testing a Central Bank Digital Currency (CBDC) - a digital version of the US dollar. If it launches, it could create infrastructure that eventually supports regulated crypto services. But the BCE says the CBDC is about “modernizing small payments,” not enabling Bitcoin.

Analysts are split. Some predict regulation by 2026. Others say the BCE will hold firm until 2027 or beyond. The fear? Capital flight. The reality? People are already moving money - just without oversight.

What should you do if you’re in Ecuador?

If you want to use crypto here, here’s what works:

• Use P2P platforms like Mercado Bitcoin or Telegram OTC desks.
• Pay in cash. Never link your bank account.
• Only deal with people recommended by local communities. Check Reddit and Telegram groups.
• Keep records of your trades. You might need them for taxes.
• Don’t trust any exchange that claims to be “licensed in Ecuador.” There are none.
• Use hardware wallets. Never leave crypto on an exchange.

And don’t expect help from the government. There’s no consumer protection. No dispute resolution. No hotline. If something goes wrong, you’re on your own.

Why does this matter?

Ecuador’s crypto restrictions aren’t just about money. They’re about control. The government chose dollarization to stabilize the economy. But in doing so, it locked out innovation. People who need financial tools - the unbanked, the remittance-receiving families, the small business owners - are left with risky, expensive, and illegal workarounds.

The result? A $135 million crypto market in a country of 18 million people. Compare that to Colombia’s $1.2 billion or Mexico’s $8.9 billion. Ecuador’s economy is growing. Its people are tech-savvy. But the rules are stuck in 2000.

Until the BCE decides that financial inclusion matters more than control, crypto in Ecuador will stay in the shadows - useful, dangerous, and always one step ahead of the law.