Erbil bans Forex, USDT trading and warns of legal action

ERBIL, Iraqi Kurdistan region,— Security authorities in Erbil on Tuesday issued a strict ban on trading in digital currencies, warning residents against engaging with online Forex and virtual currency platforms.

The General Directorate of Security (Asayish) confirmed in an official statement that dealing with virtual financial assets such as Forex and USDT (Tether) is forbidden in the Kurdistan Region and Iraq. According to Asayish, companies offering these services operate without any license or oversight.

“These platforms are unauthorized,” the statement said. “No legal framework exists to support their operation in Iraq or the Kurdistan Region, and they are not recognized by the Central Bank of Iraq or financial ministries.”

The move comes in response to a growing number of complaints from the public, many of whom reported monetary losses after investing in unregulated markets promoted through social media.

The statement emphasized that promotional activities by brokers and trading platforms have led to confusion and misled citizens. Officials urged people to be cautious and refrain from investing in any form of electronic currency.

“We advise the public not to trust advertisements and not to risk their money with these platforms,” the agency stated. “These deals are not legal, and we will take measures against those promoting them.”

Asayish also warned companies and individuals not to advertise digital currencies, stating that legal action would be taken against any violations.

Digital trading, though popular especially among young people seeking extra income, remains unmonitored by Iraqi and regional financial authorities.

In February, both Rafidain Bank and Rasheed Bank in Iraq released public advisories warning of the dangers of using virtual currencies, aligning with the broader government stance against unregulated financial tools.

As many people in the Kurdistan Region seek fast financial returns with limited investment knowledge, security experts are raising concerns about the rising number of scams.

These scams often target individuals with promises of quick profits and easy wealth, but typically lead to significant financial losses.

In particular, unauthorized companies offering schemes like multi-level marketing (MLM) and other fraudulent investment opportunities have become increasingly prevalent.

These firms lure people in with promises of high returns, only to disappear with their victims’ money once they have collected enough investments.

Experts warn that any investment offer claiming to guarantee massive profits should immediately raise suspicions.

According to financial specialists, “If an offer sounds too good to be true, it likely is.” This caution comes as many in the region have already lost hundreds of thousands of dollars to such scams.

The rise of these deceptive practices has left many individuals, particularly those with limited education or financial experience, vulnerable to exploitation. With the lack of regulation and oversight, these schemes continue to spread, further exacerbating the problem for ordinary citizens seeking to secure a financial future.

Authorities continue to warn the public about such risks, advising people to be cautious and skeptical of any investment that promises extraordinary returns with little risk.

Forex trading carries significant risks, primarily due to its volatility and the leverage often involved. Traders can experience rapid gains, but losses can be equally swift and substantial, especially when trading on margin.

The market’s unpredictable nature, combined with global economic factors, makes it challenging to forecast price movements accurately.

Additionally, because the forex market operates 24 hours a day, it can be difficult for traders to monitor their positions constantly, increasing the chances of unexpected losses.

These risks make forex trading highly speculative and unsuitable for inexperienced investors.