Crypto payments and blockchain trade finance: where Bangladesh stands

Global trade finance is entering a new phase in which blockchain is no longer viewed only as a crypto currency technology, but as infrastructure for faster, cheaper, and more transparent cross-border settlement. Around the world, banks, payment networks, and fintech firms are assessing stablecoins, tokenised deposits, and blockchain-based trade platforms to reduce delays in remittances, B2B payments, treasury flows, and export-import settlement. Mastercard and Yellow Card recently announced a partnership to explore stablecoin-enabled payments across Eastern Europe, the Middle East, and Africa, with an emphasis on cross-border remittances, B2B settlement, digital loyalty, and treasury management. Similarly, Ondo Finance, Kinexys by J.P. Morgan, Mastercard, and Ripple achieved a near-real-time cross-border redemption of tokenised US Treasuries, connecting the XRP Ledger with Mastercard's Multi-Token Network and J.P. Morgan's bank settlement infrastructure.
These global developments matter for exporters and importers because traditional trade finance still depends heavily on correspondent banking, paper documentation, cut-off times, manual checks, and delayed settlement. Stablecoins and tokenised deposits promise 24/7 settlement, faster liquidity flows, and improved payment visibility. At the same time, blockchain-based trade platforms can reduce document fraud, enhance audit trails, and accelerate the issuance of letters of credit. SWIFT itself has moved its blockchain-based shared ledger into MVP implementation to support interoperability between banks' tokenized deposits for 24/7 cross-border payments. The Federal Reserve has also analysed payment of stablecoins as a potential cross-border payments tool, while warning that such instruments carry monetary policy and dollar-exposure implications.
Bangladesh, however, stands at a cautious crossroads. On the one hand, the country has a strong export-import economy, a large remittance base, a growing freelance community, and a rapidly expanding mobile financial services ecosystem. On the other hand, the Bangladesh Bank has taken a restrictive position on private crypto currency and virtual assets. Its FE Circular No. 24 of 15 September 2022 states that virtual currencies are not recognized under the Foreign Exchange Regulation Act, 1947, are not approved foreign exchange or approved investment instruments, and transactions made in, from, or to Bangladesh for obtaining virtual assets or virtual currencies are not permitted. Bangladesh Bank has also clarified that retaining export proceeds abroad in virtual assets or crypto currencies may constitute a contravention of foreign exchange rules.
This means Bangladesh is not currently positioned to adopt open, crypto-based cross-border payments, as some global fintech firms are promoting stablecoin settlement. Any use of USDT, USDC, or other private digital tokens for export proceeds, import payments, remittance settlement, or freelancer earnings would face serious regulatory barriers unless the Bangladesh Bank creates a specific licensing or sandbox framework. The Payment and Settlement System Act, 2024, also reinforces Bangladesh Bank's authority over payment systems and payment service providers, requiring approval for electronic payment services and prepaid payment instruments.
Yet Bangladesh should not confuse crypto currency settlement with blockchain trade finance. The country is already making progress in digital trade infrastructure. Bangladesh Bank's FE Circular No. 06 of January 14, 2025 advised authorised dealers to introduce electronic options for LC-related communication, including transmission, advising, presentation, acceptance, and subsequent communication. Soon after, Prime Bank PLC executed Bangladesh's first Inland LC on a locally developed blockchain-based digital trade platform, with Dhaka Bank PLC acting as the beneficiary bank. This is a significant milestone because it shows that blockchain can be used to digitize trade documentation without using crypto currency as the medium of exchange.
Bangladesh's customs and trade infrastructure is also moving in the right direction. The National Board of Revenue and Bangladesh Bank launched a real-time digital interconnection between the Foreign Exchange Transaction Management System and ASYCUDA World, replacing manual commercial invoice verification and helping combat trade-based money laundering. Bangladesh Customs also operates the Import Export Hub, which provides HS-code-based information on import and export documents, compliance requirements, tariff rates, and duty benefits. These systems could become the foundation for blockchain-enabled trade finance if banks, customs authorities, ports, exporters, importers, and logistics providers can exchange trusted digital data.
The opportunity for Bangladesh is therefore not the immediate legalisation of crypto currency, but the structured adoption of blockchain technology to improve trade efficiency. Blockchain-enabled LCs, electronic bills, digital invoices, automated customs verification, and bank-supervised trade platforms could reduce processing delays, improve transparency, and help exporters access finance faster. The government's National Blockchain Strategy also supports blockchain as a technology for e-governance, innovation, and national digital capacity, identifying finance and trade-related use cases as part of the broader digital transformation agenda.
The challenges are equally serious. Bangladesh must manage foreign-exchange controls, AML/CFT risks, consumer protection, cybersecurity, the legal recognition of electronic trade documents, and interoperability across banks, customs, ports, and payment systems. Bangladesh Financial Intelligence Unit remains the central agency for combating money laundering and terror financing, and any future digital trade finance framework must integrate suspicious transaction reporting, KYC, sanctions screening, and trade-based money-laundering controls. The banking sector also needs investment in technology, staff capacity, and compliance systems before blockchain trade finance can scale beyond pilots.
For Bangladesh, the best policy path is a middle road: prohibit uncontrolled crypto settlement, but actively promote regulated blockchain trade finance. A Bangladesh Bank-led regulatory sandbox could test bank-supervised digital LCs, tokenised trade documents, e-invoice verification, and possibly limited stablecoin conversion only through authorised dealers with full reporting. Such a framework would protect foreign-exchange discipline while allowing innovation in export and import finance. The lesson from global markets is clear: blockchain will shape the future of cross-border payments, but successful countries will be those that combine speed with regulation, innovation with compliance, and digital ambition with monetary sovereignty.

Monzur Morshed Patwary is an International Banking and Trade Finance Specialist. mmpatwary90@gmail.com