If this should be the reason for their ban on Bitcoin, the use of money should be ban also because you can use money to carrying out the mentioned illegal financial activities.
Yes, their local currency supposed to be banned also. It can even get to the point that knives, cutlasses, gun and other things like that should be banned because they can be used to kill. There are still primitive governments in this modern era.
That side, Algeria government is taking the wrong step. They just want to deny the financial freedom Bitcoin will be bringing to the citizens of Algeria. It's unfortunate that the present government is misunderstanding what Bitcoin offers
All I can say is that we should hit worry, a time is coming when they will all realize their mistakes and accept bitcoin.