{"id":14774,"date":"2022-11-24T09:55:45","date_gmt":"2022-11-24T09:55:45","guid":{"rendered":"https:\/\/crowdfundjunction.com\/blog\/better-regulation-of-africas-growing-crypto-market-urgently-needed-africa-bitcoin-news\/"},"modified":"2022-11-24T09:55:45","modified_gmt":"2022-11-24T09:55:45","slug":"better-regulation-of-africas-growing-crypto-market-urgently-needed-africa-bitcoin-news","status":"publish","type":"post","link":"https:\/\/crowdfundjunction.com\/blog\/better-regulation-of-africas-growing-crypto-market-urgently-needed-africa-bitcoin-news\/","title":{"rendered":"Better Regulation of Africa’s Growing Crypto Market Urgently Needed \u2013 Africa Bitcoin News"},"content":{"rendered":"

(Originally posted on : Bitcoin News )<\/b>
\n<\/p>\n

\n
\n<\/header>\n
\n<\/div>\n

A well-regulated African cryptocurrency market is needed in order to protect users as well as help countries stop bad actors from using digital assets to circumvent capital controls, the latest post on the IMF blog has said. The blog post reiterated the IMF\u2019s belief that risks to a country are \u201cmuch greater if crypto is adopted as legal tender.\u201d<\/strong><\/p>\n

Crypto\u2019s Volatility Said to Render It an Unsuitable Store of Value<\/h2>\n

The collapse of the cryptocurrency exchange FTX and subsequent crypto market downturn once again highlights the need for better regulation of the industry, the International Monetary Fund (IMF) has said in its latest blog post<\/a>. According to the blog, in Africa, where the crypto market is rapidly growing, urgent action is also needed in order to block or stop bad actors from using crypto assets to facilitate illegal activities.<\/p>\n

As per the global lender\u2019s latest blog post, only a quarter of countries in Africa\u2019s sub-Saharan region formally regulate cryptocurrencies. However, in the Bretton Woods Institution\u2019s latest post known as the \u201cChart of the Week,\u201d it is stated that over two-thirds of countries from the region have implemented some restrictions.<\/p>\n

Only six countries, namely Cameroon, Ethiopia, Lesotho, Sierra Leone, Tanzania, and the Republic of Congo have effectively banned crypto, the blog revealed. Zimbabwe, on the other hand, directed banks to stop processing crypto-related transactions.<\/p>\n

While the authors of the Nov. 22 blog post did concede that \u201cmany people use crypto assets for commercial payments,\u201d they insisted that crypto assets\u2019 volatile nature makes them unsuitable alternative stores of value.<\/p>\n

Wider Use of Cryptocurrencies Potentially Undermines the \u2018Effectiveness of Monetary Policy\u2019<\/h2>\n

Besides the volatility, the authors also claimed that African policymakers are concerned that crypto assets are being used to bypass countries\u2019 respective exchange and capital controls, noting:<\/p>\n

\n

Policymakers are also worried that cryptocurrencies can be used to transfer funds illegally out of the region and to circumvent local rules to prevent capital outflows. Widespread use of crypto could also undermine the effectiveness of monetary policy, creating risks for financial and macroeconomic stability.<\/p>\n<\/blockquote>\n

Concerning the Central African Republic (CAR), which has already made bitcoin legal tender<\/a>, the authors reiterated the IMF\u2019s belief that such a decision places \u201cpublic finances at risk.\u201d The move by the CAR also contravenes the Economic and Monetary Community of Central Africa (CEMAC)\u2019s treaty on cryptocurrencies.<\/p>\n

Register your email here to get a weekly update on African news sent to your inbox:<\/em><\/p>\n

What are your thoughts on this story? Let us know what you think in the comments section below. <\/strong><\/em><\/p>\n

\n
\n<\/div>\n
\n
\nTerence Zimwara <\/h6>\n

\nTerence Zimwara is a Zimbabwe award-winning journalist, author and writer. He has written extensively about the economic troubles of some African countries as well as how digital currencies can provide Africans with an escape route.

\n
\n
\n<\/a>
\n<\/span>
\n
\n
\n
\n<\/a>
\n<\/span>
\n
\n
\n
\n<\/a>
\n<\/span>\n<\/p>\n<\/div>\n<\/div>\n

Image Credits<\/b>: Shutterstock, Pixabay, Wiki Commons, rafapress \/ Shutterstock.com<\/em><\/p>\n

\n

Disclaimer<\/strong>: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com<\/a> does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.<\/p>\n<\/div>\n

\n