African Regulators Play Waiting Game With Crypto
Nations within Africa are looking to regulate cryptocurrencies although no single country is currently making the first move in terms of applying any regulations amidst the unprecedented developments of the tech and asset class as per a new report by Ecobank, the largest standalone banking group providing services to almost forty countries within Africa.
The Waiting Game
According to the report, research into the regulatory initiatives in regards to digital currencies by 39 African countries has revealed that many of the regulators within these countries are essentially waiting to see how any regulations placed first by close nations will pan out before implementing their own as essentially updated and enhanced versions of neighboring regulations.
Ecobank has stated that many countries within Africa are waiting to see how adjacent countries are applying their regulations first, learning from the mistakes made and implementing their own regulations later with improvements as opposed to taking the initiative and taking the first step. He adds that governments in Africa are concerned about residents becoming too used to cryptocurrency investments in general and worry about a possible economic crash in the future and thus, governments are hesitant in their decision to license cryptocurrencies for the public.
Out of 39 researched regulatory protocols, 21 of the involved countries have not yet made any public decisions regarding the technology and its regulation. So far, only three nations have made adamant stances regarding crypto. Namibia has completely banned all cryptocurrency related activities while South Africa and Swaziland more positive stances regarding digital currencies and end their positivity just short of a full adoption and legalization.
The remaining 15 are, as of now, in a grey area and have refused to directly implement regulations on crypto, saying that BTC and other digital currencies remain in an untrusted part of the legal system and have issued several warnings to investors from pouring any funds into crypto.
In regards to the regional bank, it has referred to digital currency price fluctuations and stressed on its effect on the public debate regarding the technology itself. As stated by the bank, the significant rise and decline in price and trading value of digital currencies have eliminated any chance of more discussion regarding the possible benefits that cryptocurrencies can bring to any economy.
Adding to its statement, the impact of crypto and essentially tokenizing blockchain services and products is comparable to the effect of the Internet on the world. Digital tokens and currencies can offer direct and instantaneous transactions, internationally and cost-free as well as deliver KnowYourCustomer-verified identification as well as motivating their direct behavior in the eyes of official authorities and service providers.