6 African Countries That Have Completely Banned The Use Of Cryptocurrency

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By Tonny Ingutia

Africa has the fastest growing cryptocurrency market while also having the smallest. This is due to the continent’s sporadic use of digital currencies. For example, of the 46 Sub-Saharan African countries, Kenya, Nigeria, and South Africa account for a sizeable portion of the region’s total crypto transactions.

Aside from the sporadic use of cryptocurrency, African governments share a common fear of using a currency with few to no regulations. Given the recent collapse of the world’s third largest crypto exchange, FTX, and the subsequent drop in the prices of Bitcoin, Ethereum, and other major crypto assets, this is a very valid fear.

As a result, the use of cryptocurrency remains a major source of contention in many markets throughout the region. The recent FTX crash has reignited the debate over government regulations on cryptocurrency, and the general public has grown wary of exchanging their traditional currency for a virtual one.

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However, in Africa, this discussion is unlikely to have much impact, at least in the coming years, because authorities in the region simply have a general mistrust of blockchain technology. This was evident during the #endsars period in Nigeria, where a conflict of interest arose.

During the #endsars movement, the Nigerian government banned the use of cryptocurrency, despite widespread public outrage. If this is any indication, it demonstrates that the people of Africa are ready to embrace the use of cryptocurrency and are willing to accept the risk, which is similar to the risk present in the stock market. Governments, however, are not.

“Policymakers are 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,” according to a report by the International Monetary Fund.

The IMF noted in the same report, titled the October 2022 Regional Economic Outlook for Sub-Saharan Africa, that two-thirds of Sub-Saharan African countries have implemented some form of cryptocurrency restrictions, and six countries have banned cryptocurrency entirely.

Countries that have placed some restrictions on the use of cryptocurrency were classified as having an implicit ban by the IMF, while those that have completely banned the use of cryptocurrency were classified as having an explicit ban.

Below are six of these countries that have explicitly banned the use of cryptocurrency;

*Sierra Leone

*Cameroon

*Ethiopia

*Lesotho 

*Tanzania

*The Republic of Congo

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