[2018-04-14] Kenya’s Central Bank Warns Against Cryptocurrency

[adel hmdt]

As the regulatory debate continues mainly between government agencies and cryptocurrency protagonists, the Central Bank of Kenya (CBK), through its Governor, Patrick Njoroge joins in the campaign towards slowing down the propagation of Bitcoin and cryptocurrencies.

A Recurrent Warning
Njoroge told legislators on Thursday that he had sent a circular to all banks warning them on the dangers of dealing in virtual currencies. According to him while addressing the National Assembly Committee on Finance at Parliament Buildings, the circular cautioned the banks against dealing in virtual currencies or transacting with entities that are engaged in virtual currencies.

This is not the first time that the CBK is getting involved in moves to discourage the country’s citizens from getting involved in what has been popularly described as a risky venture by most regulators. It can be recalled that in December 2015, the consumer protection concerns led CBK to issue a notice warning the public against virtual currencies such as Bitcoin.

These warnings are not peculiar to the CBK alone or to Kenya. In a previous article on CCN, it was reported how the Manager at Nigeria Deposit Insurance Corporation (NDIC) warned citizens of the lack of insurance on any investment in virtual currencies, qualifying them as very risky ventures that are not backed by any physical commodity, such as gold or other precious stones.

In the same trend, just last Wednesday, World Bank Group Senior Vice President Mahmoud Mohieldin said that Blockchain technology may have many good uses in the world, but Bitcoin “could be the biggest bubble in history.” This statement reinforces the recurring question that seeks to address if blockchain technology can be isolated from cryptocurrencies, and how possible it is to adopt the technology without implementing its underlying tokens – cryptocurrencies.

https://www.ccn.com/kenyan-apex-bank-warns-citizens-against-the-use-of-cryptocurrencies/

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[hatshepsut93]

There's a pattern that underdeveloped countries are the most eager to strike against crypto, for example Vietnam, India, Venezuela, Russia. This is because they are the most afraid of people switching to cryptocurrencies when their economies fall, as opposed to wealthy countries that don't see any threat from cryptocurrencies because their people are not going to massively adopt it, so their governments take more balanced position and prefer to wait. I think it would be great if mass adoption of cryptocurrency started from poor countries like Kenya so the whole world could see that it can be used for good, and maybe it will happen despite all the bans, simply because of the decentralized nature of cryptocurrencies.

[kevoh]

It is now a recurring trend, every week one country 's central bank must make an announcement warning citizens against cryptocurrency. Weeks or months later they will announce they are now adopting blockchain and seeing the possibilities of cryptocurrencies.

[bambazamba]

Every government just follows the same sequence of incidents . Firstly , they will find a best way to criticize the crypto currencies , will provide every type of negative publicity to it . Then after this plan tends to fail they will make an another move of "warning" the users and the potential users .
When these chain of incidents does not affect the people's mindset about it , they will ban it completely or will do some shitty stuff of not  banning it but technically blocking all the ways of using it like Indian government did.

[richardsNY]

Weeks or months later they will announce they are now adopting blockchain and seeing the possibilities of cryptocurrencies.

Thus far I haven't seen any central bank actually stating that it acknowledges the power of crypto currencies. The only thing they are stating and caring about is their research and development of permission based blockchains where they are the sole entity being in full control of everything. Imagine a time where even banks will become redundant because of the government taking care of everything with the blockchain as underlying technology. I don't think we're that far away from seeing this become reality. It all fits in the digital time frame we're operating in. In other words, it's not Bitcoin going to tackle banks, but governments themselves....