African countries are moving to the forefront to regulate crypto as the government of Namibia has become the latest administration to officially sign a law to regulate the Virtual Asset Service Providers operating in the country. The law was approved by Namibia’s National Assembly on July 6, signed by the President on July 14, and inserted into the Gazette of the Republic of Namibia on July 21.
Crypto Laws in Namibia
Last week’s action revised Namibia’s original decision on a ban on cryptocurrency exchanges that was put in place in 2017. Dubbed Namibia Virtual Assets Act 2023, the law is aimed at regulating the operations of crypto exchanges in the country.
However, it is unclear when the new set of laws will come into force. The country’s Ministry of Finance is responsible for determining a date to make them effective.
Under the law, Namibia will “provide licensing and regulation of virtual asset service providers; to designate a Regulatory Authority to regulate and supervise virtual asset service providers and related activities, for purposes of ensuring consumer protection, preventing market abuse and preventing or mitigating the risk of money laundering and financing of terrorism and proliferation activities posed by virtual assets markets; and to provide for incidental matters.”
Namibia’s Virtual Assets Act 2023 is now law, marking the country’s first legislation on how #crypto should be treated. The Act aims to regulate virtual asset service providers, ensure consumer protection, and prevent market abuse. The effective date is yet to be determined by…
— Crypto Insights (@ahmedzein12) July 25, 2023
The country has also set heavy penalties for violators of the upcoming crypto laws. Any crypto provider in the country not complying with the local laws will face a monetary penalty of up to 10 million Namibian dollars (about $670,000) and ten years of imprisonment.
Despite the new crypto laws, the Bank of Namibia does not recognize cryptocurrencies as legal tender. However, it is unclear whether any payment transactions made with cryptocurrencies will be punishable.
Crypto in Africa
Africa is one of the fastest-growing countries in terms of crypto adoption. According to an estimation by Chainalysis, crypto transactions in the continent peaked at $20 billion per month in mid-2021. Kenya, Nigeria, and South Africa led the number of crypto users in the continent.
Meanwhile, many African countries are now adapting progressive crypto regulations. The financial markets regulator in South Africa recently mandated licensing for crypto exchanges operating within its jurisdiction, which will come into effect by the end of 2023.
Other countries, including Botswana, Kenya, Mauritius, and Seychelles, also passed laws around cryptocurrencies. In April 2022, The Central African Republic made Bitcoin a legal tender but repealed the decision within a year. However, Cameroon, Ethiopia, Lesotho, Liberia, the Republic of the Congo, Sierra Leone, Tanzania, and Zimbabwe have a crypto ban in place.
This article was written by Arnab Shome at www.financemagnates.com.
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