Ethiopia’s central bank today issued a statement calling Bitcoin “illegal”, prohibiting the use of any other currency except Birr for all transactions.
Unlike its western neighbour, the Central African Republic, which has adopted bitcoin as its legal tender, raising concerns within the International Monetary Fund, the National Bank of Ethiopia (NBE) does not recognize virtual currency, she said. said Monday in a statement.
“Ethiopia’s national currency is the Ethiopian birr, with any financial transaction in Ethiopia having to be paid in birr as per law,” the bank said in a statement to state-affiliated media outlet Fana Broadcasting Corporate.
Although the bank acknowledges the growth in bitcoin usage in the East African country, it is adamant that it has never allowed citizens to use the currency for transactions and payments. , warning of the negative consequences for those who do so. He took this stance as he believes virtual currency is used to conduct informal financial activities and launder money in the country.
A Twitter user claiming to be from the financial services industry in Ethiopia, tweeted“Why is this happening in Ethiopia, it is supposed to approve cryptocurrencies and legit digital currencies to be fully functional in Ethiopia, not all users use it for corruption,” tagging Abiy Ahmed Ali, Prime Minister of the Federal Republic of Ethiopia.
The announcement comes as Octagon Networks, a cybersecurity company offering services from the country’s capital, Addis Ababa, recently converted all of its liquid assets into bitcoins.
Cardano hopes to pioneer payment network in Ethiopia
In April 2021, the Ethiopian government launched an initiative with Input-Output Global, the company responsible for the Cardano blockchain, to create decentralized digital IDs for students and teachers. Three weeks ago, IOG announced that it was ready for the implementation phase which would initially see 1-2 million students and teachers benefit en route to the goal of 5 million students and 750,000 teachers.
Cardano’s end goal is to build a payment network in Ethiopia before expanding to the rest of the African continent.
Varied approaches to digital assets in Africa
The African approach to digital currencies has been fragmented. In April this year, the Central African Republic, one of the poorest countries in the world, made bitcoin legal tender. Cameroon, the Democratic Republic of Congo and the Republic of Congo started talks with the TON Foundation, also in April this year, to launch localized stablecoins unrelated to central banks. “We’re not trying to replace a national currency, and we’re not aiming to create a CBDC, which is obviously run by a central bank,” a source told Forbes at the time. Nigeria introduced its own central bank digital currency, eNaira, last year.
The NBE has encouraged citizens to refrain from using cryptocurrencies and report any illegal transactions to Ethiopian authorities.
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