Government has reaffirmed its ban on the use of cryptocurrencies in all financial transactions within the country. The announcement was made by Dr. Mohammed Amin Adam, the Minister of State at the Finance Ministry, during a parliamentary session where he addressed questions regarding the government’s stance on cryptocurrencies.
According to Dr. Amin Adam, while the government acknowledges the potential of associated technologies such as blockchain and distributed innovations, it is currently exploring the development of a regulatory framework to govern their use. Until such a framework is established, the government emphasizes its directive, which has been communicated through various notices, including one issued on March 9, 2022.
The Ban on Cryptocurrency
The directive explicitly prohibits all financial institutions licensed by the Bank of Ghana from facilitating cryptocurrency transactions through their platforms or agents’ outlets. This ban extends to both local and international cryptocurrency exchanges operating within the country’s borders.
This recent announcement builds upon earlier cautionary directives issued by the Central Bank in April 2022. These directives were aimed at guiding banks and other financial entities to exercise caution when dealing with cryptocurrency trade and other unregulated investment schemes. The government’s objective in implementing these measures is to safeguard the digital space and protect Ghanaian citizens from potential risks associated with cryptocurrencies.
Cryptocurrencies, such as Bitcoin and Ethereum, have gained significant popularity worldwide in recent years. While proponents argue that cryptocurrencies offer numerous benefits, including decentralization, increased financial inclusion, and potential for economic growth, concerns over their volatility, lack of regulation, and potential for illicit activities have prompted many governments to adopt a cautious approach.
Government aims to mitigate potential risks associated with Digital Assets
By reiterating the ban on cryptocurrency transactions, the Ghanaian government aims to mitigate potential risks associated with these digital assets and maintain stability in the country’s financial sector. The government is actively working on developing a comprehensive regulatory framework to address the challenges and opportunities posed by cryptocurrencies while fostering innovation in associated technologies.
It is worth noting that the ban on cryptocurrency transactions does not extend to the exploration and utilization of blockchain technology and other distributed innovations. The government recognizes the value and potential of these technologies and will continue to encourage their development within a controlled environment.
As the government proceeds with the development of a regulatory framework, stakeholders in the cryptocurrency industry, including businesses and investors, are encouraged to comply with the directives and engage in discussions with relevant authorities to shape the future of cryptocurrencies in Ghana.
In conclusion, the Ghanaian government has restated its ban on cryptocurrency transactions, directing all financial institutions licensed by the Bank of Ghana to refrain from facilitating such transactions. The government’s objective is to protect citizens from potential risks associated with cryptocurrencies while exploring the development of a regulatory framework to govern their use. While blockchain and other distributed innovations remain permissible, the government emphasizes the importance of adherence to the directives to ensure a secure and regulated digital space in Ghana.