Ghana establishes a regulatory framework to shift from hostility toward crypto assets and potentially contribute to mass adoption.
The Bank of Ghana (BoG), the country’s sovereign bank, plans to give the West African country the green light to enter the crypto space. According to a recent report from African Law & Business, the Ghanaian government will launch a regulatory guideline to serve as guardrails for crypto adoption in the country.
The latest news comes after extensive research of the crypto ecosystem revealed crypto asset use cases in the Ghanaian economy. For example, employing cryptocurrency in the remittance of cross-border payments has been endorsed as faster and cheaper.
Ghana’s Previous Crypto Hostility
It is worthy of note that in the past, the Bank of Ghana has issued clear warnings to Ghanaians that users are at their own risk as crypto assets are not recognized as legal tender. Moreover, cryptocurrencies are not regulated by any Ghanaian law. Therefore, they could be a force for funding terrorism and users’ vulnerability.
However, the government has now leaned towards a crypto-friendly outlook. Regarding the driving force behind the latest shift, the regulator stated:
“The digital asset landscape in Ghana is evolving, with increasing interest and adoption of crypto assets and blockchain technology, supported by a growing number of exchanges and initiatives in the country’s financial ecosystem. Although these transactions have relatively insignificant volumes compared to the broader digital payments, the dynamic growth of digital assets calls for regulatory clarity to ensure adequate financial stability and consumer protection.”
While the BoG stated that the new regulatory guidelines would allow citizens to use crypto assets like BTC and ETH, it clearly stated that unless the latest guideline goes into effect, financial service providers are restricted from processing cryptocurrency transactions.
In addition, parts of the guidelines mandate that virtual assets service providers conduct due diligence protocols, implement measures to prevent financial crime, and report suspicious transactions.
Like Ghana, other African countries that used to be unfriendly with the crypto space have turned around and embraced it. For instance, the Nigeria Securities Exchange Commission (SEC) recently approved Quidax and Busha to resume legal operation as regulated crypto exchanges in the country.