The Kenyan Parliament has set a two-week deadline for the Minister of Finance, during which he will determine the fate of Bitcoin and other cryptocurrencies, especially whether they can obtain legal tender status in a country with a population of 48 million. Prior to this, the Kenyan central bank (CBK) also issued a warning in April.
The Finance and National Planning Committee of Kenya asked agency officials to explain the popularity of cryptocurrency transactions in Kenya, and why the Ministry of Finance and the Kenyan central bank allowed people to trade and invest in these unregulated cryptocurrencies instead of A license process is required or a profit income tax is paid. At present, government regulators around the world have begun to notice the surge in cryptocurrency transactions, and the Kenyan government’s move is timely. Committee Chairman Joseph Limo unequivocally stated this situation:
“We were surprised to find that even the central bank did not know which Bitcoin ATM machine there was at Kenyatta University and that there was a hotel operating a bitcoin transaction in Nyeri. It is even more serious in Kenya because people are trading billions of dollars in the virtual currency market, and the Treasury has not licensed and taxed virtual currency like M-Pesa and bank transactions."
The Kenyan central bank did issue a notice to the public in December 2015 to warn the public about the use of electronic money. The notice stated that “virtual currencies such as bitcoin are not legal tender in Kenya, so if the platform for trading or storing cryptocurrences goes bankrupt or goes bankrupt The user does not have any protection." The notice also lists other risks associated with cryptocurrencies.
On Tuesday, Henry Rotich, head of macroeconomics at the Kenyan Ministry of Finance, criticized the volatility of cryptocurrencies. He pointed out that the sharp depreciation of Bitcoin in the past few months is a good example of cryptocurrency. Whether it can become the legal currency of Kenya may not be a good sign.
Mr. Rodage told the parliament that, like any other developing technology, cryptocurrencies are still under government scrutiny, and it is not clear whether they are allowed to develop or be banned and regulated in the country. He pointed out that one of the main problems with cryptocurrency technology is that it could become a tool for money laundering. He said:
“I don’t know if anyone in the country is operating an exchange. But I will try to find out if there is an exchange in the country. The problem of cryptocurrency is gradually evolving. As the main body of state administration, we must have our own position. Supporting innovation and stifling innovation There must be a delicate balance between the two."
India has also recently experienced the same path as Kenya, but in the end India has determined that Bitcoin and other cryptocurrencies are not legal tender.