The state of Bitcoin in Kenya has been one of murky waters. The Central Bank of Kenya (CBK) has issued warnings against those investing in Bitcoin over the years saying that investors are not protected. Companies like Safaricom have also openly fought against Bitcoin trade in the country by cutting ties with BitPesa and Lipisha which it claimed were going against Safaricom’s anti-money laundering policy since Bitcoin is not regulated by the CBK.
Over the past few months, Bitcoin’s value has been soaring, hitting an all time high, day after day. Well, Kenyans didn’t want to be left behind and there have been reports of Kenyan Bitcoin investors making upto Ksh 100,000 daily and this created a gold rush leading CBK’s Governor, Dr Patrick Njoroge to issue another warning late last year.
“We warned everybody that this was a risky venture and and the consumer is not protected. It could very well be a Ponzi scheme of a kind, I think you have seen how the prices have gone up and down in various places,” said Dr Njoroge in an interview with The Standard. According to CBK, in case Bitcoin crushes, the effects could lead to economic instability, “Our point is that there is a risk and it is important that everybody knows that those risks can come back to haunt us and could have financial stability concerns,” he added.
Pyramid or no pyramid, we need to at least take that risk – Joe Mucheru
CBK has made it clear that they are not against the technology behind Bitcoin, blockchain, what they are not comfortable with is Bitcoin itself. “There may be a future for blockchain. We are working with our peers around the world on things that could lead to using this technology in particular ways,” concluded Dr Njoroge.
In an interview with Citizen TV, ICT Cabinet Secretary, Joe Mucheru showed his support for Bitcoin and the underlying technology blockchain. “As we look at the future, we’re not left behind in certain areas such as the blockchain technologies, we want to be part of that growth. We missed out on the internet, blockchain we must,” said the Cabinet Secretary.
Mr Mucheru went ahead to say that the CBK has a role to play concerning cryptocurrencies in the country. “Central Bank have a role and responsibility to play and I don’t think we are going to fight about it. Whether we want to be part of it or not, it’s not our choice. The world is already moving in that direction. Pyramid or no pyramid, we need to at least take that risk.”
Joe Mucheru also said that Bitcoin is a technology that can’t be regulated, however, the companies that are involved in it can be regulated. Mr Mucheru’s stand puts him and the CBK governor at opposing ends, at least they can both agree that blockchain is important but the issue still remains, will Bitcoin be regulated in Kenya? It will be interesting how this Bitcoin issue plays out this year.