Cryptocurrencies like Bitcoin have become popular and valuable in the last decade and have become an alternate mode of payment. However, governments are still weary about their use and we see this coming up from time to time.
In Uganda, the government is warning citizens from using cryptocurrencies. According to the Independent, Finance Minister, Matia Kasaija issued a strong warning to Ugandans who are investing in cryptocurrencies where he said the government does not recognize them.
Apparently he told reporters that the government will not be held responsible in case anyone loses money to organizations selling cryptocurrencies. The minister said as the Central Bank, they don’t believe cryptocurrencies meet all the characteristics of genuine currency.
Mr Kasaija said that these currencies are exposed to risks that includes fraud and they are not backed by any assets, which makes it a high risk venture.
“Let me state clearly that the online cryptocurrency businesses are not regulated at the moment and therefore carry a significant risk of loss of savings, with no recourse to protection or insurance by the government,” Bank of Uganda’s Deputy Governor, Dr Louis Kasekende said.
There are several types of cryptocurrencies out there with the most famous one being Bitcoin. Bitcoin in particular became quite famous and its value skyrocketed to a high of $19,000 per Bitcoin in December 2017. This wild rush in value got people interested in the cryptocurrency market. Governments all over the world are yet to catch up to the cryptocurrency and blockchain wave and such moves by the Ugandan market are the typical reactions you see.