Namibia approves bill to regulate cryptocurrencies

Regulatory body to be established to supervise and issue licenses to virtual asset service providers

Namibia has joined the growing list of African nations embracing cryptocurrencies and digital assets with the approval of a new bill by the Namibian National Assembly. The bill passed on June 22, aims to regulate digital assets, cryptocurrencies, and the providers of digital asset services within the country, signaling a positive outlook for the industry.

The primary goal of the legislation is to establish a framework for licensing and regulating virtual asset service providers. It also seeks to designate a regulatory authority responsible for overseeing these providers and their activities.

The key objectives include safeguarding consumer interests, preventing market abuse, and mitigating the risks associated with money laundering, terrorist financing, and proliferation activities linked to virtual asset markets. The law also covers various ancillary matters related to these objectives.

The bill is currently awaiting official publication before it can be put into effect. Iipumbu Shiimi, Namibia's minister of finance and public enterprises, has mentioned the establishment of a regulatory body that will supervise and issue licenses to virtual asset service providers in the country.

Non-compliant providers could face severe penalties, including fines of up to $671,572  and a possible 10-year prison sentence. However, it is important to note that the Bank of Namibia maintains its stance that cryptocurrencies do not hold legal tender status in the country.

Kazembire Zemburuka, the Bank of Namibia's director of strategic communications and international relations, reaffirmed the bank's position, stating that once the associated risks of virtual assets are better managed, the bank will assess and make a decision regarding their acceptance within the financial system.

Back in 2017, the Bank of Namibia expressed strong opposition to the use of cryptocurrencies as a method of payment for goods and services, stating that virtual currency exchanges had no place in the country under existing laws. 

With the passage of this bill, Namibia joins other African nations in creating a regulatory framework for cryptocurrencies and virtual assets, aiming to strike a balance between facilitating innovation and ensuring consumer protection. 

Nigeria introduced crypto regulations in September 2022, South Africa approved cryptocurrencies as a financial product in October 2022, while Kenya recognized cryptocurrencies as securities in November 2022. Last year Ghana was also set to launch its own Blockchain (CBDC)-powered currency.

The future implementation of this legislation will likely play a crucial role in shaping the cryptocurrency landscape in Namibia and potentially attracting more investors and businesses to the country's growing digital asset market.

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Written by Silvia Pavlof

Silvia has explored various forms of writing, ranging from content creation for social media to crafting movie scripts. Drawing on her experience as a journalist specializing in the gambling sector, she is currently investigating the impact of cryptocurrencies and blockchain on traditional gambling and iGaming.

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