The Governor of Central Bank of Kenya (CBK), Patrick Njoroge, has expressed fears over the popularity of cryptocurrency and warned that the Bank still does not support transactions due to the risks involved even as such dealings increase.
According TheEastAfrican, Njoroge said Kenyans should avoid to peer-to-peer (P2P) cryptocurrency transaction since it is not regulated.
“There are people who are excited about cryptocurrencies because they see it as a sort of investment that they can win big because prices are going up quickly, so they believe they would see a huge return for their investment.
‘‘But I think that is why we say for every person who wins something, there are hundreds who lose,” said Njoroge.
Speaking in Mombasa during World Consumer Rights Celebration Day 2022 on Tuesday, Njoroge added that financial institutions supporting such transactions risk losing their licences.
“Few years back, we had issued a warning to all Kenyans and even people beyond our borders that we were seeing significant risk from cryptocurrencies not because it was unregulated but because of services it was supporting, majority which were illegal transactions,” said the governor.
Since 2018, Kenya’s central bank has been issuing circulars to local banks warning them against dealing with cryptos or transacting with firms dealing with the currencies.
Njoroge said CBK will only allow such transactions once the business is controlled and additional measures are in place to protect the public.
“We are working with other players and regulators around the world to make sure that space is safe,” he said.
Despite the anti-crypto stance by the regulator, Kenya leads Africa in crypto adoption and is ranked fifth in the world ahead of some of developed countries like the US, China and South Africa, according to the Chainalysis.
Kenya is also ranked top in P2P cryptocurrency transaction volumes, according to the 2021 Global Crypto Adoption Index by Chainalysis.
