Uganda’s central bank tells authorized entities to stop facilitating cryptocurrency cryptocurrencies are digital currencies that use cryptographic technologies to secure their operation. transactions.
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The Central Bank of Uganda has warned licensed entities and the public against facilitating cryptocurrency related transactions as well as the practice of converting cryptocurrencies into fiat fiat currency is “legal tender” backed by a central government, such as the Federal Reserve, and with its own banking system, such as fractional reserve banking. It can take the form of physical cash, or it can be represented electronically, such as with bank credit. money and vice versa. The central bank warned that it will not hesitate to act against entities that violate the country’s laws.
The agency recently issued a statement reminding the public that no company is licensed to offer or facilitate services related to cryptocurrencies . The statement warned the authorized entities to stop the transactions.
According to several media outlets, the warning came from Andrew Kawere, director of payments for the Bank of Uganda (BOU) . This comes less than three years after the country’s finance minister, Matia Kasaija, made similar comments. In the report, Kawere is quoted reiterating the central bank’s position. He said:
“Bank of Uganda has noticed press reports and advertisements warning the public that they can convert cryptocurrencies into mobile money and vice versa. We are also aware that such conversion cannot happen without the involvement of payment service providers and/or payment system operators. This is to inform that the Bank of Uganda has not authorized any institution to sell cryptocurrencies or to facilitate the exchange businesses that allow customers to trade cryptocurrencies for fiat money or other cryptocurrencies. of cryptocurrency. s. This is in line with the official government position communicated by the Ministry of Finance, Planning and Economic Development in October 2019.”
However, in the latest central bank circular, Kawere warned licensed entities that violate the provisions of the Uganda National Payment System Act 2020, that the central bank will not hesitate to “ invoke its powers under Section 13 (l) (b) and (f) of the NPS Act, 2020 for any licensee who violates the above directive.”
Ugandeses usan cripto
Many Ugandans, especially professionals looking for extra income and the unemployed, have invested in cryptocurrencies in a bid to make money.
The Ministry of Finance said that, as such, unlike other owners of financial assets who are protected by government regulation, cryptocurrency holders in Uganda do not enjoy any consumer protection in the event that they lose the value assigned to their cryptocurrency holdings, or in the event that the organization facilitating the use, holding or trading of cryptocurrencies is unable, for any reason, to provide the services or value it promised.
In the circular, the government warned that most cryptocurrencies are not backed by government assets or collateral collateral is any asset that a lender accepts as a form of security to ensure that the borrower repays a loan. and, therefore, holders of these cryptocurrencies are fully exposed to the risk of loss or decline in value, as issuers are not obliged to exchange them for legal tender or other value.
“Cryptocurrencies tend to change change — a concept relevant to cryptocurrencies that use the UTXO model — is the number of coins sent back to a user after they use their unspent outputs to initiate a transaction. in value rapidly over time. While holders of cryptocurrencies can profit when their value rises, they will be exposed to losses when their value falls. The nature of cryptocurrencies makes them attractive for use in criminal activities. transactions such as money laundering, the sale of prohibited goods and services, and fraudulent enterprises such as ponzi and pyramid schemes” The Ministry of Finance warned.
Media account an account is essentially a whose purpose is to track the financial activities of a specific asset/ AllAfrica that the statement comes on the heels of a report that about 1,000 Ugandans lost over 3 billion Ugandan shillings (over USD $840,000) in online digital digital technologies are these electronic tools that have the ability to generate, store or even process data. transactions between 2018 and 2020 to a charlatan cryptocurrency trader.
It is worth noting that Uganda has long a situation where you buy a cryptocurrency with the expectation of selling it at a higher price for profit later. been talking about the issue of cryptocurrencies. In 2016 there was already talk of the possibility of crypto regulation . In 2018, Binance announced that would open an exchange in that African country .
Sources: AllAfrica , Bitcoin.com , archivo
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