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The Central Bank of Ethiopia considers Bitcoin transactions illegal
The Central Bank of Ethiopia considers Bitcoin transactions illegal
Bitcoin

The Central Bank of Ethiopia considers Bitcoin transactions illegal

By Vincenzo Cacioppoli - 8 Jun 2022

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The Central Bank of Ethiopia has issued a public statement warning its citizens that Bitcoin transactions are illegal in the country.

Ethiopia speaks out against Bitcoin exchanges

bitcoin transactions
According to the Ethiopian Central Bank, trading Bitcoin in the country is illegal

In recent days, the Ethiopian Central Bank reiterated in a public statement that Bitcoin transactions are illegal, while also warning of severe penalties for offenders.  

In a note, the NBE stated that:

“Ethiopia’s national currency is the Ethiopian Birr, with any financial transaction in Ethiopia to be paid in Birrs, according to the law”.

The announcement was picked up by all local media, while the central authority specified that the use of Bitcoin was considered illegal in commercial transactions. The monetary authority also reiterated that those using cryptocurrencies are only doing so for:

“Informal financial transactions and money laundering schemes”.

Reactions from the crypto community were not long in coming, and comments began on social media about a statement that sounds highly punitive towards digital currencies.

In the same statement, the Central Bank nonetheless acknowledges the growth in the use of BTC in the East African country, but reiterates that it has never granted permission for citizens to use the currency for transactions and payments, warning of negative consequences for those who do. 

The spread of cryptocurrencies within Africa

The adoption of cryptocurrencies has spread widely in the country as well as across Africa, where Bitcoin transactions last year reportedly reached around $106 billion, up 1200% from the year before.

In Ethiopia, the inflation rate is at 36% and it is now clear that Bitcoin is used more in countries with skyrocketing inflation rates, such as almost all African countries.

In April 2021, the Ethiopian government pioneered an initiative with Input-Output Global, the company responsible for developing Cardano’s blockchain, to create digital and decentralized IDs for students and teachers.

The goal of this project would be to implement a digital payments and transactions system to be expanded across the African continent. 

Now this declaration by the Ethiopian Central Bank places the state, whose wealth of raw materials would also make it an ideal place for Bitcoin mining, among the 42 countries in the world that have declared the use of cryptocurrencies illegal. While a few weeks ago the Central African Republic, one of the world’s poorest countries, legalized the use of Bitcoin in the country

Vincenzo Cacioppoli

Vincenzo was born in Genova but lived most of his life in Milan. He has a degree in political science. He is a journalist, blogger, writer, and marketing and digital advertising expert. After a long experience in traditional marketing, he started working with the web and digital advertising in 2011, creating a company called Le enfants. Passionate about the web and innovation, in 2018 he started exploring the topics related to blockchain technology and cryptocurrencies. Independent cryptocurrency trader since March 2018, he now collaborates with companies in the sector as a content marketing specialist. In his blog. mediateccando.blogspot.com, he has long been primarily focused on blockchain, which he considers to be the greatest technological innovation after the Internet. His first book about blockchain and fintech is scheduled for release in November.

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