As regulatory bodies across the globe continue to step-up measures to tackle the associated risks with crypto investing and protect the investor’s interest, the Central Bank of Canada has recently issued warnings to all banks.
As reported by the local news outlet , the Central Bank of Kenya (CBK) has issued warnings to other banks to refrain from dealing with digital currencies or any other crypto-related transactions.
While speaking in front of the National Assembly Committee on Finance, Patrick Njoroge Governor of CBK said that the latest warning comes in accordance with other regulators, globally. The governor said:
“The actions of CBK are consistent with those taken by other regulators globally, most of whom have taken a cautious approach towards crypto-currencies.”
Njoroge also further talked about the use of cryptocurrencies for illicit activities and its speculative behaviour. He also said that the decentralized and unregulated behaviour of cryptocurrencies makes it more exploitable to be used for money laundering and similar activities. He said:
“There are risks associated with cryptocurrency particularly on consumer protection, fraud, hacking and loss of data and they are prone to be used as pyramid scheme.”
According to another local news publication Blockchain technology but also mentioned that its use for digital currencies can be detrimental to the overall financial system., Njoroge has one the other hand, supported the underpinning
Although this is not for the first time that CBK has been issuing warnings in order to discourage its citizens from getting involved in digital currencies. Back in 2015, the consumer protection concerns led by the Central Bank of Kenya issued similar directives issuing warnings against Bitcoin.
Just a few days back, India’s Central Bank issued similar directives to its other local to decouple its operations from crypto exchanges.