Central Bank Of Kenya Warns Banks Against Dealing In Crypto

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The Central Bank of Kenya (CBK) has issued a circular to all banks in the country, warning them against dealing with cryptocurrencies or engaging in transactions with crypto-related entities, local news outlet Standard Digital reports today, April 13.

CBK Governor Patrick Njoroge mentioned the circular when speaking in front of the National Assembly Committee on Finance, stating that CBK’s warning fell in line with other regulators globally, according to The Star:

“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 cited crypto’s prevalence to be used for illegal activities, its anonymous nature, and its lack of centralized control as impetus for the ban:

“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 The Star, Njoroge expressed support for innovation in technology, but noted that some of the new technologies could be dangerous for the financial sector.

The CBK had warned the public against Bitcoin (BTC) and other cryptocurrencies back in December 2015, citing its lack of regulation and recognition as legal tender.

India’s central bank announced that they would be ending all dealings with crypto-related entities last week, and China’s central bank warned against the dangers of Initial Coin Offerings (ICO) in September of last year.

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