November 27, 2018 7:17 PM
The East African country of Uganda is set to regulate cryptocurrencies to prevent scams and protect investors. ETHNews spoke with the chairman of the Blockchain Association of Uganda to learn more about the local cryptocurrency ecosystem and what may have led to this development.
Reports indicated Uganda's state finance minister, David Bahati, has replies to parliamentary concerns over the agency as cryptocurrency dealers. He spoke of government plans that will apply to both cryptocurrencies and pyramid schemes, the latter of which are also prevalent in the country: "In October, Cabinet approved the National Payment System Bill. transactions. "
Members of the Ugandan Parliament have provided a framework of supervision or legislation, allowing the illegitimate schemes to take hold. One MP, Mathias Mpuuga, spoke of Ripcoin, Namecoin, and Telex Free, and called unregulated actors "a potential bomb."
Though the Central Bank of Uganda has been warned to be cautious, the new bill is the first formal step to the legal framework for cryptocurrency operators.
Kwame Rugunda, chairman of the Blockchain Association of Uganda, told ETHNews that Ponzi schemes, often working as multi-level marketing or pyramid schemes, have been "a problem for many years" in the country, adding: " crypto businesses and the Central Bank has warned society about them. "
Rugunda also provided examples of common scams in the country, calling them to "menace."
"The most common of them is called" One Coin promoted by the One Life Network, others include "D9", "DRC Gold coin", "Telex Free", "Onyx Coin", "Billion coin", etc. They are a distort the proper understanding and great opportunity that crypto. "
He explained that he would be repetitively fleeced by these Ponzi schemes, and there are numerous court cases. "
Cryptocurrency adoption in Africa, outside of South Africa, has been relatively slow but is growing. Binance recently launched Binance Uganda, a local fiat-to-cryptocurrency exchange where users can buy Bitcoin and Ethereum with the Ugandan shilling. Binance said it had two goals for this: firstly, to increase economic activity in Uganda and wider Africa, and secondly, to provide education, as well as a secure way to buy cryptocurrencies. Local interest in Binance Uganda has been strong, Rugunda confirmed.
Cryptocurrency regulation, when asked if the binance could have impacted the move
In Uganda, they have engaged the regulatory authority in Uganda, and they have engaged the regulatory authority in Uganda. in place its policies and regulatory frameworks. "
If you are not interested in the National Payment System, you can not find it in the Netherlands. directly following Uganda's lead.
Although cryptocurrencies appear to have been adopted by bad actors within Uganda, the new regulations may allow more legitimate cryptocurrency to be used in the country, where blockchain adoption is garnering attention.
The Blockchain Association of Uganda organized the largest blockchain conference in Africa in May 2018, attended by 800 delegates from 23 countries. In response, with the support of Ugandan President Yoweri Museveni, a national task force is now investigating blockchain and other fourth industrial revolution technologies.
In addition, Rugunda told ETHNews the Central Bank of Uganda has created a blockchain working group and regulatory sandboxes are now emerging to encourage blockchain innovation.
Melanie Kramer is a freelance FinTech, blockchain, and cryptocurrency writer based between France and Canada. Melanie has studied, and retains an interest in, global politics, business, and economics.
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