Governor of the Central Bank of Kenya, Patrick NgorogAnd the He admitted that he was under external pressure from crypto enthusiasts to convert the country’s reserves into Bitcoin (BTC).
in Meeting With lawmakers on September 19Ngorog described the plan as “crazy,” adding that it would be risky to convert assets into bitcoin given the volatile nature of the digital commodity.
In addition, he indicated that lawmakers may come under pressure to influence the legislative process in favor of cryptocurrency adoption.
Pressure to pay cryptocurrency
Interestingly, the governor said he would be willing to spend time in prison if the nation adopts bitcoin during his administration. He said ,
“I know you are under a lot of pressure from some of these people pushing these things [cryptocurrencies] Because it’s good for them. I can assure you that I have plenty of people who would push me to put our reserves into Bitcoin. <…> I was going to lose my mind that kind of crazy.”
Njorog added that a nation can only decide to adopt cryptocurrency if it presents a solution to a specific problem. To get away from the “hype” surrounding digital assets, he called for a review of the bitcoin market.
What issue in our economy are they addressing, he asked? He further stated,
“The answer is no, it is not a superior means, for example, for payments or other activities. Whatever the issues are, is it better? The answer is no, its security is not superior to the security of your bank account. Examine it properly to determine whether or not it will solve a particular problem.”
The need for regulations
Notably, the Central Bank of Kenya has already warned the population against using cryptocurrencies, citing the risks associated with doing so. To control the industry, there aren’t any extensive regulations, though.
In this case, the organization mostly sent circulars to regional banks advising them to be careful when dealing with cryptocurrencies or companies that deal in digital assets.
A recent study showed that four million Kenyan investors lost money as a result of the continued selling of digital assets in the market, drawing attention to the seriousness of the threats.
Despite this, Kenya thrives on crypto activities. While Nigeria is Paxful’s largest market globally, Kenya is currently the second largest in Africa and the fifth largest globally.
Kenya saw P2P volumes in excess of $200 million in 2021 and over $125 million in the first half of 2022. “We expect a 25% increase in trade volume in Kenya for 2022,” Paxfull continued.
Paxful stated that in response to the significant increase observed in Ghana and Kenya,
“There are more and more African users remitting money over the years – the total remittance user base (users who trade in multiple currencies) on Paxful grew by almost 140% in Kenya and over 115% in Ghana in 2021. In 2021, it experienced Ghana Annual growth of 95% in trade volume.”