The National Bank of Rwanda (which is the Central Bank of Rwanda) has agreed with the Capital Markets Authority of Rwanda (CMA Rwanda) on cryptocurrency regulations, said Governor John Rwangomba.
According to local reports, the Governor revealed this as part of a response to a question from a legislator on the use of Bitcoin in the East African nation.
“They are currencies that people venture into and the lucky ones make profit from them and become millionaires in a short time, and the unlucky ones even lose what they had,” Rwangombwa said about cryptocurrencies generally.
“What we are doing, in partnership with the Capital Markets Authority [CMA Rwanda], based on what is being done at the international level, is to put in place regulations governing what we call virtual assets which can be traded in our country,” he said.
In 2023, the apex bank issued a public warning to residents not to be involved in cryptocurrencies citing several risks including the volatility of the assets, an issue which the Governor spoke about in his response to the legislator.
“[Bitcoin] is known to go up sharply, and crash. So, because there are no laws that effectively govern their functioning, there are many speculations involved,” he remarked.
The Central Bank of Rwanda Issues Public Notice Warning Against Cryptocurrencies Including Stablecoins
The bank said market value of crypto-assets including stablecoins declined from $3 trillion in 2021 to 1 trillion in mid-2022.https://t.co/9v7tDoCOR6 @CentralBankRw pic.twitter.com/mAtMAIIr5O
— BitKE (@BitcoinKE) February 24, 2023
So far, he said, Rwandans are advised to avoid dealing in cryptocurrencies due to risks of fraud and lack of regulation but is resigned to the staying power of the digital assets.
“We cannot get rid of [cryptocurrencies],” Rwangombwa told lawmakers.
“So, it was necessary that we set up laws and regulations governing their functioning in the country.”
On a similar note, since 2022, the bank has conducted a feasibility study for CBDC implementation and launched a public consultation seeking views from the public about a Central Bank Digital Currency (CBDC) in May 2024.
CBDC | National Bank of Rwanda (BNR) Seeks Public Views on a CBDC Ahead of Possible Proof-of-Concept
The Proof-of-Concept phase will allow the National Bank of Rwanda to experiment with a CBDC within a controlled, limited setting, aiming to gain understanding of the technology… pic.twitter.com/bGdwpC27ok
— BitKE (@BitcoinKE) May 7, 2024
The consultation period was scheduled to end in June 2024 upon which the bank was to embark on a proof-of-concept to validate the use cases identified during the research phase and demonstrate if the risks identified can be mitigated.
According to a deputy governor, the bank could introduce a national Central Bank Digital Currency (CBDC) within the next two years.
[TECH] CBDC | The National Bank of Rwanda Outlines Plans for a Central Bank Digital Currency in 2 Years: Rwanda is aiming to launch its own national Central Bank Digital Currency (CBDC) within the next two y.. https://t.co/1jB8Yhu0WG via @BitcoinKE
— Top Kenyan Blogs (@Blogs_Kenya) June 11, 2024
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