[kictanet] Public Notice by CBK on Virtual Currencies

[Josiah Mugambi]

CBK has taken a stand:

https://www.centralbank.go.ke/index.php/news/464-public-on-virtual-currencies-such-as-bitcoin

Extract:

++++

The attention of the Central Bank of Kenya (CBK) has been drawn to media
reports
on the use, holding and trading of virtual currencies such as Bitcoin in
Kenya.
Bitcoin is a form of un-regulated digital currency that is not issued or
guaranteed by
any government or central bank. Domestic and international money transfer
services in Kenya are regulated by the Central Bank of Kenya Act and other
legislation. In this regard, no entity is currently licensed to offer money
remittance
services and products in Kenya using virtual currency such as Bitcoin.

This is to inform the public that virtual currencies such as Bitcoin are
not legal
tender in Kenya and therefore no protection exists in the event that the
platform that
exchanges or holds the virtual currency fails or goes out of business. Some
of the
risks associated with buying, holding or trading virtual currencies include
the
following:
 Transactions in virtual currencies such as bitcoin are largely
untraceable and
anonymous making them susceptible to abuse by criminals in money laundering
and financing of terrorism.
 Virtual currencies are traded in exchange platforms that tend to be
unregulated
all over the world. Consumers may therefore lose their money without having
any legal redress in the event these exchanges collapse or close business.
 There is no underlying or backing of assets and the value of virtual
currencies is
speculative in nature. This may result in high volatility in value of
virtual
currencies thus exposing users to potential losses.

CBK reiterates that Bitcoin and similar products are not legal tender nor
are they
regulated in Kenya. The public should therefore desist from transacting in
Bitcoin
and similar products.
++++


-- 
Josiah Mugambi
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