BoG Warns Against Trading Crypto-Currency

The governor of the Bank of Ghana, Dr Ernest Addison, has cautioned Ghanaians against trading crypto-currencies. 

The crypto-currency market is gaining more popularity in Ghana especially the bitcoin.

The governor, speaking at the 100th Monetary Policy Committee (MPC) conference in Accra highlighted the recent volatility in the digital currency market as a cause for concern.

He opined that, the basic function of currencies is for them to be used effectively as medium of exchange or unit of account.

The recent unpredictability in the crypto market means that you cannot effectively use it to meet any standard functions of money. This forms part of the reasons he is warning the public.

“If you have a currency whose value is so unstable like the recent trends in the crypto market, you really cannot use it effectively to meet any of the standard functions of money” he said.

Emphasizing on the need for the Ghanaian public to refrain from trading in the crypto currency, he stated that it is a high risk investment which is currently not regulated by either the central bank or the Securities and Exchange Commission (SEC).

“The crypto currency, I think we are all aware of what has been going on and have said that this is not a regulated activity in the Bank of Ghana so we warn the public about engaging the crypto currency trade. You have seen the sharp changes in valuation of some of these coins”.

Bank of Ghana to have its Digital Currency

Nonetheless, he noted that the bank of Ghana is not against the use of digital currency as it is one of the first African Central Banks to declare support for digital currency.

Dr Addison further hinted that, the Bank of Ghana is working on its own digital currency to help in online transactions.

“We are looking at the concept of an E-Cedi. So yes, we are quiet advanced in that process. As you know, in this type of things, you have to go at it in phases and the first phase was really on the design of the electronic money and the team that is working on that has gone quiet far in the design phase and we are looking at the implementation phase”.

When this is successful, it will be used in mobile applications and online payment applications that are currently running.

Regulation of the crypto currency market

Earlier in the month, the Securities and Exchange Commission announced that it will hold an engagement series for sector players in the digital currency space to dialogue on how to regulate the digital coin for transactions in Ghana.

The Deputy Director General of SEC, Mr Paul Ababio, addressing the media at the launch of the SEC 10-year Masterplan project stated that there are various dynamics to the crypto currency occurrence.

“There’s the actual block chain technology which can be deployed for other purposes and then the monetization of that technology and how it interacts with the real sector. So, they [SEC] will in the near future spell out the strategy on regulating it” he stated.

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