On May 21 during the MindSpeak forum, host Aly Khan Satchu had a discussion with the Central Bank of Kenya (CBK) Governor Patrick Njoroge. The central bank executive spoke about Bitcoin and blockchain technology and told the host Kenya is in no rush to adopt virtual currencies. Njoroge’s reasoning behind this statement is because he believes the country doesn’t quite have the technical means to handle cryptocurrencies at the moment.
Governor Patrick Njoroge says Kenya and its officials are not prepared to work with virtual currencies like Bitcoin at the moment. The CBK has yet to come up with regulatory policies and discussions of blockchain technology was a point of contention for the central bank. In 2015 the CBK issued a statement about Bitcoin and stressed caution to Kenyan citizens using the cryptocurrency. The public notice was issued after the recent argument and court proceeding between Safaricom and Bitpesa. The statement made by the CBK noted that the bank was the sole regulator of all currencies both foreign and domestic within the country. CBK said:
“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,”
The central bank’s Governor again approved this message during the MindSpeak forum when questioned by an audience member about Bitcoin. The contention he and his colleagues have is that the cryptocurrency is not regulated by the central bank which can lead to illegal activities, terrorist funding, and money laundering. Alongside the typical issues central bankers have with Bitcoin, Njoroge says Kenya is just not ready to handle virtual currency on a technological level. Meaning the country’s system is not technically advanced enough yet to take on the virtual currency at the moment. The Kenyan economy is growing as Njoroge explains, “our economy is resilient even as the global economy is expected to grow at a slow rate of 3.2 per cent,” but needs more time to discuss regulatory policies concerning the cryptocurrency. However many Kenyans disagree with the Governor’s attitude such as columnist Michael Kimani, who writes:
“The thing with Bitcoin, cryptocurrencies and the blockchain, is they radically new and potentially highly disruptive. For us as a people and country, it offers a great opportunity to get in early and shape the development of this technology. We can draw lessons from Kenya’s history, when just 7 years ago, banks strongly opposed Mpesa, because it was novel, unlike anything that had come before it. Today, we see Mpesa everywhere, even at my local bank branch, a far cry from its early opponents. Kenya is now a poster child for mobile money, a global leader in mobile payments. Meanwhile, ‘advanced’ economies like the United States and Europe, are still struggling to shift to the much coveted mobile payments. — In the grand scheme of things, Njoroge’s comments count for nothing.”
As well as Kimani’s opinion the country shows strong support for the cryptocurrency. During April-May, the highest levels of Kenyan Local Bitcoin’s trading occurred during those three months according to Coin.Dance. BitPesa is also growing quite well and has received over $1 million in venture capital funding so far. Investors such as BitFury, the Digital Currency Group, Pantera Capital, Blockchain Capital and more believe in the sub-Saharan African payment processor. BitPesa has also partnered with projects like Keheala a startup which delivers disease management tools for patients. The collaboration benefits the company quite a bit because it often pays its employees in Bitcoin. Founder & CEO of Keheala Jon Rathauser explains:
“Being in the early stages of operation in Kenya, Keheala’s payroll needs are dynamic. BitPesa has demonstrated flexibility by adjusting with the speed of changes on the ground. BitPesa beat the pricing of every other competitor.”
With initiatives such as Keheala and BitPesa partnering, Kenyans are not letting the opinions of central bankers bring them down. Technology is not going to pass them by if they can help it. Bitcoin-based mobile offerings such as BitPesa, and others have benefited Kenyan citizens a great deal so far. Ignoring this innovative growth most likely would add to the tumultuous markets within Kenya’s borders that took place last year and leave them even more so behind the times technologically.
Source: TechWeez.com, BitPesa Blog, Mindspeak forum, Standard Digital News