Cryptocurrency transactions remain prohibited in several African countries, despite the potential for introducing comprehensive regulatory frameworks to foster its development.
According to Chainalysis, Africa currently ranks among the fastest-growing crypto markets globally, with Kenya, Nigeria, and South Africa taking the lead.
Several governments harbour suspicions towards the digital asset, citing concerns such as crypto being used for money laundering, illicit activities, tax evasion, and financial fraud, owing to the complexity of tracing cryptocurrency transactions.
In 2021, the Central Bank of Nigeria (CBN) mandated all banks to close customer accounts engaged in cryptocurrency transactions. However, the financial regulator rescinded the ban in December 2023.
Nonetheless, on May 6, 2024, the Securities and Exchange Commission (SEC) intensified restrictions by announcing the removal of the naira from all peer-to-peer (P2P) platforms.
Emomotimi Agama, the Director-General of the Commission, hinted at forthcoming government regulations for the crypto sector, in line with the International Monetary Fund (IMF)‘s recommendation to regulate the industry. That said, here are ten African countries that have banned cryptocurrency.
- Tunisia: In 2018, the Tunisian central bank outlawed the use of cryptocurrencies following a statement cautioning against engaging with any digital assets not sanctioned by the state.
- Sierra Leone: Sierra Leone’s central bank prohibited two crypto firms in 2019, and also refused to grant licenses to enterprises or financial institutions for accepting deposits for crypto investment or trading.
- Republic of Congo: According to the International Monetary Fund (IMF), the Congolese government has completely banned cryptocurrencies. Additionally, a 2018 study by Ecobank highlighted the absence of a public stance from the Congolese Government and the nation’s Central Bank on the use and legality of cryptocurrency.
- Ghana: The Ghanaian government has enforced a complete ban on crypto transactions. While evaluating blockchain usage and its integration into the country’s payment system, the government reaffirmed its 2018 prohibition on crypto usage in all financial transactions.
- Algeria: In 2018, the Algerian parliament passed the Financial Law, imposing restrictions on the purchase, sale, use, and possession of cryptocurrencies.
- Lesotho: In 2018, the central bank of Lesotho issued a directive prohibiting the promotion and investment in cryptocurrency, citing its lack of regulation and licensing.
- Morocco: Morocco’s Ministry of Economy banned all forms of crypto transactions in 2017 due to violations of exchange regulations. However, the country’s central bank announced in 2023 that it was drafting new regulations for crypto trading.
- Tanzania: Although Tanzania lacks a formal regulatory framework for crypto transactions, its central bank issued a warning against trading and using virtual currencies. The bank emphasised that the only legally accepted currency is the Tanzanian Shilling.
- Cameroon: Currently, the Bank of Central African States (BEAC), serving as the sole central bank for the Central African Economic and Monetary Community (CEMAC), to which Cameroon belongs, has not implemented any regulations concerning cryptocurrency trading. The government is presently examining new regulatory mechanisms for the industry.
- Egypt: By religious decree, cryptocurrency trading is prohibited under Islamic Law. The primary Islamic authority in Egypt, Dar al-Iftai, classified Bitcoin transactions as haram in 2018. The Central Bank of Egypt followed suit in 2019 with a statement indicating its intention to develop a law banning the creation, trading, or promotion of cryptocurrencies without a license.
