The increasing usage of cryptocurrencies has alarmed Kenyan officials, who have warned that trading in cryptocurrency may increase the danger of money laundering and the funding of terrorism.
Governor of the Central Bank of Kenya (CBK), Kamau Thugge, stated that because the cryptocurrency industry is evolving so quickly, there is a need for international laws to safeguard individuals from hazards.
Dr. Thugge cited a lack of legislation prohibiting cryptocurrency trading as a potential pathway for the sector to be used as a conduit for money laundering and terrorism funding when testifying before an ad hoc committee of the National Assembly on Tuesday. The committee was looking into the operations of Worldcoin in Kenya.
The CBK chairman urged caution, noting that supervisory cooperation is required to control the market due to the global reach of crypto assets.
Unregulated cryptocurrency markets, according to him, might have an impact on monetary policy and control, jeopardize the security of vital national infrastructure, and increase cybercrime fraud and scams.
“In Kenya for example, we have not licensed any cryptocurrency. However, trading in the currency has not been made illegal because there is no regulation or legal framework in place,” the CBK governor said.
He stated that the financial reporting center is now leading an ongoing risk evaluation of virtual assets and the companies that supply virtual asset services.
Sam Altman, the CEO of OpenAI, established the Worldcoin project, which began operating in the nation in April 2022.
The introduction of a peer-to-peer (P2P) exchange, which enables people to rapidly and easily access digital currencies and US dollars directly with one another without the need for a centralized third party to handle the transactions, is one of the crucial aspects of Worldcoin’s debut in Kenya.
With an estimated four million users, Kenya’s cryptocurrency market has been rapidly expanding in recent years. However, according to Dr. Thugge, no survey has been conducted to determine how often cryptocurrencies are used in Kenya.