Namibia: Bitcoin payments enabled – The Cryptonomist

The Central Bank of Namibia has announced that despite no cryptocurrency having legal tender status in the country, payments in Bitcoin and other crypto will still be allowed. 

NAMIBIA: 🇳🇦 Central Bank says cryptocurrencies like Bitcoin can be accepted for payment.

Global adoption is rising! 🚀

— Bitcoin Archive 🗄🚀🌔 (@BTC_Archive) October 6, 2022

Namibia: Central Bank allows Bitcoin payments

The BoN (Central Bank of Namibia) stressed in a press note in late September that although digital currencies such as Bitcoin (BTC) are not yet legally recognized, retailers can take money in this form if they wish. 

But as reiterated also on the bank’s official website, this does not mean that the Central Bank has changed its mind about Bitcoin and cryptocurrencies in general:

“Because of the unregulated nature of cryptocurrencies, BoN does not recognise, support and recommend the possession, utilisation and trading of cryptocurrencies in Namibia and by members of the public. Hence, BoN urges the public to invest their money responsibly and desist from any engagements or activities related to unregulated currencies such as Bitcoin and others.”

Slowly but surely.

» Namibia’s central bank says Bitcoin can be accepted as payment https://t.co/s8WUdowYK6

— CZ 🔶 Binance (@cz_binance) October 6, 2022

The CEO of Binance Changpeng Zhao, for example, tweeted the news expressing satisfaction with a fact that can only be considered another step forward for the crypto sector in finance and the payments system.

The president of the BoN said they have brought “virtual asset service providers (VASPs) under its Fintech Innovations regulatory framework in a phased approach through its innovation hub.” The central bank also added that it is also considering amending “applicable laws and regulations diligently in consultation with other relevant authorities.”

The future of digital assets in Namibia

Johannes Gawaxab, the governor of the BoN and a past critic of cryptocurrencies who has always been quite critical and skeptical of cryptocurrencies, not wanting to endorse their use, would seem to have changed his mind, believing that: 

“The future of money is at an inflection point. The battle between regulated and unregulated money on the one hand, and sovereign versus non-sovereign money on the other.”

However, the BON president reiterated that in his view the real future of digital currencies is CBDCs, because they offer something that privately issued or created digital currencies cannot. In a speech that seemed in some ways contradictory, the BoN governor said that his country is not yet working on its own state-issued digital currency and does not seem intent on doing so in the near future.

Gawaxab stated:

“If CBDCs are explored and implemented with due care and caution, they could hold immense potential benefit for a more stable, safer, more widely available, and less expensive means of payment than private forms of digital money.”

On the other hand, it now seems indisputable that cryptocurrencies are becoming increasingly popular in Africa and other developing countries. This at least is what is evident from a report recently published by UNCTAD, a United Nations agency. 

Significant proportions of the populations of Kenya (8.5%), South Africa (7.1%) and Nigeria (6.3%) use these digital currencies. While in June, the Central African Republic adopted Bitcoin as legal tender, following the example of El Salvador, which made this choice in September.

Cryptocurrencies are very successful especially among the less affluent parts of the population that often do not have access to traditional banking systems and see cryptocurrencies as a useful payment system that is also useful as an anti-inflation tool, usually very high in countries such as Kenya, Nigeria or Tanzania.

Crypto adoption in the rest of Africa

Nigeria itself recently already launched an initial prototype digital state currency, the E Naira, which the country’s central bank has reiterated that it wants to further promote. On the other hand, according to a recent survey, about 35% of the Nigerian population is already using or holding cryptocurrencies, while 54% said they would be ready to explore their use.

This from Nigeria is the second state digital currency to be officially launched after that of the Bahamas. But it is surely soon to be followed by other countries on the great African continent. The South African Reserve Bank, for example, is experimenting with a new CBDC, which could be used only by financial institutions for interbank transfers, as part of the second phase of its Project Khokha. The country is also participating in a cross-border pilot project with central banks in Australia, Malaysia and Singapore.

Ghana’s central bank has been experimenting for months with its own CBDC project, the e-Cedi, which can be used by anyone with a digital wallet, in the same way as a fiat currency.

After all, according to Chain Analysis’ 2022 Global Crypto Adoption index ranking, which measures the degree of cryptocurrency adoption in various countries around the world, the top 20 positions include no less than three African countries: Nigeria in 11th place, Morocco in 14th and Kenya in 19th.