At present, digital assets have become a hot topic with growing interest among central banks, financial institutions and regulators. Crypto analysts believe that cryptocurrency is the gateway to escape from a centralized financial system. The southern African country Zambia is currently working on techniques to regulate cryptocurrency.
The Zambian government minister said that the Bank of Zambia and the Security Exchange Commission are jointly testing the crypto regulatory framework. The minister observed that digital assets had the power to overcome the economic crisis in this digital revolution era. He said that the government targets to reach over $4.7 million in terms of digital payments.
“Currently, Zambia is putting in place appropriate digital infrastructure, attracting investments in technology and creating access thereby positioning itself to be a hub of technology in the region,” Zambia’s Minister of Technology and Science Felix Mutati said.
Earlier, the Zambian central bank said it has to observe closely whether to introduce the central bank digital currency (CBDC) or not. Debate is about its impact on the nation it is introduced and how it would work. The bank believed that CBDC could support the long-term goal of transitioning to a cashless nation.
Though the central Bank of Zambia didn’t support the utilization of digital assets earlier, the current economic scenario changed the administration’s belief towards cryptocurrency. Mutati observed that the country’s president Hakainde Hichilema is attracted to digital assets.
“Through digital payment platforms, people will become much more included in digital financial services hence, cryptocurrency will be a driver for financial inclusion and a change maker for Zambia’s economy,” Mutati added.
As per Chainalysis data, African countries are on the top list of the world’s fastest crypto adoption nations, with a 1,200% increase from July 2020 to July 2021. El Salvador and the Central African Republic are the only countries that have adopted Bitcoin as legal tender. Some countries, such as Japan and Switzerland, have introduced new regulations for crypto assets and their service providers. Some countries, like the US, UK, UAE, and European Union, are at the drafting stage.
According to the Atlantic Council, all G7 nations have moved into the development stage of their CBDC. In 2023, over 20 countries plan to introduce a CBDC in their respective nations. Australia, Thailand, Brazil, India, South Korea, and Russia will continue or begin pilot testing this year.