The National Bank of Ethiopia says that cryptocurrencies are illegal in the nation

It’s not new for a regulatory body to make a negative comment on cryptocurrencies, and the latest on the list is the National Bank of Ethiopia (NBE).

According to NBE, it is still illegal for residents to transact cryptocurrencies. It encouraged them to continue trading using the Ethiopian Birr. Notably, Bitcoin and cryptocurrencies are yet to be recognized by the NBE as a legal means of payment. It said in a statement:

“Ethiopia’s national currency is the Ethiopian Birr, with any financial transaction in Ethiopia to be paid in Birrs, according to the law.”

The primary reason of concern that the crypto world brings to the NBE is the alleged use for informal transactions leading to illegal activities like money laundering schemes in Ethiopia. It urged the general public to report any such “illegal transactions” if witnessing them.

NBE is not the only authority that is concerned about crypto transactions. For example, the Central Bank of Russia or CBR has constantly been opposing the use of cryptocurrencies as a means of payment in the nation and even called for an outright ban on the industry. Moreover, developing countries like India, which has the largest democracy in the world, have always witnessed the Reserve Bank of India or RBI opposing the crypto adoption in the nation. 

Ethiopia and CAR in two different corners

According to Chainalysis, illicit funds transmitted in crypto are increasing with time, although they are rapidly dropping as a share of total transactions. Ethiopia’s stance on cryptocurrency contrasts sharply with that of the Central African Republic (CAR), which made Bitcoin legal tender in April. The country is now preparing to create various types of infrastructure in order to integrate cryptocurrency into the economy.

Given the threat that Bitcoin poses to central banks, hedge fund manager Paul Tudor Jones stated last month that central banks would do everything possible to prevent its acceptance.