Bank of Zambia
Bank of Zambia

The Bank of Zambia has warned that Cryptocurrencies are not legal tender in Zambia and that all activities related to their buying, trading or usage are performed at owner’s risk.

The Central Bank says it has observed an increasing public interest in cryptocurrencies as evidenced by the growing number of enquiries that BoZ has been receiving on the subject.

In a statement, the Bank of Zambia said while cryptocurrencies have some monetary characteristics, such as, being used as a means of payment on a person to person basis, cryptocurrencies are not legal tender in Zambia.

“In order to safeguard the interests of members of the public and to maintain the integrity of the financial system in Zambia, the BoZ states as follows: 1. Section 30 of the Bank of Zambia Act vests the right to issue notes and coins exclusively in the BoZ. To date, BoZ has not issued any form of cryptocurrency. Cryptocurrencies are not legal tender in the Republic of Zambia; 2. BoZ does not oversee, supervise nor regulate the cryptocurrency landscape. Consequently, any and all activities related to the buying, trading or usage of cryptocurrencies are performed at owner’s risk.”

It adds, “3. The general public should therefore fully understand and be aware of the risks associated with the use of cryptocurrencies. 4. Some of these risks include money laundering, financing activities of terrorism and general consumer protection risks such as fraud and hacking, to which in most cases, no legal recourse would be available to customers due to the unregulated nature of cryptocurrency-related transactions.”

“5. In line with BoZ’s position that regulation should not constrain but enable innovation, BoZ will continue to actively monitor all developments.”

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9 COMMENTS

  1. In order to use Bitcoin you need wallets, exchanges, payment processors, etc. Not all of these services have perfect security and if your funds are stolen, all you can do is to hope your service provider will be kind enough to give you a refund.Mt. Gox, where thousands of users were left without their funds after a big hacking attack, is the worst example of this.Bitcoin has no safety mechanisms. Typically, you’ll get a private key or random words which protect your wallet. If you lose your key, your funds will be gone with it. There’s no support to contact, no way to change the password, and no way you could verify your identity to get your account back. When it’s gone – it’s gone, there’s nothing anyone can do.

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  2. I am happy and impressed with the position BoZ has taken on this. They are not saying that crypto-currencies are illegal in Zambia but that they are currently unregulated…so urging caution and use at your own risk. Most reasonable position to take under the circumstances!

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  3. Considering that Cryptocurrency (Bitcoin) has got so much value and Zambian Kwacha has kept on loosing value, wouldn’t regulating Bitcoin be a great push to the economy? Quick adaptation to change may be of great benefit to our economy I guess. More and more people and nations are jumping into that investment and they are benefiting. Soon it will be more expensive to invest in it I guess.

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  4. Zimbabwe and Argentina are two countries where people have benefited from Bitcoin after the economies of these countries collapsed. I like the position taken by BoZ where they have recognized that these asset classes can spur innovation. Now you can pay someone peer to peer. I remember my grandfather used to wait many months before he could be paid for his crop. Now a farmer can be paid on the spot as long as he has a cellphone. Imagine a fisherman being aid for his catch even before he has come back on shore!!

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  5. Kinda of hollow warning BoZ, yeah its not legal tender inside Zambia but in the age of internet you can stop Phiri or Mweene from trading online and cashing in on cryptocurrencies overseas.

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  6. Points taken:
    Its not illegal, it has monerary value, can be used to trade person to person and not regulated by banks.
    Thats what makes it a perfect currency.
    The money being used right now in money laundering, funding wars and corruption is in fiat courrecies.

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  7. BOZ has a conceptual misunderstanding of what Crytos are. If you transact electronically on platforms such as ewallet where what is being transferred is an account balance or rather ledger, you are already trading a Crypto.

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  8. BOZ should not stifle people’s initiatives to escape poverty in Zambia and Africa generally. The role of government is to promote productive ventures like this one to uplift life standards of it people. These banks in Zambia and other financial institutions are giving us peanuts on our investment s and when we get loans from them we pay heavily. Let heritage coin resources ltd be allowed to continue because they are duly registered with pacra and have a comprehensive insurance cover. We understand the risk s involved as investors. Its our hard earned money. We know that banks are scared by this new competitor and hence these in called for maneuvers.

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