NDN Staffer
WINDHOEK, July 27 — In a significant development, Namibia has joined the growing list of African countries regulating cryptocurrency by passing the Namibia Virtual Assets Act 2023. The law, approved by the National Assembly on July 6, signed by the President on July 14, and officially inserted into the Gazette of the Republic of Namibia on July 21, aims to govern the operations of virtual asset service providers (VASPs).
Under this new law, VASPs are required to obtain a license from the government and adhere to various regulations, including measures to combat anti-money laundering and counter-terrorism financing (AML/CTF).
Notably, cryptocurrencies are not recognized as legal tender by the law, but their use as a payment method is permitted.
To ensure compliance, the law imposes stringent penalties for VASPs that fail to abide by the regulations. Violators may face fines of up to 10 million Namibian dollars (approximately $670,000) and up to 10 years in prison.
Namibia’s decision to regulate cryptocurrency aligns with a broader trend across Africa. Other African countries, such as South Africa, Botswana, Kenya, Mauritius, and Seychelles, have also enacted laws to govern cryptocurrencies.
The continent is witnessing a significant surge in cryptocurrency adoption, with crypto transactions in Africa peaking at $20 billion per month in mid-2021, as reported by Chainalysis.
Various factors contribute to the rising adoption of cryptocurrencies in Africa, including the region’s high levels of financial exclusion and the demand for more efficient and secure methods for sending and receiving money.
While cryptocurrency regulation in Africa is still in its early stages, the proactive and progressive approach taken by many countries indicates the continent’s recognition of the potential benefits and risks associated with this emerging technology.
