Africa as a continent would always pride herself on the quest for developmental excellence and innovations. In light of this, more African countries have stepped up their embrace of emerging technologies, such as blockchain technology and cryptocurrencies.
Most recently some African countries have decided to not only encourage the development and implementation of blockchain technology but have gone ahead to further deploy the use of blockchain in the central bank digital currencies (CBDC) in which Nigeria has pioneered its use and South Africa are presently reviewing the possibility of the use.
The government of Botswana has taken the bull by the horns and formally introduced to the parliament a government gazette that will regulate the blockchain technology and cryptocurrency space in the country. While this is not yet a law, it would be subject to deliberation by parliamentarians. Botswana would be the first African nation to become crypto regulated if this proposal is successful.
What are the implications?
Globally, as countries grapple with the metamorphosis of money and other blockchain-related technologies, they are very concerned about losing control of financial regulation. This has adversely affected the spread of cryptocurrencies and blockchain technology across the globe.
Botswana was keen to identify some key propositions for blockchain technology companies as outlined in the gazette as follows: “Part III further provides that the Regulatory Authority may grant a license to an applicant if it can demonstrate that it possesses the infrastructure and resources to conduct business activities of a virtual asset service provider or issuer of initial token offerings and that the applicant is a fit and proper person.”. As specified in clause 11 (2), the definition is consistent with the provisions of the Financial Intelligence Act.”.
The government of Botswana, however, suggests that they are not basically concerned about recognizing crypto trade but are putting in place a strategic plan to include “provisions for managing, mitigating and preventing money laundering and financing of terrorism” into the proposed law. This has been a major concern for most countries as they associate criminally minded individuals with cryptocurrency as their channel for their criminal activities.
It is also observed that the draft also seeks to prevent the proliferation risks that are associated with virtual assets which include the creation of tokens and new emerging business practices and technologies.
What are the benefits?
The successful implementation of the law would see the legalization of the trading and management of blockchain technology and cryptocurrencies related businesses within the nation of Botswana and as such, it would also encourage other blockchain projects to migrate to Botswana as it would be seen as cryptocurrency-friendly and a compliant nation for project development.
It is evident that there would be an influx of companies and businesses which would create more job opportunities and increase the flow of revenue into the country as opposed to countries that do not give any support and take a stand when it comes to crypto-related stance.