Bitcoin threatens Kenyan economic stability

The cryptocurrency’s unregulated nature is a breeding ground for terrorism and money laundering, according to the institution, which has placed adverts online and in newspapers to warn citizens against its use.

“This is to inform the public that virtual currencies such as Bitcoin are not legal tender in Kenya and therefore no protection exists in the event that the platform that exchanges or holds the virtual currency fails or goes out of business,” reads the notice.

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CBK reiterates that Bitcoin and similar products are not legal tender nor are they regulated in Kenya. The public should therefore desist from transacting in Bitcoin and similar products

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CBK appears to have taken particular umbrage to the idea that Bitcoins are unregulated, which means that the central bank has no jurisdiction over its use in the country.

There have been conflicts on interest within Kenya’s government, too, as Joseph Mucheru, Cabinet Secretary for the Ministry of ICT, stepped down from his role as Director for Bitcoin company BitPesa due to a “conflict of interest”.

According to CryptoCoinNews, BitPesa and compatriot company Safaricom are in a court dispute as a result of Safaricom’s decision to terminate services to M-Pesa, used by BitPesa, based on a claim that it wasn’t in compliance with Kenya’s anti-money laundering laws.