Bank of Namibia recently said it has included virtual assets and virtual asset service providers within its fintech innovation regulatory framework and plans to revise existing laws and regulations. According to the central bank’s governor, there is a “war between managed and unregulated money on the one hand, and sovereign money versus non-sovereign money on the other.”
Amendment to Applicable Law
The Bank of Namibia (BON) has said that while the cryptocurrency has no legal tender status in the country, it has now brought in “virtual asset service providers (VAs) and virtual assets (VASPs)” ) under its Fintech Innovation Regulatory Framework in a phased approach, through its innovation hub. The central bank added that it is also considering amending “existing laws and regulations diligently in consultation with other relevant authorities”.
In a recent release statementBON also clarified that while privately issued digital currencies are not yet legally recognized, merchants and traders can accept payment in this form provided they “willing to enter into such an exchange or transaction”.
The bank’s new stance on digital currencies seems to suggest that BON may be warming up against crypto. Like report of Bitcoin.com News, the central bank previously said it “does not recognize, support, or recommend the ownership, use, and trading of cryptocurrencies by members of the public.” The bank also warned Namibians there would be no legal recourse in the event they lost their money.
CBDC Holds ‘Huge Potential Benefits’
However, Johannes Gawaxab, governor of BON and a past critic of cryptocurrencies, is quoted in the statement acknowledging the future of money is now a pivotal point. He explained:
The future of money is at an inflection point. The battle between regulated and unregulated money on the one hand, and sovereign money and non-sovereign money on the other.
However, Gawaxab said he believes central bank digital currency (CBDC) offers something that privately issued or created digital currencies cannot. However, the governor of BON also warned that his organization, which is also exploring and studying the feasibility of implementing a CBDC, will not be in a hurry to do this.
“If CBDCs are explored and implemented with caution and care, they could offer enormous potential benefits for a more widespread, more secure, stable means of payment,” said Gawaxab. and less expensive than private digital currencies.
Meanwhile, BON revealed that it plans to release a consultation document on CBDC in October.
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