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Namibia Officially Passes Law to Regulate Virtual Asset Service Providers and Cryptocurrency Exchanges

Namibia has officially approved a law to regulate Virtual Asset Service Providers (VASPs) and cryptocurrency exchanges after banning cryptocurrency exchange in 2017. The law aims to establish a regulatory body to oversee these activities and will come into effect on a date determined by the Ministry of Finance. Non-compliant individuals could face penalties of up to 10 million Namibian dollars and 10 years in prison. Despite the regulation, the Central Bank of Namibia maintains its stance of not granting legal status to cryptocurrencies in the country. This decision comes amid other African countries’ moves towards regulating cryptocurrencies, particularly after some have repealed similar laws.

  • Reversing the Ban: The Namibian government has officially signed a law to regulate Virtual Asset Service Providers operating in the country, reversing its original decision to ban cryptocurrency exchange in 2017.
  • Legislative Approval: The law to regulate Virtual Asset Service Providers (VASP), known as the Namibia Virtual Assets Act 2023, was approved by the Namibian National Assembly on July 6, 2023, and was signed by President Hage Geingob on July 14, 2023.
  • Regulatory Body: The new law aims to establish a regulatory body to supervise and regulate cryptocurrency exchange in Namibia. It is the country’s first law specifically addressing the regulation of cryptocurrency-related activities.
  • Commencement Date: The law will come into effect on a date determined by the Ministry of Finance in Namibia. Penalties for Non-Compliance: Non-compliant Virtual Asset Service Providers may face penalties of up to 10 million Namibian dollars (approximately 671,000 US dollars) and up to 10 years in prison.
  • Legal Status of Cryptocurrencies: Despite the regulation, the Central Bank of Namibia maintains its position that cryptocurrencies will not have legal status in Namibia.
  • Reversal Timeline: The reversal of Namibia’s ban began in May 2018 when the Central Bank of Namibia reviewed its initial decision to ban cryptocurrency exchange.
  • South Africa’s Regulation: Earlier this month, the financial regulator in South Africa announced that all cryptocurrency exchanges in the country will be required to obtain licenses by the end of 2023 to continue their operations.
  • Other African Countries: Several African countries have passed laws regarding cryptocurrencies, including Botswana, Kenya, Mauritius, and Seychelles.
  • Bitcoin as Legal Tender: The Central African Republic made Bitcoin legal tender in April 2022, but this legislation was reversed in less than 12 months.
  • African Countries with Bans: According to the International Monetary Fund, some African countries have imposed a ban on cryptocurrencies, including Cameroon, Ethiopia, Lesotho, Liberia, the Congo Republic, Sierra Leone, Tanzania, and Zimbabwe.

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