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- The government is pulling all strings to regulate cryptocurrency in the country.
- Several Ponzi and pyramid schemes took away thousands of dollars of the investors.
- Regulations will pave the road as more investors will have trust in the authority.
Uganda is one the few African countries that do not regulate cryptocurrency or consider it to be a legal tender. They have issued several notices’ to educate citizens but it doesn’t seem to be working.
Moreover, Ponzi schemes have shook the economic balance of the country and reels under political pressure. Regulation of digital assets is a growing demand among investors that are trading or investing their hard earned money on such currencies.
More African Countries regulate Cryptocurrencies
Africa is the second largest hub of mining and trading of cryptocurrency after China. Therefore any form of regulations will have a significant impact on the market. Uganda has issued a public advisory in 2017 stating that cryptocurrency like Bitcoin and Ethereum are not to be considered as legal tender. It also stated that no agencies have been authorized to deal in digital assets to protect investor rights and duties.
But despite the risks, the citizens can actually start investing for the long term. The absence of a central authority is pivotal to regulate demand and supply within the market. Criminal transactions hence have risen since the entrance of cryptocurrencies. in the country. It has dampened the spirits of new investors as people continue to terrorize normal investors with their force and power.
Bitcoin scams have eroded considerable amount of wealth
An alleged crypto scam that was underway by the name of Dunamiscoins took money from 5,000 investors and failed to repay them as promised. The perpetrators of the $2.7 million scam were put on trial in early 2020 which made future investors aware of the pitfalls of digital currency.
The Financial Intelligence Authority has ordered the government to draft policies at the earliest to prevent such scams from taking place in the future and avoid illicit activities.
Safe investment tool with regulations
Experts believe that cryptocurrency would be an excellent investment tool if regulated with the required number of policies to help keep it afloat. The government had requested a lot of crypto exchanges to register themselves with the regulatory authority but only a handful of them complied.
Hence it is tedious to govern their activities. Pyramid schemes rose exponentially as thousands of dollars were stolen from citizens as well as Ugandan legislators.
Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.
