Key Takeaways
- ECOWAS parliament releases report on cryptocurrency meeting
- Regional body warns of cryptocurrency volatility
- West African nations have restricted the adoption of cryptocurrencies in recent months.
ECOWAS, the regional body of West African States recently held a parliamentary section in Ouagadougou, Burkina Faso, to discuss the growing popularity of cryptocurrencies.
Following the meeting, Ecowas published a report that highlighted the many problems associated with crypto payments. According to the report, despite the growing use of crypto, it does not have the appeal and popularity of fiat currency.
The parliamentary report also noted that crypto-assets could not be compared to digital cash due to their volatile nature. It further stated that the volatile crypto market is due to their limited issuance mechanism that promotes speculation. Furthermore, the immutable and decentralized nature of crypto assets was also highlighted as negative factors.
The report also warned crypto enthusiasts in the region to brace up against the possibilities of theft. Ecowas is a body that is lukewarm to cryptocurrencies, with several countries outrightly banning crypto-assets.
Nigeria, the biggest economy in the region, had placed a blanket ban on credit institutions from processing transactions for exchanges. According to the Central Bank of Nigeria, the ban was placed due to lack of crypto regulations.
This policy by Nigeria has been adopted by other countries in the region, limiting the growth of cryptocurrencies.
West African countries are plagued by high inflation rates and devaluation of local currencies in the past decade. Many youths see cryptocurrencies in the region as a hedge against inflation, and it remains to be seen how the local crypto community receives this warning.
Do you think Ecowas is right about the dangers of cryptocurrencies?
