Any Transactions of Virtual Assets are Prohibited, NBE Declares

Any transactions involving virtual assets are prohibited unless expressly authorized, Ethiopia’s Central Bank said in a statement, alerting the public of “significant risks” engaging in such activities entails. The National Bank of Ethiopia (NBE) issued a public notice on Thursday, reiterating its position on virtual assets. The Bank said, “the use, purchase, sale, exchange, transfer, trading, settlement and facilitation of transactions involving virtual assets are prohibited unless expressly authorized by the National Bank under the existing legal framework.” “This prohibition is not limited to cryptocurrencies, and extends to digital representations of value that can be electronically traded, transferred, exchanged, or used for payment, investment, or similar purposes,” it reiterated. The NBE, the nation’s central bank, insisted the prohibition on virtual assets should not be interpreted as solely applying in cryptocurrencies. Instead, the bank said it cover one or more activities involving: • Exchange between virtual assets and fiat currencies,• Exchange between one or more forms of virtual assets,• Transfer of virtual assets,• Safekeeping and/or administration of virtual assets or instruments enabling control over virtual assets, and,• Participation in and provision of financial services related to an issuer’s offer and/or sale of virtual assets. “The National Bank therefore advises members of the public to refrain from engaging in any transactions and activities involving virtual assets … and avoid exposure to significant risks,” the public notice reads. The risks mentioned by the NBE include “legal, scams, frauds, cyber-related threats, operational failure, market manipulation, and substantial financial losses.”