The Parliament of the Economic Community of West African States (ECOWAS) has joined the list of African organizations that have warned against the use of cryptocurrencies. In its warning to crypto users in West Africa, the legislative body insists that these digital assets are too volatile and that, as such, “their use on the African continent is not without dangers. “.
Refusing to accept crypto is not a violation of legal provisions
According to a report, this parliamentary warning comes after the meeting of the joint committee held in Ouagadougou, Burkina Faso. The meeting, according to the report, was called to explore “the prospects for cryptocurrencies as an investment facilitator.”
However, following the meeting which was also attended by “cryptocurrency experts and resource persons”, the joint committee reminded crypto users in the sub-region of the many shortcomings of digital currency. According to the report, one of the downsides of cryptocurrencies is that while they can be used as a medium of exchange, users can still refuse to accept them as a form of payment. Such refusal is not currently considered a violation or contravention of the relevant laws.
Meanwhile, the joint committee also asserted that cryptocurrencies cannot be equated with electronic money due to their volatile nature. According to the committee, this crypto volatility stems from their “restrictive issuance mechanism that encourages speculation.” Therefore, the ECOWAS Parliament is now urging “crypto enthusiasts to guard against the risk of theft”.
The report also lists other supposed risk factors facing users of crypto assets. These include the irreversible nature of some crypto transactions, the lack of a central authority that oversees or controls the transactions, and the concentration of assets in a few hands.
What do you think of the ECOWAS warning on the risks associated with the use of cryptocurrencies? Let us know what you think in the comments section below.
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