The Bank of Ghana has released draft regulations aimed at creating a framework for the cryptocurrency industry. The rules are designed to protect consumers, prevent financial crimes, and encourage financial inclusion. Virtual asset service providers (VASPs) will be required to register and meet strict standards, while commercial banks are prohibited from dealing directly with virtual asset businesses. The public has a chance to provide feedback on the proposed regulations before they are finalized.
Surge in Digital Asset Use Underscores Need for Regulation
The Bank of Ghana (BOG) recently unveiled draft regulations to create a digital asset regulatory framework. Released Aug. 16, the rules aim to foster financial inclusion while protecting cryptocurrency users. The central bank’s decision followed a comprehensive analysis of digital assets like bitcoin (BTC) and the USDT stablecoin.
The analysis found that Ghana’s tech-savvy population is increasingly using digital assets, driven by widespread internet access and the rise of virtual asset service providers (VASPs). While crypto use remains low compared to traditional finance, the BOG identified its role in cross-border payments and remittances as necessitating regulation.
These regulations seek to address money laundering, fraud, and cybersecurity threats while complying with international standards.
A report in the Graphic Business said the regulations primarily focus on overseeing cryptocurrency exchanges and VASPs. Under the proposed laws, these entities must register with either the central bank or the Ghanaian Securities and Exchange Commission (SEC). Exchanges would also report suspicious transactions to the Financial Intelligence Center.
Furthermore, VASPs must meet capital requirements and have internal controls and risk management frameworks. The draft regulations clarify that commercial and registered financial institutions can only provide services to registered VASPs. No bank or financial institution can deal directly with a virtual asset-related business.
Before finalizing the regulations, the BoG will conduct a sandbox testing process to identify potential issues or refine the rules. The public can submit feedback until Aug. 31, the report said.
