News

Bitcoin is Not a Legal Tender, Zambia’s Central Bank Warns

The Central Bank of the Republic of Zambia has released a public statement warning its citizens that Bitcoin is not a legal tender in the country, according to Lusaka Times, a local news outlet.
Following incessant inquiries towards the state of cryptocurrencies in the country and the gradual decline of the “Zambian Kwacha,” the government has moved swiftly to warn people about its legal take on Bitcoin as more Zambians begin to turn to the popular digital currency.
Releasing an official statement, the Bank of Zambia conceded that though the Bitcoin might have monetary characteristics and could be used in peer-to-peer transactions, it is by no means, an accepted legal tender in the country.
The authority has taken pains not to ban the cryptocurrency outright, but to warn the public of the uncertainty and volatility that plague cryptocurrency markets. It maintained that the statement had been issued to “safeguard the interests of members of the public and to maintain the integrity of the financial system.”

The Stance of the Constitution

In a long statement that referenced five quotations from the constitution of the country in regards to the aspect of finance, the central bank cited constitutional reasons why Bitcoin and other cryptocurrencies cannot be considered a legal tender in Zambia. It pointed out the fact that although Bitcoin was not issued by BoZ, the Central Bank has no constitutional authority or obligation to ban the crypto market in the country. An excerpt from the statement read:

“Firstly, Section 30 of the Bank of Zambia Act vests the right to issue notes and coins exclusively in the BoZ. To date, BoZ has not issued any form of cryptocurrency. Cryptocurrencies are not legal tender in the Republic of Zambia; Secondly, BoZ does not oversee, supervise nor regulate the cryptocurrency landscape. Consequently, any and all activities related to the buying, trading or usage of cryptocurrencies are performed at owner’s risk.”

While the central bank is not out to ban crypto-related activities in Zambia, it issued a public-interest, reiterating to interested parties and investors looking to invest in the cryptocurrency, of the risks involved in investing in the crypto-space. It implored Zambian investors to be aware of all possible risks associated with the digital market and warned that the bank nor the government is prepared to provide any legal refuge to Zambians who eventually become a victim of cryptocurrency-related crimes.