Rwanda is contemplating launching a Central Bank Digital Currency (CBDC) because it does not want to be left behind and to prevent any hindrances to trade between the African country and its major trading partners. According to a deputy governor with the National Bank of Rwanda, the country should be prepared for digital currencies being […]
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Rwanda Government Orders Banks to Stop Facilitating Crypto-Related Transactions
According to the National Bank of Rwanda, the country’s regulated financial services providers are now prohibited from facilitating crypto-related transactions. In her Jan. 31 letter justifying the decision, the acting governor Soraya Hakuziyaremye cites the unregulated status of most crypto assets and how this leaves users without the “guarantees and safeguards associated with regulated financial services.”
Rwanda’s Growing Interest in Crypto
The National Bank of Rwanda (NBR) has said the country’s financial services providers are forbidden from engaging in “any crypto-related activities until a regulatory framework has been put in place.” In a letter addressed to managing directors and CEOs of financial services providers, the NBR’s acting governor Soraya Hakuziyaremye suggested that the prohibition would help to ensure “efficient and sound financial services.”
Despite the central bank’s 2018 warning against crypto-related activities, Hakuziyaremye acknowledged in her letter that Rwandan residents have continued to trade digital assets like bitcoin. According to the letter, available data suggest that “more than three million U.S. dollars were traded on [the] Rwanda market since January 2020.”
Meanwhile, in the same letter, Hakuziyaremye sought to justify the central bank’s decision to bar financial services providers from facilitating crypto-related transactions.
“Although crypto asset activities are still limited and therefore, do not pose substantial risks to [the] financial and monetary system of Rwanda, the NBR is concerned about the involvement of the financial institutions in crypto activities,” Hakuziyaremye said.
Crypto-Related Activities Lack ‘Guarantees and Safeguards Associated With Regulated Financial Services’
In the Jan. 31 letter, the acting NBR governor cites the unregulated status of most crypto assets and how this leaves Rwandese users without the “guarantees and safeguards associated with regulated financial services.” The letter also points to how crypto investors elsewhere have been defrauded by scammers like Ruja Ignatova of Onecoin and Gerald Cotten of Quadriga crypto exchange.
Hakuziyaremye’s letter also attempts to draw Rwandan crypto investors’ attention to the decisions that some regulators have taken against unregulated crypto entities.
“For example, Binance, whose presence was noticed in Rwanda, is under investigation in the United States of America over money laundering allegations. The same company has been banned by the Financial Conduct Authority (FCA) due to weak consumer and investor protection mechanisms,” the acting governor said.
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Rwanda Reportedly Considering National Digital Currency
The post Rwanda Reportedly Considering National Digital Currency appeared first on DCEBrief.
Trading Platform Paxful Completes Construction for Second School in Rwanda
n nn nn Children in the Rwandan village of Kasebigege are being given a greater chance to pursue a sound education as construction on a new school, developed by bitcoin marketplace Paxful, has been completed.Located in the Bugesera District, the school is a primary institution designed for children between the ages of 6 and 15. It’s Paxful’s second Philanthropic endeavor in the village, and construction was finished roughly one year after the company bui
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Rwanda to Use Blockchain to Eradicate Conflict Resources from Supply Chain
The government of Rwanda is leading an innovative mineral traceability initiative using blockchain.
To that effect, the project is working with U.K.-based startup Circulor and its blockchain powered supply chain platform to record the provenance of metals in order to eradicate sources of funding for conflict minerals.
Circulor to Help Rwanda Comply with International Agreements
Tantalum – a rare metal used to make consumer electronics, chemical process equipment, nuclear reactors, aircraft, and missile parts – is mostly found in Central Africa, including Rwanda and the Democratic Republic of Congo. As the natural resource is extracted in conflict zones and sold to perpetuate the fighting, it has become considered a conflict metal.
Francis Gatare, a Rwandan government minister and the CEO of the Rwandan Mining, Petroleum and Gas Board, said the initiative is already being implemented by at least one exporter from Rwanda, in order to comply with the internationally mandated efforts to stop the funding of conflict minerals. PRG Resources, a mining company who supplies Apple with tantalum, is reportedly using the system.
The Circulor platform will be used by companies to tag and trace tantalum mined in the country as the supply chain becomes more transparent with the blockchain system. Even intermediate products mixed with other raw materials will be listed on the platform, according to Douglas Johnson-Poensgen, CEO of Circulor.
“Circulor’s technology will bring greater transparency to the tantalum supply chain. Our blockchain platform will empower consumers to understand where the materials in the products they buy come from and also make it harder for materials that are not ethically sourced to pass through the supply chain. It will also dramatically reduce costs for miners who current shoulder a disproportionate share of the cost of compliance.”
Built on Hyperledger Fabric, the platform will not only help compliance of international agreements regarding the removal of conflict resources from the supply chain, but will also record all stages of production before it reaches the end consumer.
The Wall Street reform known as the Dodd-Frank Act approved during Barack Obama’s presidency included legislation regarding conflict minerals. The law compelled U.S. companies to audit their supply chains to make sure they don’t fund militias in war-torn countries.
Corruption, bureaucracy, and logistical delays using legacy processes, however, have led foreign companies to look elsewhere, which has driven prices down and weakened the mining economy. The blockchain powered solution may bring the wanted transparency with a speedier process.
Featured image from Shutterstock.
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Bitcoin Marketplace Paxful Builds School For Students in Rwanda
Paxful, the peer-to-peer bitcoin marketplace that enables its users to purchase and sell bitcoin instantly, has funded the construction of a school for young students in Rwanda.
Located in Kasebigege Village in the Bugesera District of Rwanda, Paxful’s bitcoin-funded school will serve children aged from 3 to 6 in a town with over 7,500 residents. The school has three classrooms, four restrooms, irrigation system, and a 35,000-liter water tank, providing a stable source of water supply for both the students and local residents.
By contributing ,000 in bitcoin, Paxful contributed to the Education is Life project and Water Well project, building schools and providing a better ecosystem in partnership with Zam Zam, a non-profit organization that focuses on helping students and families in Afghanistan, Gaza, and Rwanda.
“Paxful cares about corporate responsibility, and they believe that positive things can happen through Bitcoin. The Education is Life project is not only a model for what can be built with Bitcoin, but is a model for how we create and sustain successful corporate partnerships,” said the Zam Zam team.
Last month, CNBC featured a documentary covering the efforts of the Paxful team building a school in Rwanda using bitcoin as the primary source of funds. The Paxful team intends to fund more schools and infrastructures in Africa in the future, with donations raised from the cryptocurrency community with bitcoin.
“One of our key goals is to bring financial inclusion to the underbanked, via bitcoin. #BuiltwithBitcoin is the next logical step. Now we are not only helping those in emerging economies meet their day-to-day financial needs; through our work with Zam Zam, we are also making a real and lasting difference in their communities. We hope that others in the cryptocurrency scene will join this important venture,” said Ray Youssef, Paxful CEO and co-founder.
Last year, in December 2017, Ethereum co-founder Vitalik Buterin expressed his concerns over the valuation of the cryptocurrency market and whether the community has done enough to support the global financial system, bank the unbanked, and assist individuals in third world economies with blockchain technology.
“How many unbanked people have we banked? How much censorship-resistant commerce for the common people have we enabled? How many Venezuelans have actually been protected by us from hyperinflation? The answer to all of these questions is definitely not zero, and in some cases it’s quite significant. But not enough to say it’s .5T levels of significant. Not enough,” said Buterin.
In regions like Rwanda, wherein the majority of individuals struggle to obtain stable banking services due to poor financial infrastructure, decentralized cryptocurrencies like bitcoin allows anyone to freely transact and settle payments on a peer to peer basis.
As such, with bitcoin donations, even without the existence of an intermediary, projects led by non-profit organizations such as Zam Zam in partnership with Paxful can be funded.
Arthur Schaback, the co-founder and CTO at Paxful, emphasized that the company plans to continue demonstrating the impact a decentralized financial network can have on the entire world.
“We will continue to build and perfect this model so that the entire world can see what a real difference can be made with bitcoin. We take the same philosophy with our product and are building the Paxful wallet as the model financial services application for the entire world,” Schaback said.
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