The Ghanaian Securities and Exchange Commission (SEC) has announced its intention to develop regulations for cryptocurrency.
In pursuit of this goal, the SEC has initiated a task force to assist in building expertise and understanding of cryptocurrency.
- The commission’s director-general, Daniel Ogbamey-Tetteh, announced this development at the Ghana capital market’s 2023 conference, which also doubled as its 25th anniversary.
- According to Ogbamey-Tetteh, the commission is keeping in line with directives from the International Organization of Securities Commissions (IOSCO), to which Ghana’s SEC is a signatory.
- He said that the international organization for securities regulators in countries around the world encouraged its members to stay on top of crypto assets to protect investors.
- Ogbamey-Tetteh added that the SEC formed the task force to help it develop the capacity to regulate crypto assets.
- He did not reveal the identities of the task force members, nor did he give a specific scope of the work they have been tasked to do.
- He said:
“We are in the era of digital assets – and taking a cue from IOSCO who are encouraging its members to incorporate frameworks in their respective regulations to oversee the activities of digital/crypto assets in order to minimize potential harm to investors, we have commissioned a task force to assist the Commission acquire requisite capacity in that space.”
Why this matters
- Due to the novelty of the technology, regulators have often been accused of lacking a proper understanding of digital assets.
- In addition, a lack of comprehension of the nature of asset class has been named a barrier to formulating effective regulations.
- While many African countries are working on drafting regulations for digital assets, others, such as Kenya, have gone down the taxation route, introducing heavy and stifling taxes.
- Kenya only moved for proper regulations after these taxes had come into effect.
- Last month, the Kenyan parliament tasked the Blockchain Association of Kenya (BAK) with developing a draft bill regulating digital assets.
- Ghana’s SEC implied that the task force it has set up was to help it understand the crypto space and prepare itself for regulations.
- Cryptocurrencies are banned in Ghana. Earlier this year, Ghanaian authorities reiterated this position, stating that the country’s financial institutions are instructed not to engage in crypto-related transactions.
- South Africa remains the only African country to have provided regulatory clarity around digital assets. The country added crypto companies to a list of accountable institutions and mandated licensing for exchanges.