Amid the global race to regulate crypto, Ghana, a country in West Africa, has now stepped up to draft new rules for this nascent financial sector.

According to the document published earlier today, the Bank of Ghana (BoG) has now taken action towards establishing a regulated framework for cryptocurrencies such as Bitcoin and Tether, unveiling a set of draft guidelines to strengthen the oversight of digital assets.

The document reveals that this development extends a review conducted over the last three years, reflecting an increasing national engagement with cryptocurrencies.

Regulations In The Works

The proposed regulations mark a significant milestone in Ghana’s journey towards embracing the cryptocurrency sector. The central bank is now actively soliciting input from both public and industry stakeholders to refine and finalize the regulations. The document read:

This is in line with the Bank’s commitment to continuously evolve a conducive regulatory environment that promotes financial inclusion and enhances financial stability.

Notably, the BoG’s draft guidelines introduce an eight-pillar framework designed to address various risks associated with digital assets, such as money laundering, terrorism financing, and consumer fraud.

Central to these regulations is “enhancing” registration and reporting protocols for cryptocurrency exchanges and other virtual asset service providers (VASPs).

Under the new rules, exchanges must implement “strong” mechanisms to monitor and report suspicious transactions, aligning with the Financial Action Task Force’s Travel Rule.

Guiding The Crypto Sector In Ghana

Furthermore, the proposed regulations mandate that all crypto exchanges undergo a “thorough registration process” with the BoG and participate in sandbox testing before they are allowed to operate.

According to the draft, this step is crucial in ensuring that all market players adhere to the “highest standards of security and operational integrity.”

The collaborative efforts between the BoG and external entities, including commercial banks and offshore regulators, aim to create a cohesive regulatory environment supporting the digital economy’s growth while protecting stakeholders.

The feedback period, which is open until August 31, provides an opportunity for industry experts, crypto enthusiasts, and the general public to contribute to shaping Ghana’s digital currency regulatory space. The BoG noted in the document:

The Bank values the perspectives and recommendations of industry players, experts, and the public regarding the proposed regulatory measures outlined in this document. […] The Bank will consider these inputs in determining the next steps forward.

It is worth noting that this consultation period is crucial for the country’s crypto space as it will likely influence the final structure of the regulations, whether negative or positive and the implementation.