Key takeaways
- Morocco is preparing a law to regulate crypto assets, moving away from its 2017 ban.
- The central bank is considering creating a CBDC to improve financial inclusion and control of digital currencies.
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Morocco is set to legalize crypto assets after a ban in place since 2017, Reuters reported on Tuesday. The legislation aims to provide a legal framework for the transactions and use of cryptocurrencies in the country.
Abdellatif Jouahri, governor of Morocco’s central bank, Bank Al Maghrib (BAM), said the bank was preparing a bill to regulate crypto assets, which is currently being adopted.
BAM is also exploring the possibility of introducing a central bank digital currency (CBDC). Jouahri said many countries are evaluating the role of CBDCs in achieving public policy objectives, particularly in promoting financial inclusion.
“Regarding central bank digital currencies, and like many countries around the world, we are exploring to what extent this new form of money could contribute to the achievement of certain public policy objectives, particularly in terms of inclusion financial,” Jouahri said.
Unlike decentralized crypto assets, a CBDC would be under the direct control of the central bank.
Currently, 134 countries are exploring central bank digital currencies (CBDCs), according to data tracked by the Atlantic Council. This figure represents a jump from just 35 countries in May 2020.
Of these, 66 countries are in advanced stages of exploration, which include development, pilot testing or large-scale launches. The data also shows that all G20 countries are exploring CBDCs, and 19 of them are reaching advanced exploration stages.
Morocco banned the trading of cryptocurrencies in 2017, mainly due to concerns about the risks associated with their use. Morocco’s central bank has warned the public of the possibility of crypto assets being used in illicit activities, including money laundering and terrorist financing.
In November 2017, the Office des Changes, responsible for regulating foreign exchange in Morocco, issued a public statement declaring that transactions involving virtual currencies were illegal and punishable under current laws.
The regulatory environment at the time was influenced by global skepticism towards crypto, as many countries issued warnings about the unregulated and volatile nature of digital assets.
Despite the existing ban, Moroccans continued to use digital assets through clandestine channels.
Bolivia, first country which enacted a total ban on cryptography, announced earlier this year that it would lift the ban to modernize its payment system. Financial institutions are authorized to engage in transactions involving digital assets.
China began restricting crypto in 2013, then banning it outright in 2021. The People’s Bank of China (PBOC) first banned financial institutions from dealing in crypto assets, then banned all transactions cryptocurrencies, including initial coin offerings and domestic exchanges.
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