Kenya’s Cabinet Secretary for the National Treasury, Henry Rotich, has been given two weeks by the Kenyan parliament to decide whether cryptocurrencies should be made legal tender in the country. Rotich was asked to explain why the Treasury and the Central Bank of Kenya (CBK) has allowed Kenyans to trade in cryptocurrencies, yet they are unregulated, have no proper license or taxation by the Finance and National Planning Committee.

Joseph Limo, the Committee chairman, said: “We are surprised to hear that even the CBK is not aware that there is a lounge at Kenyatta University, an ATM in town, and a hotel in Nyeri which trade in bitcoins. There is a bigger problem in Kenya since people are trading billions in virtual space yet the Treasury has not licensed and taxed it like trade in M-Pesa and bank transactions.”

Cryptocurrencies are digital currencies that utilise cryptography for security and are not circulated by a state authority or central government. Because they are decentralised, cryptocurrencies give people the control over their digital ‘cash’ with no control from governments or any regulatory body.

The news comes at a time when the CBK has issued several warnings to the public and local banks not to deal with cryptocurrencies.

During the session, Rotich dismissed digital currencies terming them as unstable. He used bitcoin’s price drop between 2017 and 2018 to explain the instability of cryptocurrencies. He went on to say that the government is yet to decide on whether cryptocurrency trading will be allowed in the country as it is still a developing technology and that there were ongoing discussions on how to regulate cryptocurrency trade so as to reduce risks such as money laundering globally.

According to BusinessDaily, Rotich concluded by saying: