BoT: Virtual currencies not authorised in Tanzania

Dar es Salaam. The Bank of Tanzania has reiterated its warning over usage of cryptocurrencies after noting a growing trend in the use of the digital currencies in the country.

The financial sector regulator said in a statement yesterday that trading, marketing and usage of the virtual currencies is against foreign exchange regulations.

“The bank is also aware of incidences where these currencies are being marketed and traded with a perception of making them appear as if they were a legal tender in the country. Moreover, there are some individuals claiming to have engaged the Bank of Tanzania about the use of such virtual currencies.”

“This is to advise members of the public against trading, marketing and usage of virtual currency because doing so is contrary to existing foreign exchange regulations,” said the central bank.

Financial technologies are seen as posing money laundering and terrorism financing threats in the world, according to a statement from the counter-terrorism financing summit held in Manila.

An Indonesia-led study identified some specific risks in new financial technology and provides recommendations to regional authorities to share and collaborate in their efforts to beat terrorists and their financiers.

The Bank of Tanzania, as stipulated in Section 26 and 27 of the Bank of Tanzania Act, 2006, is the sole institution in Tanzania mandated to issue banknotes and coins and to declare a legal tender in the country.

“The Bank of Tanzania, therefore, reiterates that the only acceptable and used legal tender in the country is the Tanzanian Shilling. Other foreign currencies are traded by licensed institutions in the country in line with applicable foreign exchange regulations where the currencies could be issued and redeemed in the country of issuance as a legal tender,” it stated.

The central bank cautioned members of the public to beware of involvement in the virtual currencies, as they are not legally authorized in Tanzania.