The National Bank of Rwanda and Capital Market Authority propose a regulatory framework for virtual assets aiming to govern digital transactions, mitigate risks, and ensure compliance. The law introduces licensing requirements while addressing concerns related to financial crimes, providing clearer guidelines for both buyers and sellers in the virtual asset market.
The National Bank of Rwanda (NBR) and the Capital Market Authority (CMA) have proposed a draft regulatory framework designed to oversee virtual assets and service providers in Rwanda. This strategic move aims to enhance governance over digital financial transactions, defining virtual assets as digital forms of value potentially used for trading, payments, and investments, including those secured on blockchain technologies.
This regulatory proposition aims to stimulate innovation while addressing risks, such as money laundering and terrorist financing, associated with virtual assets. Carine Twiringiyimana, from the CMA, highlighted that the Financial Action Task Force has expressed concerns regarding misuse of virtual assets for laundering. To counter this, the regulations will clarify guidelines for the general public and service providers.
The draft law, made public on March 6, seeks public feedback to ensure transparency. In addition to cryptocurrencies, the regulations also cover tokenisation of physical assets, stressing that using tokens to represent the Rwandan currency is prohibited to avoid manipulation. The framework intends to create a secure and transparent operational environment for all forms of virtual assets.
With the proposed regulations, buyers will benefit from legal assurances regarding transactions, as sellers will be bound to deliver the correct assets as agreed. Under Article 8, entities wishing to engage in virtual asset services must apply for a licensing indicating that the CMA will establish licensing requirements.
Market participants, particularly cryptocurrency traders like Gaspard Nsekambabaye, welcome the regulatory approach. He noted that the framework would safeguard buyers against scams. Given the prevalence of fraudulent schemes, regulation could ensure that sellers are registered, thereby protecting the interests of buyers.
Additionally, those affected by fraudulent transactions are directed to seek help from the Rwanda Investigation Bureau (RIB), which addresses financial crime, including issues arising in virtual asset trading. The legal clarity afforded by the new regulations aims to promote transparent trading practices.
In summation, the National Bank of Rwanda and the Capital Market Authority’s proposed draft law on virtual assets is a significant step towards regulating digital financial transactions. By establishing clear guidelines and licensing processes, the framework seeks to deter risks associated with financial crimes while enabling innovation in the sector. Stakeholders from the crypto trading community express optimism that these regulations will enhance security and protect buyers from fraud.
Original Source: www.newtimes.co.rw
