Following a meeting with experts to advise them on the use of cryptocurrencies, the body’s legislative committee produced a report which laid out the benefits of adopting cryptocurrencies.
On the other hand, the committee also highlighted challenges that make cryptocurrencies unfavorable for use at the moment until proper regulation is in place.
The report noted that the recent decline in prices of cryptocurrencies was an indication that they are not safe haven assets.
Another issue the joint committee raised was that people and sub-regions can decide to reject cryptocurrencies as payment, since they are not backed by law.
Other issues that were raised include:
The concentration of crypto on a few hands
The irreversible nature of some transactions
The lack of a central regulatory authority
Anti-terrorism and anti-money laundering concerns
In regards to regulation however, ECOWAS admonished the member states saying:
“Concerning the regulation of cryptocurrencies, Mr. Apraku recommended that central banks, ECOWAS Member States, national commissions in charge of stock exchange transactions and the private sector champion the development of appropriate regulations and codes of conduct for the operation of cryptocurrency in the ECOWAS region.”
According to Kofi Apraku, Commissioner, ECOWAS:
“Once acceptable regulatory measures are developed and enforced, several benefits would accrue to the region from the use of cryptocurrency.
These benefits would include:
* Fast-tracking the regional payment system
* The establishment of the ECOWAS Central Bank
* boosting remittance to ECOWAS Member States
* The increasing gross capital inflows to the region
* Improving intra-regional and international trade.”
– Commissioner, ECOWAS
People in West African countries are some of the most enthusiastic about crypto, with Nigeria in particular a world leader in crypto adoption. People in the region are exploiting crypto to sidestep tough capital controls, other than the opportunity for financial gain.