Cryptocurrencies are becoming more and more popular in Ghana. In fact, they are getting more and more popular in pretty much all of Africa. However, there are problems connected to it. The fact that cryptos are decentralized, means that it is extremely hard to control any violations in terms of the law.
So if a citizen gets scammed out of their finances by a fraudulent crypto company, there is extremely little the government can do to compensate these people. Naturally, they wouldn’t be lenient to take the funds out of their budget. The second best option is, of course, to legalize and regulate the cryptocurrency market in the country.
Crypto regulation in Ghana
The fact that the crypto regulation process has already started is commendable. The government is indeed seeing how much cryptocurrencies can affect their population, both positively and negatively. Reports have already flooded in about people being scammed and never seeing their money again. The question is if regulation is going to prevent this.
The answer to that question, in my opinion, is no. The decentralized nature of cryptocurrencies cannot be stopped by just saying no to a company trying to base itself in Ghana. The whole market is digitalized, therefore a company stationed in the USA can still have access to Ghana’s market. So what needs to be done? Financial education.
Providing financial education
The whole system of educating the population in Ghana does not need to be made from scratch. One of the primary sources that the government can use is South Africa. In fact, South Africa has probably the most sophisticated legal framework for providing education and dealing with crypto company licenses. This was due to the fact that their country was ranked as #1 in terms of crypto holder percentage.
The FSCA, which is the South African equivalent of Ghana’s SEC has been taking it as their responsibility to provide information and financial education to the population. Thanks to this initiative, the investors have become a lot more skeptical and were able to avoid further scam companies. So what are the subjects that need to be taught?
- Law & Regulation (In order to determine the company’s legitimacy not only in Ghana but in the world).
- Proper research (Most companies display a plethora of information on their website. Ways to understand that information needs to be taught. Furthermore, the population needs to be given resources to better utilize the SEC’s search mechanisms to determine scam companies).
- Portfolio management (Even if the investor ends up with a scam company, they need to know how much to invest and when. Therefore, in the case of a scam, their losses will be minimal and won’t damage them too much).
All of this can be outsourced. There are not too many crypto specialists in Ghana right now, but there are quite a lot of them in foreign countries. Commissioning a few analysts and professionals is well within the range of the government’s budget.
So in conclusion. It is safe to say that just providing licenses and a regulatory framework is not enough to stabilize the situation.
Giorgi is a news reporter and financial analyst at www.forexnewsnow.com He has 3 years of experience in analyzing the financial markets of Forex and cryptocurrencies. He also likes making hidden jokes in his articles.