Crypto exchange in Ethiopia offered new registration program
Ethiopian authorities are now requiring all crypto businesses to register with the Information Network Security Administration (INSA) in ten days.
The crypto registration scheme was made possible by amending a law that gave INSA the power to oversee cryptographic products and transactions.
The initiative comes as Ethiopia looks for a legal framework to deal with the growing interest in cryptocurrency mining and investment, sectors once banned by the National Bank of Ethiopia (NBE).
The governor of the NBE told CGTN news in June 2022 that the central bank’s rules and regulations only recognize paper money and that there will be legal consequences for people who trade in cryptocurrency. He added that the bank would conduct further studies.
Ethiopia wants to make a mark in the cyber security space
Companies that operate without registering with INSA will be prosecuted. INSA claimed to have thwarted 97% of cyber attacks against the country since July 2021, saving Ethiopia approximately $26 million. Through its registration scheme, Ethiopia wants to be the first African country to offer investors protection from criminal crypto businesses from a cyber security perspective.
Ethiopia is behind Kenya, South Africa, Egypt and Nigeria with 1.8 million crypto holders. High black market prices for the scarce US dollar encouraged crypto adoption through nine local exchanges in Ethiopia.
Cryptocurrency exchanges can become the target of cyber security hacks as they process and hold large volumes of digital assets. The most infamous example is the multi-million dollar hack of a Japanese crypto exchange Mt. Gox in 2014. In December 2021, hackers took $200 million from Bitmart, another trading platform.
A hacker can target a victim by offering to double their money after they make an initial investment. The hacker could then make off with his cryptocurrency, leaving the investor to keep the bag.
Attackers can also use keyloggers or other malicious programs to trick people into revealing personal information and then sell it on the dark web for small amounts of cryptocurrency.
Uganda clings on, CAR headed for trouble
Between October 2019 and February 2020, five cryptocurrency companies in Uganda closed their doors, taking $26 million in customer funds with them. In February 2021, the Ugandan parliament criminalized Ponzi schemes that cost investors $2.7 million and penalized payment providers that made crypto transactions possible.
The Central African Republic’s recent adoption of bitcoin as legal tender has been criticized by experts who warn that it could have opened the country up to financial crime. An expert believes that bitcoin makes illegal transactions possible for the Wagner group, a Russian paramilitary organization fighting for the country’s sovereignty.
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