Crypto regulation to spur innovation, attract investment

Yellow Card operates in 20 African markets. It holds licenses in South Africa and Botswana. New regulations will provide clarity and boost industry credibility.

Gillian Darko, Chief of Staff at Yellow Card, welcomed the development. She noted that stablecoins and digital assets are now widely used in Ghana. They help manage currency risk and facilitate cross-border payments.

Darko believes these regulations will legitimize an active market. Data shows rising crypto adoption in Ghana. Users increasingly turn to blockchain for remittances and inflation hedging.

Bank of Ghana Governor Johnson Asiama announced plans for regulation by late 2025. This depends on passing a Virtual Asset Service Providers Act. The act would allow the Bank of Ghana to license and supervise VASPs.

A dedicated digital assets unit will enforce the new measures. Dr. Asiama emphasized the need for fast regulation of this technology.

Industry stakeholders are hopeful about positioning Ghana as a digital finance hub. Yellow Card’s Director mentioned that many FinTech companies have prepared for this shift by enhancing compliance protocols.

Regulation is expected to create a stable environment for innovation and growth. A clear legal framework could boost investor confidence and promote responsible practices.

“It creates a level playing field,” said Ms. Darko. Companies with strong anti-money laundering (AML) standards will stand out in a regulated space.

The long-term benefit may include attracting global investment to Ghana. This move echoes the success of Ghana’s Cash-Lite Strategy, which improved financial inclusion.

Yellow Card advocates for key elements in the regulatory framework. These include defined asset classifications and tailored compliance obligations based on firm size.

They also seek mechanisms for ongoing stakeholder engagement, regulatory sandboxes, and research incentives.

Ms. Darko highlighted Yellow Card's rigorous compliance experience from the U.S. and Europe. She stressed the importance of future-proof regulations that are inclusive.

“If done right, Ghana could lead Africa's digital asset ecosystem,” she stated.

The BoG's decision reflects a broader trend across Africa's central banks. They are exploring how to harness digital finance opportunities while managing risks effectively.