Parliament of West Africa Economic Block Cautions Against Use of Cryptocurrencies

The parliament of the Economic Community of West African States (ECOWAS) has joined the list of African organizations that have cautioned against the use of cryptocurrencies. In its warning to West Africa crypto users, the legislative body insists these digital assets are too volatile and as such “their use on the African continent is not without dangers.”

Refusing to Accept Crypto Not a Violation of Legal Provisions

According to a report, this parliamentary warning came after the joint committee meeting that was held in Ouagadougou, Burkina Faso. The meeting, according to the report, had been convened to explore “the prospects of cryptocurrencies as a facilitator for investment.”

However, following the meeting that was also attended by “cryptocurrency experts and resource persons,” the joint committee reminded crypto users in the sub-region of the digital currency’s many shortcomings. According to the report, one of the shortcomings of cryptocurrencies is that while they may be used as a medium of exchange, users can still refuse to accept them as payment. Such refusal is currently not seen as a violation or contravention of the relevant laws.

Crypto Volatility

Meanwhile, the joint committee also claimed that cryptocurrencies cannot be likened to e-cash due to their volatile nature. According to the committee, this crypto volatility stems from their “restrictive issuance mechanism that encourages speculation.” Consequently, the ECOWAS Parliament is now urging “crypto enthusiasts to guard against the risk of theft.”

The report also lists other supposed risk factors faced by users of crypto assets. These include the irreversible nature of some crypto transactions, the lack of a central authority that monitors or controls transactions, and the concentration of assets in a few hands.