Martin Endjala
The Bank of Namibia (BonN) has announced the granting of provisional authorisations to four entities to provide payment services and virtual asset services.
Provisional authorisation to operate as a virtual asset service provider was granted to Mindex Virtual Asset Exchange (Pty) Ltd. and Landifa Bitcoin Trade CC for a period of six months.
During this period, the companies will set up shop and procure the necessary equipment and software to be able to provide services such as cryptocurrency trading, exchanges, or ATMs.
Kazembire Zemburuka, the central banks’ spokesperson, said the businesses have not been given authorisation to engage the public yet.
“Only after six months do they get final approval. In the meantime, they must hire their people and put infrastructure in place. If they are ready before the six months, the bank can inspect their setup and once approval is granted, they can engage the public,” he said.
The Virtual Assets Act of 2023 has been brought in to minimise issues of money laundering and allow BoN to have oversight over virtual asset services.
Cryptocurrencies are virtual money that can be used to pay for goods, services, cross-border payments and in some countries, salaries as well.
The digital tokens are held in online wallets and can be sent anonymously between users in an instant.
Experts anticipate that Donald Trump’s inaugural speech will reaffirm his support for Bitcoin and the broader crypto industry.
Economic analyst Josef Sheehama says the BoN has taken a positive step by recognising cryptocurrencies and companies that plan to offer virtual asset services in the country.
Cryptocurrency trading is still illegal in Namibia.
By regulating cryptocurrencies in Namibia, Sheehama said the bank is increasing the safety of cryptocurrency activity and attracting new participants.
“Namibia must seize the numerous opportunities this innovative technology offers in order to promote prosperity and economic growth. Because of this revolution, cryptocurrencies are now a significant part of the future of international trade,” he said.
Despite their uniqueness, he believes cryptocurrencies, the technology behind them, and the markets surrounding them can create risks to monetary and financial systems, including financial crime, fraud, and manipulation.
Sheehama commended the bank for achieving a significant milestone by granting a provisional license for payment and virtual asset services in Namibia.
“The world we live in is changing faster than it ever has. Businesses must adjust to their changing customer base and competitive landscape through digital transformation,” he said.
According to Sheehama, this has the potential to spark the fourth industrial revolution, since the majority of these businesses rely on innovation by fusing information technology and finance.
“Today’s world is changing faster than ever before. Companies need to respond to their changing customers and competitive landscape through digital transformation. Businesses need to be agile,” he noted.
Sheehama believes that there is a need for robust public institutions that strengthen democracies and lessen political instability in governments, which are all necessary for Namibia’s digital development.
