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Kenyan Banks Sent Warning Communications Against Cryptocurrency Transactions

Kenya has recently been added to the list of states opposed to cryptocurrencies.

Through the rumors published by a local newspaper, some Kenyan banks sent warning notices to all those customers who had used credit and debit cards for cryptocurrency purchases on cryptocurrency exchanges.

BitKE, the Kenyan site that first published the news, managed to get hold of the e-mail with which the banks communicated the warning to customers who had carried out transactions related to the world of crypovalues.

Below is an extract from the communication.

“In accordance to Central Bank of Kenya’s circular No. 14 of 2015, virtual currencies such as Bitcoin are not legal tender in Kenya. No protection therefore exists for you as our customer in the event that the platform holding or trading in cryptocurrency fails or goes out of business.

Some of the risks that are associated with holding, buying or trading in virtual currencies include:

  • Transactions in virtual currencies are largely untraceable, making the susceptible to abuse by criminals.
  • Virtual currencies are traded in exchange platforms which are not properly regulated all over the world. Consumers may therefore lose their money without having any legal redress in the event these exchanges collapse or close business.
  • There is no backing of assets, the value of virtual currencies is speculative in nature, and this exposes users to potential losses.

NCBA Bank does not approve cryptocurrency transactions done using your Card or transact with institutions trading in virtual currencies.

Safeguard your finances by not buying, holding or trading in virtual currencies.

If you require more information, please reach out to your Relationship Manager, or our service champions.”

  – NCBA Kenya Bank

Some banks, on the other hand, have not limited themselves to a warning, but have even blocked the financial instruments made available to their customers who had purchased cryptocurrencies. This joint action by many Kenyan banks started after the directive issued by the Central Bank of Kenya (CBK), which ordered local financial institutions to stay away from the world of cryptocurrencies, under penalty of possible sanctions.

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