Buy Bitcoin Malawi, a local cryptocurrency firm, says digital or virtual currencies commonly known as cryptocurrencies are legal in Malawi and are a crucial investment opportunity.
The firm’s chief executive officer Grey Jabesi, who is based in South Africa, said in a written response that this is contrary to a common perception that cryptocurrencies are illegal and prone to scamming.
But the Reserve Bank of Malawi (RBM) maintains that cryptocurrencies—digital assets designed to work as a medium of exchange that uses strong cryptography to secure financial transactions, control the creation of additional units and verify the transfer of assets—are not legal tender in Malawi.
Jabesi said creating a negative narrative around such modern technology will only discourage Malawians from learning and experimenting with cryptocurrencies which “is extremely bad” for both public and private sector.
In Malawi, the use of digital currency remains unrecognised by RBM despite the digital economy taking centre stage in some circles as a medium of exchange or means of payment.
But Jabesi said most forward-thinking countries and organisations, including the International Monetary Fund, are already adopting such technologies to address many socio-economic issues.
He said Buy Bitcoin Malawi acknowledges efforts by RBM to regulate the new technology, but complained that some of the information being generated in the media is confusing.
Said Jabesi: “We are aware that in 2019, the RBM made it clear that cryptocurrencies are ‘not legal tender’ in Malawi and citizens should deal at their own risk.
“This is a general position for most technology-friendly reserve banks in the world. It is important to note that ‘not legal tender’ does not mean ‘illegal’.
“Legal tender is anything recognised by law as a means to settle a public or private debt or meet a financial obligation, including tax payments, contracts and legal fines or damages.”
In an earlier interview, RBM general counsel and bank secretary George Chioza said Malawi is yet to decide on use of the digital currency.
“At the moment, Malawi is really on the border line. We have not said yes or no, but we know there are cryptocurrencies. Take caution when you are dealing in those currencies,” he said.
On his part, Information Technology Association of Malawi president Bram Fudzulani said in an interview that the country needs cryptocurrencies, adding that there is need for heavy consumer awareness and protection before being fully embraced in Malawi.