Tue. May 18th, 2021

New Block chain Association to fight crypto currency scammers

Research and markets from US says cryptocurrency and blockchain technology market will grow by 35.2per cent with an aggregate of $42.16 billion by 2022. The growth is expected to take place in US, followed by Europe and Asia-Pacific and India.

Early this year, the Central Bank took a whip unto the crypto currency, the flourishing digital currency that had taken the country by surprise. In fact, most people had fallen prey to scammers who had taken the advantage of the unregulated yet lucrative business.

Experts say that Crypto currencies are by passing the established money system which means if not controlled as it further gains popularity, they may render the system obsolete and so complicate the conduct of monetary policy.

With its nature which is not within the controlled currency environs of the Central Bank, the virtual currency had become prone to scammers who were extorting money from unsuspecting people while also causing currency uncertainties in economy.

 “There is no regulatory body that regulates how crypto currency is made and transacted, which attracts scammers and money launderers,” John Rwangombwa, Governor Central Bank had earlier said.

According to Central bank, a crypto currency is a digital or virtual currency or money that uses cryptography, a process of changing legible information into a code, making it impossible to track any transfers or purchases.

The  currency, although  not yet a big issue in  Rwanda is picking pace at a higher rate, which  requires regulation as experts put it, arguing that scammers will still exist.

 “Every technology is abused, internet was once abused, it is the same thing with block chain; it is inevitable our role as block chain community is to educate as many people as possible about  scammers and real block chain,”  said Norbert  Haguma, co- founder block chain Rwanda.

 As a result, players within the block chain have opted to set up an association that will be overseeing the subsector expected to expand further given the well established technology infrastructure in the country.

“With the association we are trying to form, we hope to bring as many partners as possible, because at the end, when we work together we go far,” said Eugene Desire Nzengu, one of the initiators of the block chain Rwanda Association.

For those who lost money in the recent scam still believe they can invest more if the blochain community is regulated.

“I know the problem is not block chain it is the bad people who come in to steal us, if Government regulates, am willing to invest more,”  said Alphonse Ntakirutimana.

One of the Blockchain Association’s key focus is to create awareness while also educating people who are involved in the business. “We need people who are educated about these matters, Nzengu says, “you don’t need to have Bachelors degree or masters, information is everywhere,” he adds

Like the Forex Bureau association which alienated the black market dealers, the association is expected to streamline Block chain and emphasise professionalism within the community- something that is likely to enforce efficient regulation of the market currently decentralised.

 “The problem we had in Rwanda was that we had many scammers who would say, we have a coin like bitcoin but you can buy from us alone; if I buy a coin from one person then that is not crypto currency,” Haguma explains.

He says, “A crypto currency is supposed to go on exchange and be exchangeable between other people because it is decentralised.

Nevertheless, Government, although not yet officially confirmed is in plans of making its own crypto currency-Rwanda Coin which will be regulated by Central Bank.

“The Rwanda coin will have value as of a Rwanda franc, the currency will be backed up by national currency, that’s our concept has not yet been approved,” said Violet Mahoro, Rwanda Coin Project.

According to the September 2017 Bank of International Settlements report, it was highlighted that Central Banks should introduce their own crypto currencies to counter the risks from the explosive growth in bitcoin and other virtual currencies.

As a result, more tech firms such as bit2Big Ltd, a Globe solutions provider in crypto currency are coming up with solutions to facilitate  the transaction of the crypto currency  with  the point of sales  devices.

“There is no doubt that blockchain-based solutions can leapfrog traditional, on-existent technology infrastructures in Africa considering the range of applications being implemented, from enabling micropayment systems to digital identity management to smart contracts,” Said Michael Kiberu Nagenda, Chief Executive Officer,BIT2BIG.

He says that, “Blockchain is of particular relevance to African economies as it steers inclusive growth where ‘no one is left behind’ and enhance transparency and reduce long-standing inefficiencies and costs within multiple sectors.”

About crypto currency

Through a process known as mining, a any person can crate Units of crypto currency and it involves computer power to solve complicated maths problems which generate coins. Alternatively, users can buy currencies from brokers online, store and spend them using cryptographic wallets.

Crypto currencies use block chain technology or distributed ledger technology (DLT).This allows users to make payments as well as store money without the need to  use the  normal  banking procedures. In most cases, there is no centralized infrastructure or intermediaries exist in crypto currencies like in electronic representations where there is always a trusted intermediary.

The crypto currency differ from the normal currency in that crypto currency is not a liability for anyone, they are issued and controlled by developers not central banks and feature peer to peer exchange.

Quick points about crypto currency

Bitcoin was the first crypto currency which was launched by anonymous group or individual in 2009 using the pseudonym Satoshi Nakamoto.

By September 2015, there were over 14.6 million bitcoins in circulation commanding a total market value of $3.4 billion.

As of Now, Bloomberg puts the value of 20 biggest crypto currencies to around $150 billion wth more than 900 crypto currencies available.

The most common crypto currencies are; bit coin- the leading with a market  capitalisation of  $45 billion as of July 2017,Ethereum-Developed in 2015 has $18bn, Ripple founded in 2012( used by banks across the globe) has $6.3 billion while Litecoin, of the same  nature with bitcoin  has $2.1 billion.

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