Morocco has announced plans to legalize cryptocurrencies after banning them in 2017. This major shift will be followed by regulatory framework, designed to ensure safe adoption of digital currencies while mitigating risks. The Bank Al-Maghrib (BAM) confirmed that its framework, developed alongside International Monetary Fund (IMF) and World Bank, aims to address financial innovation and user protection.
Why was Crypto Banned in Morocco in 2017?
The Moroccan government outlawed cryptocurrency transactions in November 2017 due to the rising concerns over illegal activities and potential destabilization of the financial system. Authorities were worried of the anonymous nature of the transactions, which raised concerns of money laundering, tax evasion, and terrorist financing. For this the Ministry of Finance and BAM issued warnings against crypto use, labeling it unreliable as a payment method.
The central bank also argued that cryptocurrency posed a risk to the monetary sovereignty and economic stability. Despite these measures, the ban did not stop the crypto community in Morocco. The public would use peer-to-peer platforms to trade Bitcoin and other digital currencies.
What’s Driving the Reversal?
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Morocco, after having a look at the increased global adoption of digital assets, revisited its own stance. With approximately 1.15 million Moroccans already using crypto via peer-to-peer platforms, authorities understood the need for legalizing the industry by developing a framework that supports growth of the demand and addresses the earlier concerns.
After careful re-evaluation and working closely with international organizations to draft regulations. The Moroccan government aims to provide a platform that is secure, encourages innovation and hence the government has decided to legalize crypto again.
The new pro-crypto reflects Morocco’s ambition to align with global trends and attract investment in the blockchain technology. As the nation transitions to a regulated economy, its success with this industry will act as an example for other countries.
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