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Zambia Shuts Down $2.4M USD Crypto Investment

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Zambia has zero tolerance for cryptocurrencies.

Authorities in Zambia are in the process of shutting down one of the biggest cryptocurrency investment operations in the country. The arrest of three individuals tied to the scheme underscores the country’s tough stance on cryptocurrencies.

Zambia Equalizes Cryptocurrency with Money Laundering

Hilda Agnes Raubenheimer, Orient Rio Zekko, and Tapiwa Chirwa are currently out on bail following their arrest. The trio acted as directors of the investment firm Heritage Coin Resources Limited. Initial reports indicate that the three collected more than $2.4 million USD from investors on the promise they were going to invest in cryptocurrencies.

The three face charges of engaging in money laundering involving cryptocurrencies. According to the charge sheet, the three obtained money by false pretense. Similarly, authorities allege they engaged in a money circulation scheme and operated an unlicensed business.

The Heritage Coin Resource Limited directors face an uphill task to overturn the charges. For starters, the country’s central bank has already ruled that cryptocurrencies are not a legal tender. Therefore, engaging or handling any other form of money amounts to engaging in a form of money laundering.

Cryptocurrencies are not legal tender in the Republic of Zambia; Secondly, BoZ does not oversee, supervise nor regulate the cryptocurrency landscape. Consequently, any and all activities related to the buying, trading or usage of cryptocurrencies are performed at owner’s risk,” the Bank of Zambia said in a press release.

Cryptocurrency Ban

A ban on cryptocurrencies, according to the central bank, seeks to protect members of the public. The agency is also using the ban to maintain the integrity of the country’s financial system. Likewise, the central bank expects the ban to protect people from fraud and hacking incidences.

However, the central bank insists that the ban will not in any way affect innovation. Just like other countries, Zambia maintains a keen interest on the blockchain, the underlying technology that powers cryptocurrencies. The technology has the potential to transform various sectors in the country.

Zimbabwe, just like Zambia, has also issued a total ban on cryptocurrencies. The Reserve Bank of Zimbabwe issued an order barring all financial institutions from supporting cryptocurrencies. The ban came as a surprise given that the country’s embattled financial system could have benefited a great deal from cryptocurrencies.

Countries struggling with economic sanctions as well as turmoil have turned to cryptocurrencies as part of their new monetary policies. Venezuela is one such country that has consequently unveiled a national cryptocurrency to circumvent economic sanctions.

Risk Disclosure

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