Morocco considers legalisation of cryptocurrencies as payment currency

Bank Al-Maghrib, the International Monetary Fund and the World Bank are studying how to establish a regulatory framework for this digital money

REUTERS/DADO RUVIC  -   Representation of the cryptocurrency Bitcoin

The Alawi kingdom is studying a new plan to introduce cryptocurrencies in the national market. Right now, there is a legal vacuum on the use of these cybercurrencies, so several institutions are studying how to implement them in the Moroccan economic system. Bank Al-Maghrib (BAM), Morocco's central bank, is working with other European central banks, as well as the International Monetary Fund (IMF) and the World Bank (WB), on a plan to solve this problem.

This was announced by Abdellatif Jouarihi, the head of the Moroccan Central Bank at a press conference. "Given the absence of a legal framework regulating cryptocurrencies at the national and international level, we cannot yet adopt cryptocurrencies," he said. To the issue, he added and assured that this is a matter that is already being addressed, but there is still no signed agreement and no official date to confirm and start implementing cryptocurrencies to the system.

AFP/MANDEL NGAN - International Monetary Fund (IMF) headquarters in Washington, D.C.

"It is a question of when, not if. Cryptocurrencies represent the future," Jouarihi said.

For its part, the BAM is not opposed to starting to adopt this digital system, even confirming that it has been urging the government and other institutions to create the appropriate legislation for some time. In 2021, the Moroccan Central Bank has already created a special board to study how to make this possible and, above all, how it will be adopted in the Moroccan economic landscape.

At the press conference, in addition to talking about the advantages offered by cryptocurrencies, one of the recurring themes and questions to Jouarihi were the drawbacks and risks that their use makes possible. The director confirmed that there is a widespread fear of adopting digital currencies, as they are often used by hackers and thieves to commit cybercrime or even some for money laundering. Jouarihi explained that, in these cases, it is impossible to trace the trail of the crime, as the movements of the money are managed through a decentralised blockchain.
Still, the director assured that any kind of money movement, whether physical, online, on the internet or wherever, also carries its risks and the same crimes occur, so it is not a bad idea to start embracing digital money as well.

Despite the UK's ban on the use of cryptocurrencies, the country is ranked as one of the top places in the world for cryptocurrencies. Earlier this year, analysts and experts already claimed that the North African nation leads the way in Bitcoin use in the north of the continent.

Many portals dedicated to carrying cryptocurrencies, such as Cointelegraph, have already assured that the Alawi kingdom is the number one in this field and that, in addition, it is estimated that 2.4% of Moroccans use and own this virtual money. LocalBitcoins, for its part, confirms that during 2021 historic transfers have been reported and that registrations in this service have increased by more than 30%.

PHOTO/REUTERS - Central Bank of Morocco in Rabat

This same portal also confirms that, from November 2017 to the beginning of 2021, Bitcoin trading volumes on platforms that accept Bitcoin as a payment method have grown by 215%, which ensures that the population is willing to start using it as a payment method. He also adds that these numbers are so high because banning something from the population has the direct consequence that more will follow.

Although its future is not yet known, there are both pro and anti bodies. One of these is the Kingdom's Foreign Exchange Bureau, which stated that "Morocco will not admit a hidden payment system that is not backed by any financial institution". Despite this, many companies have tried to invest in the idea, but the nation's executive has halted any kind of Bitcoin-related project.