Morocco Plans to Lift Crypto Ban with New Regulations

Morocco is preparing to lift its 2017 ban on cryptocurrencies with a new draft law that aims to regulate their use, marking a significant shift in its approach. The initiative, led by the central bank, Bank Al-Maghrib (BAM), seeks to introduce a structured framework for managing cryptocurrencies while also exploring the potential of a Central Bank Digital Currency (CBDC) to enhance financial inclusion.

History of the Ban and Challenges

The initial ban on cryptocurrencies in 2017 stemmed from concerns over their unregulated nature and their association with money laundering and terrorism financing. The Office des Changes, the regulatory body for currency exchange, had warned against virtual currencies, citing their potential for illicit use and risks to consumer safety. Despite this prohibition, underground crypto trading flourished, revealing a gap between policy and practice.

Key Developments in the Draft Law

BAM Governor Abdellatif Jouahri announced that the draft law is now in the adoption process. The proposed regulations aim to strike a balance between enabling innovation and addressing risks such as fraud and financial instability. According to Jouahri, Morocco’s approach reflects lessons learned from global experiences with cryptocurrency regulation.

The law is expected to introduce compliance requirements for exchanges, user verification measures, and possibly a controlled environment for transactions. This aligns with Morocco’s broader financial strategy, which includes modernising payment systems and exploring blockchain technologies.

A Step Towards a Digital Economy

BAM’s interest in a CBDC indicates Morocco’s ambition to align with international trends. Centralised digital currencies, unlike decentralised cryptocurrencies, could offer secure, state-backed digital alternatives for transactions. Jouahri has emphasised their role in achieving public policy goals, particularly financial inclusion.

Looking Ahead

As Morocco progresses towards regulating cryptocurrencies, the country joins a growing list of nations revising their stances. The move could position Morocco as a leader in North Africa’s digital economy, leveraging blockchain and renewable energy for potential Bitcoin mining. However, experts stress the importance of cautious implementation to mitigate risks while fostering economic innovation.

Conclusion

Morocco’s shift from a blanket ban to a regulatory approach reflects its evolving stance on cryptocurrency and blockchain technologies. With the draft law nearing adoption, the country is poised to balance the risks and benefits of this emerging financial ecosystem.