Kenya Considers Economy Tokenization

In the latest news, Kenyan DLT and AI task force suggested to tokenize country’s economy in order to deal with “increasing” rates of corruption and some other governmental issues. 

26 September 2018 – Bitange Ndemo, Kenyan Distributed Ledgers and Artificial Intelligence task force Chairman stated that authorities should tokenize the economy. According to local news outlets, Ndemo added that the tokenization of the economy can help in dealing with “increasing” rates of corruption and some other governmental issues. 

Kenyan AI and DLT Task Force

The task force was set up back in March by the Republic of Kenya’s government with the aim to evaluate suggestions on how to utilize Blockchain technology in the public sector. The working group comprises local Blockchain startups, researchers, experts, lawyers, and regulators. 

While speaking at the Information and Communication Technology Ministry (ICT) stakeholders meeting with the private sector, Ndemo highlighted that the government needs to tokenize Kenyan economy. This move, according to the task force leader Ndemo, would allow the government to print less hard currency. He has stated:

 “We must begin to tokenize the economy by giving incentives to young people to do things which they are paid through tokens that can be converted to fiat currency.”

Additionally, Ndemo stated that the adoption of tokens could significantly lower unemployment rates in the country. He highlighted the necessity of issuing a digital currency equivalent to a fiat currency. 

Kenya Cryptocurrency Stance

Jerome Ochieng, the ICT Principal Secretary, stated that the government will create relevant policies in order to process the recommendations suggested by the task force. 

Noteworthy, the Central Bank of Kenya (CBK) released a circular addressed to all the local banks back in April. That time, the bank warned banks against dealing with cryptocurrencies or even engaging with cryptocurrency-related entities. The Governor of the central bank, Patrick Njoroge referred to the cryptocurrency use prevalence in illegal activities. He also cited cryptocurrencies’ anonymous nature and the lack of centralized control as the reasoning for the ban.

Later this June, decentralized liquidity network Bancor established a network of Blockchain-based community currencies. The initiative was aimed at combating poverty in Kenya. The project looks to stimulate local and regional commerce and peer-to-peer activity by allowing Kenyan communities to manage their own tokens.

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