Rwanda Reaffirms Crypto Ban After Bybit Adds Franc Support

Rwanda’s central bank has reaffirmed its stance against cryptocurrency activities involving the national currency, following the introduction of support for the Rwandan franc on Bybit’s peer-to-peer marketplace. The regulatory response was prompt and clear, emphasizing that crypto-assets are not authorized for payments, conversions, or peer-to-peer trading involving the franc within the existing framework. The Central Bank of Rwanda cautioned residents against using such services due to financial risks and the lack of legal protection in case of loss.

Bybit’s announcement on Friday allowing users to trade digital assets using the Rwandan franc raised concerns as it was unclear whether the exchange had obtained local regulatory approval for the feature. The exchange has not issued a public response to the central bank’s statement, leaving questions about compliance with local regulations.

Regulators reiterated that the Rwandan franc is the only legal tender in the country, emphasizing that financial institutions under the central bank’s supervision are prohibited from facilitating conversions between the franc and crypto-assets. These restrictions aim to limit exposure between the domestic financial system and digital asset markets.

Rwanda has maintained a restrictive stance on cryptocurrencies since 2018, citing the need to protect financial stability and maintain confidence in the local currency. The recent warning highlights concerns that foreign crypto platforms integrating the franc into trading services could circumvent existing safeguards, potentially creating unregulated channels for transactions.

In parallel, Rwanda is progressing with a state-backed digital currency project, the e-franc, as a means to modernize payment infrastructure and retain control over monetary policy and currency issuance. The project is currently in a proof-of-concept phase, with plans for a pilot phase as it advances.

Regulatory efforts in Rwanda are evolving beyond restrictions, with the Rwanda Capital Market Authority releasing a draft framework in March to establish rules for virtual asset service providers. The proposed licensing regime aims to permit regulated activity while imposing strict limits on cryptocurrency use within the country, including prohibitions on mining operations, mixer services, and tokens linked to the Rwandan franc.

This approach mirrors a global trend among emerging markets seeking to balance innovation with regulatory control over domestic financial systems. While some countries have embraced digital assets, others have opted to restrict their use to prevent capital flight, mitigate volatility risks, and safeguard monetary sovereignty.

Despite lower adoption levels compared to regional peers like Nigeria and South Africa, Rwanda remains vigilant in maintaining oversight as global crypto platforms expand their reach. The limited cryptocurrency activity in the country has so far mitigated potential systemic risks, but regulators are committed to maintaining tight supervision in the evolving landscape of digital assets.