By John Walubengo
It has been a while since we talked about cryptocurrency—or cryptos, as they are widely known. It is high time we reviewed the crypto landscape, especially after the Worldcoin saga in 2023 and the current bullish run of Bitcoin.
But first, the basics – what is a cryptocurrency?
In its simplest description, a cryptocurrency is a digital currency operating outside the control of traditional banking and government systems.
That’s the core idea behind crypto. Transactions are secured through cryptography, a complex system of computer-generated codes, and recorded on a distributed ledger called blockchain, a transparent and tamper-proof public database.
The first cryptocurrency, Bitcoin, was launched in 2009 after the 2008 world economic crisis. Its main intention was to be independent of government control.
The creator or creators going by the pen name ‘Satoshi Nakamoto’ mined the first Bitcoin literally from thin air using a very elaborate and scientifically proven methodology defined in the seminal academic computer science paper titled ‘Bitcoin:- a Peer to Peer Electronic Cash System.’
Since then, there have been many variations and mutations of similarly created cryptos – most designed to scam innocent and vulnerable wannabe billionaires.
Bitcoin – the gold standard
However, Bitcoin and perhaps one more – Ethereum Blockchain and their associated cryptos- remain true to their origins and continue to hum along just fine.
This has led even the very cautious US Securities Exchange Commission (SEC) to make some approvals regarding Bitcoin-traded assets in a landmark decision made early this year.
Within the African region, we saw some countries like Nigeria enter crypto with a Central Bank-mandated digital currency, e-Naira.
Commonly known as the Central Bank Digital Currency (CBDC), it aims to leverage the benefits of cryptos while retaining the regulatory control that governments currently enjoy over their fiat money.
In Kenya, the Central Bank did a public consultation over the possibility of launching a similar CBDC for Kenya but concluded that such a venture was optional.
Virtual Asset Bill
Meanwhile, the Blockchain Association of Kenya has continued endeavouring to have cryptos legally recognized by Kenyan law and recently put together a draft Virtual Asset Bill that the Parliamentary Committee of Finance is currently reviewing.
The crypto industry, locally and globally, is undergoing significant changes worth noting for both the sceptics and the die-hard believers in the crypto agenda.
Whichever side of the crypto debate you fancy – this conversation will not go away anytime soon. So, you might as well get involved one way or the other.
RELATED
- What is The Difference Between Blockchain, Cryptocurrency and Crypto-exchanges?
- Worldcoin Project: A Case for Regulatory Sandbox in Kenya Their Role and Opportunities
John Walubengo is an ICT Lecturer and Consultant. @jwalu.
