The Cameroon Ministry of Finance Demands Crypto Regulations to Guard 900,000 Crypto Users Against Widespread Ponzi Schemes.
The Central African Financial Market Supervisory Commission’s (COSUMAF) failure to issue clear and definitive guidelines on digital tokens and assets has been cited by the Cameroon Ministry of Finance as the cause of the regulatory environment’s uncertainty.
The ministry noticed the prevalence of ponzi schemes in the Cameroonian cryptocurrency ecosystem in a recent study on cryptocurrencies and ponzi schemes.
According to the research, “a large number of businesses are also prospering in offering cryptocurrencies and investment products, some of which follow the PONZI scheme pattern in Cameroon.”
“Without regulation, they draw a sizable clientele thanks to advertising and rewards promises, which, in most cases, lead to the loss of public savings,”
The report claims that Cameroon has a sizable cryptocurrency user base, with roughly 900,000 people taking part, or about 6.76% of its active population. The study found a significant rise in the use of cryptocurrencies, which is mostly linked to how convenient internet transactions were during the COVID-19 outbreak.
The absence of written agreements between users and cryptocurrency exchanges was also considered to be problematic because the businesses could operate freely, possibly jeopardising the interests of users and investors.
According to the study, among the individuals surveyed:
• Only 737 respondents (39.3%) reported receiving a contract, and
• A significant 89% of them indicated that they reviewed the contract before signing it
The study recommends:
• A need for clarifying contract terms and the establishment of regulatory measures aimed at safeguarding investors and ensuring financial stability
• The identification and closure of ponzi schemes
• The formalization of regulations, and
• Increase in public awareness regarding the risks associated with cryptocurrencies.
The study questioned 18 cryptocurrency businesses, most of which were involved in managing bitcoin portfolios, facilitating online cryptocurrency buying and selling, and providing investing advice.
The study questioned 18 cryptocurrency businesses, most of which were involved in managing bitcoin portfolios, facilitating online cryptocurrency buying and selling, and providing investing advice.
The bulk of respondents are in the 20 to 30 age range, and a sizable percentage of them have advanced degrees. The majority of investors make low revenues; just a small percentage make more than 500,000 FCFA ($81) every month.
