Egypt, the country of pharaohs, has relaxed its existing strict rules on cryptocurrencies and digital assets, according to a source speaking to the Middle East News Agency. The state will continue the ban on crypto businesses that do not have a license.

As a Muslim majority nation, Egypt banned all kinds of activities associated with cryptocurrency earlier under Islamic law. Shawki Allam, the Grand Mufti of Egypt (the religious leader) issued the ban in 2018.

Fear of tax evasion, money laundering, and other fraudulent activities that might compromise the legal system made him put the restriction. The Grand Mufti also considered speculation, scams, and volatility associated with crypto going against Islamic ideology. But the situation has changed recently. Crypto market has shown a promising outlook, and the neighboring nations have already started exploring the technology.

Egypt’s recent decision to soften its stance over crypto is undoubtedly the reflection of this realization. The Egypt Independent reported that the bill would give the board of directors of the Central Bank of Egypt (CBE) the sole power to regulate digital assets. However, the license required to do crypto business will be quite expensive.

The report explained:
The law will make a legal authority for all crypto-related banking activity like electronic authentication of bank transactions, electronic pay-orders, transfer orders, electronic settlement of checks, and issuance and circulation of e-checks.

The Board of Directors of CBE will formulate rules and regulations for the activities mentioned above.

The Egyptian government has been discussing crypto regulations for several years but could not find a viable solution before this move. The proposed bill is still at the initial phase and is supposed to be available for public hearing soon.

What can be expected if the law sees the faces of light?

Several Muslim countries declared cryptocurrency as being halal in last April- which means permissible under Islamic laws. Until recently, Egypt remained strict on the crypto ban. But now it will allow traders to operate in the country provided that they obtain a license in advance.

The new draft law has put great emphasis on financial technology. It also advocates the importance of keeping pace with the advancements in the banking sector of other parts of the world and that it is crucial to adopt those to provide smooth and satisfactory banking services.

The Middle East economic giant UAE has already paved the way when it comes to innovation in the past few years. This has led the country to hold the World Blockchain Forum 2020 in Dubai. Being a leading tourist attraction in the world, millions of people visit Egypt every year, and it would be undoubtedly great if they are allowed to pay for goods and services with cryptocurrencies.

The most recent trend of Bitcoin is very positive, with more than 70% price rise in the past two weeks. This bullish trend and several other observations, including the adoption of cryptocurrencies by several countries, and continuous growth of the market despite many challenges are motivating factors for Egypt to soften over digital assets. If the government plan works, the crypto market will see a bunch of wealthy people and firms lining up for business.