Morocco’s Evolving Approach to Crypto Assets Regulation

The crypto asset landscape in Morocco has experienced significant growth, with the ownership of digital assets increasing from 2.4% to 3.1% between 2021 and 2022. This growth has occurred despite nationwide bans on trading and possessing crypto assets, which were implemented in 2017. However, recent developments suggest a shift in the regulatory approach towards crypto assets in Morocco.

A Change in Perspective

In December 2022, the Central Bank of Morocco (Bank Al-Maghrib or BAM) made a groundbreaking announcement that indicated a willingness to embrace crypto assets within the country. The Governor of BAM, Abdellatif Jouahri, conveyed the central bank’s intention not to stifle innovation while protecting citizens from the risks associated with the crypto asset field. This announcement marked a significant departure from the previous ban on crypto assets.

Moroccan crypto enthusiasts welcomed this change in stance, as they have long believed in the economic potential of crypto assets despite the stringent bans. The central bank’s commitment to regulating crypto assets was seen as a positive step that could benefit both individuals and businesses involved in crypto asset transactions.

The Road to Regulation

Morocco’s journey towards embracing crypto assets began in 2017 when the country imposed a ban on the holding and trading of digital assets and virtual currencies. This move was a response to the rapid growth of the crypto asset market. However, as the global crypto asset industry continued to evolve, the Moroccan central bank recognized the need to revisit its stance.

Over the past year, BAM engaged in several discussions with various regulatory bodies, including the Insurance Supervisory Authority and Social Security (ACAPS), the International Monetary Fund (IMF), and the World Bank. These consultations aimed to develop a regulatory framework for crypto assets tailored to the Moroccan context.

The Draft Crypto Asset Law

In July, BAM announced that it had begun drafting a crypto asset bill that would provide a definition of crypto assets adapted to the Moroccan context. The primary objective of this legislation is to protect individuals while fostering innovation. While specific details of the bill have not been disclosed, it is expected to be less restrictive than the current legislation, which outrightly bans crypto asset trading.

The central bank’s collaboration with international organizations and its consultations with various stakeholders have contributed to the development of this draft law. BAM has expressed confidence in the readiness of the project and is actively engaging with multiple parties to ensure a comprehensive understanding and implementation of the new regulatory framework.

The Role of Blockchain in Morocco

Despite the ban on crypto asset trading, Morocco has not refrained from exploring the potential of blockchain technology. In 2020, Soluna deployed the first blockchain-powered wind farm in Dakhla, one of Morocco’s windiest regions. This renewable energy source powers crypto asset mining operations, demonstrating the country’s interest in blockchain technology.

Conclusion

Morocco’s evolving approach to crypto asset regulation reflects a changing perspective on the role of digital assets in the country’s economy. While the ban on crypto asset trading was enforced in 2017, the recent announcements from the central bank signify a willingness to explore regulatory frameworks that balance innovation and risk mitigation.

As Morocco prepares to introduce its crypto asset law, it is expected to provide a more accommodating environment for crypto asset enthusiasts and businesses. The changing landscape indicates that Morocco is keen to harness the economic potential of crypto assets while ensuring the safety and protection of its citizens.

In the midst of global crypto asset trends, Morocco’s journey towards crypto asset regulation serves as an example of how governments are adapting to this transformative technology. The crypto asset market in Morocco is poised for significant changes, and stakeholders will closely monitor the implementation of the forthcoming regulatory framework.