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The government of Zanzibar has launched a National Blockchain Sandbox to foster development in blockchain technology, especially in financial inclusion, identity verification, and minting certificates. The sandbox, established by Dubai tech firm LedgerFi IT and running on the XDC network, will offer government-funded training and incubation programs. This comes amid growing fintech usage in Tanzania, with the Bank of Tanzania outlining regulations for fintech sandboxes. However, the bank has issued warnings against cryptocurrency usage, despite a lack of laws regulating their use.
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The Zanzibar government has just launched a National Blockchain Sandbox to support tech startups, according to local news sources. This sandbox is a tech test field where developers can experiment with groundbreaking technology on the National Blockchain Network. They’re particularly interested in tech that assists in financial inclusion, identity verification, and minting certificates.
Joining this sandbox isn’t just about gaining tech ground. It’s also a chance to receive government-funded training and incubator programmes. Said Seif Said, Director General of Zanzibar’s e-Government Authority, explains that innovators will get the chance to work on pilot projects, receive expert advice and be mentored by leading industry professionals.
The sandbox was put together by LedgerFi IT, a tech company based in Dubai, and will run on the XDC network, which is compatible with EVM (Ethereum’s virtual machine).
In July, the Bank of Tanzania (BOT) prepared a legal setup to harbour fintech sandboxes after working for a year on it. This setup regulates who’s eligible and the application process, and sets a 9-month testing period. There are around 75 fintech startups currently in Tanzania.
The country’s use of financial technology is on the rise. In 2023, it was reported that 72% of Tanzanian adults use mobile money services, as opposed to 22% using commercial bank services. 18.7% of the population was considered as being “financially excluded”.
The BOT, however, cautioned against using or trading in cryptocurrency in 2019, clarifying that Tanzanian shilling is the only legal currency. That said, there aren’t any laws on cryptocurrency use. As of 2023, 1.7% of Tanzanian adults had invested in cryptocurrencies, and 9.7% were aware of them.
However, a report by Tanzanian think tank Governance & Economic Policy Centre noted that Kenya and Tanzania are currently the East African countries with the greatest number of crypto entrepreneurs and transaction volumes. Though, these stats are unofficial.
Zanzibar considered independently adopting cryptocurrency in 2021, separate from the national government, after Tanzania’s President Samia Suluhu Hassan voiced her support for it.
The BOT even considered creating a central bank digital currency but remained “cautious” about it after finishing a research in 2023. They announced that they would carry out a second round of research in June.
Source: Cointelegraph