Ethiopia’s central bank has issued a fresh warning against cryptocurrency-linked transactions, the latest move in what is becoming a broader clampdown on digital financial flows in the country.
On 27 February 2026, the National Bank of Ethiopia (NBE) published a public notice declaring that “Birr-paired peer-to-peer (P2P) arrangements on trading platforms, exchanges, or similar services and products” are not permitted unless explicitly authorised. Any form of Birr-denominated P2P trading or exchange involving cryptocurrencies, the notice added, “is also prohibited.”
The statement, issued from Addis Ababa, frames the restriction as a matter of consumer protection and financial stability. It cites volatility, exposure to foreign exchange manipulation, fraud and scams, operational risks, and the absence of safeguards such as anti-money laundering and counter-terrorism financing protections typically found in regulated financial systems. Until a comprehensive regulatory framework is formally introduced, the bank said, Birr-paired P2P cryptocurrency transactions remain prohibited.
The notice lands amid a widening enforcement campaign that stretches beyond crypto exchanges.
Betting, fintech and capital flight
In November last year, the National Intelligence and Security Service (NISS) — an agency more commonly associated with counter-terrorism and regional security — announced the detention of 24 individuals over what it described as a sophisticated financial scheme linked to sports-betting platforms.
According to the agency, the group orchestrated a system that moved more than 100bn Birr (approximately $730m at prevailing unofficial rates) beyond the reach of authorities. Investigators alleged that sports-betting operators, working alongside licensed domestic fintech providers, channelled local betting proceeds through payment aggregators before converting funds into foreign currency via cryptocurrency platforms and informal international transfer networks.
When authorities attempted to intervene, NISS said several licensed operators had vacated their registered premises. Remaining service providers reportedly cited client confidentiality in response to questions about transaction flows — a defence the agency dismissed.
The allegations have not yet been tested in open court, and the detained individuals have not publicly responded. But the message to Ethiopia’s licensed fintech sector is clear: financial intermediaries are now expected to take a more active compliance role in monitoring digital and cross-border flows.
A currency under pressure
The tightening stance comes as the NBE seeks to stabilise the Birr amid persistent foreign-exchange shortages. A gap between the official exchange rate and the parallel market has created strong incentives for arbitrage. Where spreads widen, informal markets tend to expand — and digital rails, including crypto platforms and offshore payment channels, can accelerate that process.
In its February notice, the central bank acknowledged growing global interest in digital and virtual assets but emphasised the risks of users losing access to funds when platforms face financial or technical challenges. “Recent international experiences,” it noted, show that some P2P platforms and crypto exchanges have restricted withdrawals, underlining the need for caution.
The NBE said it is working on a comprehensive regulatory framework that would enable “safe and orderly participation in emerging digital asset technologies,” in consultation with international peer regulators and domestic stakeholders. Until then, the prohibition stands.
Reform agenda meets enforcement reality
The clampdown sits uneasily alongside Ethiopia’s broader economic reform ambitions. Under the government’s Homegrown Economic Reform Agenda, policymakers have pledged gradual liberalisation, including financial sector modernisation and digitalisation.
Mobile money services such as Telebirr have expanded domestic digital payments, and Ethiopia has opened parts of its telecom and financial markets to new entrants in recent years. Yet cross-border payments and foreign-exchange management remain tightly controlled.
Authorities argue that unchecked crypto-linked trading and informal remittance channels risk undermining monetary policy and draining scarce hard currency. Industry participants, however, warn that blanket prohibitions may push activity further underground, complicating oversight rather than strengthening it.
For now, Ethiopia’s approach reflects a defensive posture. By formally outlawing Birr-paired P2P crypto trading and pursuing enforcement actions linked to betting and fintech intermediaries, regulators are signalling that digital finance will be tolerated only within clearly defined — and tightly supervised — boundaries.
Whether the promised regulatory framework eventually integrates digital assets into the formal system, or continues to prioritise restriction over accommodation, will shape the trajectory of Ethiopia’s tech ecosystem in the years ahead.