Bitcoin, cryptocurrencies illegal in Ethiopia, says central bank

The use of Bitcoin and other digital currencies for transactions is illegal in Ethiopia, the country's central bank said on Monday, warning that violators will face strict action.

The National Bank of Ethiopia (NBE) said it will take "legal measures" against anyone found to be using cryptocurrencies for transactions in the country.

"Birr is the only legal currency in Ethiopia and all financial transactions shall be effected through it," read a NBE statement.

According to the central bank, studies have found that people are widely using Bitcoin and other cryptocurrencies in Ethiopia.

"A huge amount of financial transactions are taking place via these virtual currencies," the statement said.

"Transactions via virtual currencies have also helped the transfer of illegally earned money, increasing money laundering."

The NBE stressed that there is still no officially recognized cryptocurrency exchange in Ethiopia.

"We will be taking legal measures against anyone involved in transactions of cryptocurrencies," the bank warned.