Experts discuss cryptocurrencies' impact on monetary policy in Egypt

Leading economists gathered at a seminar hosted by the Egyptian Center for Economic Studies to discuss how digital currencies are reshaping the global financial landscape. They highlighted unprecedented challenges to monetary policy and the need for flexible regulatory frameworks. Speakers emphasized innovation opportunities alongside significant risks.

The Egyptian Center for Economic Studies (ECES) hosted a seminar on May 5, 2026, featuring Harald Uhlig, professor of economics at the University of Chicago; Yehia Aboul Fotouh, deputy chief executive of the National Bank of Egypt; Amr Mostafa, head of treasury and capital markets at the bank; and economic expert Omar El Shenety. The discussion was moderated by Abla Abdel Latif, the centre’s executive director and director of research.

Uhlig offered a global overview, noting Bitcoin trades near $78,000 with projections to reach $521,000 in five years. He highlighted that digital assets are collectively valued at around $2.6trn, and 70% of central banks worldwide are studying central bank digital currencies (CBDCs). He warned that US dollar-pegged stablecoins could pressure central banks' independence.

Aboul Fotouh clarified that cryptocurrencies are legally prohibited in Egypt due to volatility and weak investor protection, asking: “Who would users turn to in cases of fraud or loss?” Mostafa stressed that the future lies with stablecoins and CBDCs for regulatory clarity and trust, while El Shenety observed growing use among youth despite lacking regulation.

Abdel Latif urged the Central Bank of Egypt to take a proactive approach, arguing that waiting for international experiences would leave Egypt behind. The seminar concluded with consensus on a hybrid financial model blending traditional systems with modern technologies, balancing innovation and stability.

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Hassan Abdalla, governor of Egypt's Central Bank, joined the second AlUla Conference for Emerging Market Economies, stressing that the bank's role is not to push the currency up or down but to build a resilient policy framework. He outlined Egypt's economic reform program launched in March 2024, noting inflation's drop from around 40% to nearly 12%. He also highlighted improvements in key economic indicators amid global challenges.

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Egypt's Central Bank Monetary Policy Committee is expected to hold interest rates unchanged at its Thursday meeting, following cuts in December 2025 and February 2026. The decision comes amid rising core inflation and geopolitical risks. Experts describe the hold as the most prudent option to maintain stability.

Ethiopia's National Bank has temporarily restricted digital payment services in applications without its license, including cryptocurrencies. This measure, based on compliance inspections, aims to safeguard financial security. The bank advises individuals to rely on verified information for transactions.

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The Egyptian market is awaiting banks' return to work on Sunday to assess how lenders will adjust interest rates on savings products and loan facilities following the Central Bank of Egypt's decision to cut key rates by 1%. Last Thursday, the CBE’s Monetary Policy Committee reduced its benchmark rates to 19% for overnight deposits and 20% for overnight lending, with the credit and discount rate, as well as the main operation rate, lowered to 19.5%. In a parallel move, the CBE cut the mandatory reserve requirement ratio for banks to 16% from 18% to support liquidity.

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