Nigeria’s Central Bank Bans Cryptocurrency Trading

“Further to earlier regulatory directives on the subject, the bank hereby wishes to remind regulated institutions that dealing in cryptocurrencies or facilitating payments for cryptocurrencies exchange is prohibited.”
Nigeria’s Foreign Exchange Inflow Soars to $23.60bn
Nigeria’s Foreign Exchange Inflow Soars to $23.60bn

The Central Bank of Nigeria (CBN) has directed Deposit Money Banks (DMBs) and other financial institutions to close accounts of persons who are using their systems for cryptocurrency trading.

A cryptocurrency is a virtual or digital currency that appreciates or depreciates on the whims of market forces.

Trading with Bitcoin, a major digital currency, as well as other digital currencies like Ethereum, Ripple, Litecoin, Bitcoin Cash, has gained traction globally and in Nigeria lately, with most young people investing in the cryptocurrency world, buying and selling bitcoin and making a profit for themselves.

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However, the apex bank is clearly not a fan of digital currencies.

In a statement signed by Bello Hassan, Director of Banking Supervision; and Musa JimohDirector of Payments System Management Department, the CBN said: 

“Further to earlier regulatory directives on the subject, the bank hereby wishes to remind regulated institutions that dealing in cryptocurrencies or facilitating payments for cryptocurrencies exchange is prohibited.

“Accordingly, all DMBs, NBFIs and OFIs are directed to identify persons and/or entities transacting in or operating cryptocurrencies exchanges within their systems and ensure that such accounts are closed immediately.”

The CBN also declared that breaches of its directive will attract severe regulatory sanctions.

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It is not the first time that the CBN would be showing its dislike for digital currencies. In 2018, the apex bank issued a circular to say cryptocurrencies are not legal tenders in Nigeria.

“For the avoidance of doubt, dealers and investors in any kind of cryptocurrency in Nigeria are not protected by law. Virtual currencies are traded in exchange platforms that are unregulated, all over the world.

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