Nigeria: CBN Fines Commercial Banks for Cryptocurrency Activities

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The Central Bank of Nigeria has sanctioned commercial banks for non-compliance with the restrictions on cryptocurrencies transactions. In February 2021, the Central Bank placed a ban on individual and business users of cryptocurrencies from trading through Nigerian banks. Three major banks in Nigeria have been fined for failing to comply with the directive.

Access Bank was fined 500 million naira for failing to close accounts used to fund and trade cryptocurrencies while UBA was fined 100 million naira for a transaction carried out through its operations. The same is the same for Stanbic IBTC Bank, the domestic bank of Africa’s largest lender by assets – the Standard Bank Group- was fined 200 million naira for cryptocurrency activities on two customer accounts.

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The sanctions are part of CBN’s attempts to prohibit the use of cryptocurrency which several Nigerians have embraced in recent times. In the circular that made it illegal for banks to participate in the digital currency space, the apex bank stated that it was prohibited for regulated financial institutions to deal in cryptocurrencies or facilitate payments for cryptocurrency exchanges.

The statement at the time read: “The attention of banks and other financial institutions is hereby drawn to the above risks and you are required to take the following actions pending substantive regulation or decision by the CBN.

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

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

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