The national bank of Nigeria directs commercial banks to shutter cryptocurrency users’ wallets

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The Nigerian central bank required that all banks shut the accounts of users related to crypto-currency payments on 5 February 2021. 

The Authority also informed banking institutions that it is forbidden to trade in digital currencies or facilitate transactions for cryptocurrency assets. 

In addition, those financial institutions must ‘identify individuals and/or companies’ concerned with payments involving cryptocurrencies or even running digital currency platforms. The Central Bank of Nigeria has also emphasized ensuring that “such accounts are instantly locked.

In a letter sent to the controlled banking firms, the national bank’s banking supervision division released the note. The banking authority quoted in the document an earlier circular from January 2017 warning banks and the public of the dangers related to cryptocurrencies. 

Source: CBN

There was no reference of the explanation for this move in the letter. The note, nevertheless, ended in an alert that serious regulatory penalties will be faced by organizations going against such a regulation. 

Last September, the Nigerian Securities and Exchange Commission had described cryptocurrency as securities and even intended to incorporate an asset legal structure.

In October 2020, cryptocurrency received a rise in acceptance in the wake of demonstrations against police violence a month later. At the point, the government called for the closure of the bank accounts of backers who were involved in the EndSARS campaign. This lead to individuals switching to contributions from Bitcoin and crypto. 

As per statistics from Chainalysis, Nigeria is the eighth largest region in terms of crypto acceptance. In comparison, Google Trends has indicated that when it comes to looking for Bitcoin, Nigeria comes highest.

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