CBN says the ban on Cryptocurrency Transaction is a reiteration of its 2017 directiveFebruary 17, 2021
The Central Bank of Nigeria has explained that the reason behind the recent prohibition of cryptocurrency transaction was a reiteration of its 2017 directive stance on cryptocurrencies.
On the 5th of February, the Central Bank of Nigeria issued a press statement where it warned all commercial banks and licensed financial institutions to desist from performing crypto transactions or services to crypto users.
In its Sunday’s statement, the CBN said the Friday’s letter was a reminder that cryptocurrencies is an illegal tender in Nigeria, and was reiterating a stance the bank held since 2017, not imposing new restrictions on the industry.
The press statement, signed by Osita Nwanisobi, Acting Director, Corporate Communications, further mentions other countries that have banned its banks from dealing in cryptocurrencies and claims that in China, “cryptocurrencies are completely banned and all exchanges closed as well.”
While China has enforced several restrictions on crypto exchanges and users, it has not outright banned cryptocurrencies entirely.
It further states that cryptocurrencies are “unregulated and unlicensed” entities, that are used to conduct several illegal activities such as terrorism financing, money laundering, and the purchase of ammunition.
Osita Nwanisobi, reassures Nigerians that the ban will not in any way affect the fintech sector or other payments ecosystem, but the directive is needed to protect youths from losing their funds via crypto transactions.
“In light of these realities and analyses, the CBN has no comfort in cryptocurrencies at this time. It will continue to do all within its regulatory powers to educate Nigerians to desist from its use and protect our financial system from activities of fraudsters and speculators,” the statement said.