Cryptocurrency In Nigeria: Laws And Regulations Of Investing In Cryptocurrency

Nigeria is seen as the leading country in Africa with the mass adoption of cryptocurrency. Nigerian citizens are more interested in crypto trading and investment and the government hasn't come up with any ideas for regulation, besides giving laws through its Apex bank that restricted financial institutions such as banks and fintech companies from facilitating crypto transactions in early 2021.

Without further ado, let's quickly dive into how Nigeria is trying to shape crypto trading and investment. Note that currently, Nigerians can't trade p2p on Binance due to the issue the government has with Binance which they are blaming Binance for Nigeria's speculation.

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Is Crypto Trading/Investment Legal or Allowed in Nigeria

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Well at the moment the way it is in most countries is the way it is in Nigeria. Here in Nigeria, crypto trading and investment are not considered legal tender yet in the country, and they are not banned. Since it is not yet made a legal tender officially doesn't mean they are banned. In Nigeria, the government has never come up with any specific laws stopping its citizens from trading or investing in cryptocurrency.

Because there have never been any laws or regulations stopping Nigerians from Investing, trading, or using cryptocurrency, Nigeria is among the top highest country that has embraced the usage of cryptocurrency in the world and we are expecting the crypto market to experience further growth in 2024.

From the information obtained from Chainalysis, it shows that Nigeria is the second leading country in crypto adoption as of 2023 Nigeria is extremely still rising fast in the adoption of cryptocurrency.

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2024 Crypto Trading/Investment Rules and Regulations in Nigeria

In this year 2024, we haven't heard from the government on crypto restrictions besides the issue the government has with Binance exchange. Fast forward to the end of 2023, the Central Bank of Nigeria (CBN) overturned the 2021 ban on the restriction of financial institutions and fintech companies facilitating crypto transactions and opened the door for a more friendly transaction which is a call for regulations.

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Based on the upliftment of the 2021 ban on cryptocurrency it now means that institutions are allowed (permitted) to help facilitate crypto transactions for customers as provided the customer adheres to the anti-money laundering check (AML) and Know Your Customer (KYC) policies. This gives rise to all crypto exchanges and wallets operating in Nigeria to ascertain the following information for themselves and their customers.

• Exchange must obtain a license from the Security and Exchange Commission (SEC) and register with the Corporate Affairs Commission (CAC)

• Exchange must have a minimum paid-up capital it ₦500,000,000 which is equivalent to $409,836.066.

• Exchange must collect bank verification numbers (BVN) from their customers.

• Exchange must verify the identity of their customers and report any suspicious transaction carried out by any customer to comply with AML and KYC measures.

• Exchange must submit a white paper to SEC for approval and have a physical office in Nigeria to ensure that the exchanges are operating within the rules and regulations of the government to help support Nigeria's economy and create more jobs.

With these new regulations in Nigeria, it is for all crypto and blockchain companies operating in Nigeria to focus more on data protection, and privacy, and shun money laundering which exchange needs to know their customers and checkmate their activities very well. _{Coming to the end of this post, cryptocurrency isn't banned in Nigeria and it hasn't been fully regulated.}

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