CRYPTOCURRENCY BANNED IN NIGERIA

The Central Bank of Nigeria, in a press release dated, the 7th of February 2021 has explained in detail the reason for its directive to Deposit Money Banks (DMBs) and other financial institutions to desist from transacting in and with entities dealing in cryptocurrencies.

Issuing a press statement, the CBN said it felt the need to provide further justifications about its position to the general public.
The press statement began with the CBN detailing the nature of cryptocurrencies stating that “Cryptography is a method of encrypting and hiding codes that prevent oversight, accountability, and regulation. While there are a number of cryptocurrencies now in circulation, Bitcoin was the first to be introduced in 2009, and now accounts for about 68 percent of all cryptocurrencies.”
Even though the circular of February 5 has sparked a lot of reactions, the CBN makes it known that its recent restriction is not new, but only a reminder of the earlier circular that was dated January 2017.
As regards our recent policy pronouncement, it is important to clarify that the CBN circular of February 5, 2021, did not place any new restrictions on cryptocurrencies, given that all banks in the country had earlier been forbidden, through CBN’s circular dated January 12, 2017, not to use, hold, trade and/or transact in cryptocurrencies,” it stated.

The apex bank further stated that the prohibition of cryptos was not exclusive to Nigeria, as certain levels of restrictions on financial institutions facilitating crypto transactions have been applied in several other countries around the world.