CBN lifts ban on cryptocurrency transactions
The Central Bank of Nigeria (CBN) has lifted the ban it imposed two years ago on cryptocurrency transactions in the Nigerian banking system.
The CBN announced the reversal of the policy in a circular by Haruna Mustapha, its director in charge of financial policy and regulation.
Mr Mustapha said the apex bank would now provide regulations for financial institutions on how to manage cryptocurrency to avoid misuse.
The News Agency of Nigeria (NAN) recalls that the CBN issued a circular in February 2021 restricting banks and other financial institutions from operating accounts for cryptocurrency service providers.
The then CBN Governor, Godwin Emefiele, had announced that the restriction was necessary in view of the money laundering and terrorism financing risks posed by cryptocurrency.
Mr Emefiele also said the vulnerability inherent in cryptocurrency operations, as well as the absence of regulation and consumer protection measures were also responsible for the policy.
According to Mr Mustapha, current global trends have shown that there is need to regulate the activities of Virtual Assets Service Providers (VASPs) which include cryptocurrencies and crypto assets.
ALSO READ: U.S. govt trains 50 Nigerian investigators to combat cryptocurrency fraud
“Following this development, the Financial Action Task Force (FATF) also updated its recommendation to require VASPs to be regulated, to prevent misuse of virtual assets.
“In view of the foregoing, the CBN hereby issues this guidelines to provide guidiance to financial institutions under its regulatory purview in respect of their relationship with VASPs in Nigeria.
“The guidelines supersedes the CBN circular of Feb. 5, 2021on the subject,” the director said.
He, however, warned that banks and other financial institutions were still prohibited from holding, trading or transacting in cryptocurrencies on their own account. (NAN)
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The Central Bank of Nigeria (CBN) has lifted the ban it imposed two years ago on cryptocurrency transactions in the Nigerian banking system.
The CBN announced the reversal of the policy in a circular by Haruna Mustapha, its director in charge of financial policy and regulation.
Mr Mustapha said the apex bank would now provide regulations for financial institutions on how to manage cryptocurrency to avoid misuse.
The News Agency of Nigeria (NAN) recalls that the CBN issued a circular in February 2021 restricting banks and other financial institutions from operating accounts for cryptocurrency service providers.
The then CBN Governor, Godwin Emefiele, had announced that the restriction was necessary in view of the money laundering and terrorism financing risks posed by cryptocurrency.
Mr Emefiele also said the vulnerability inherent in cryptocurrency operations, as well as the absence of regulation and consumer protection measures were also responsible for the policy.
According to Mr Mustapha, current global trends have shown that there is need to regulate the activities of Virtual Assets Service Providers (VASPs) which include cryptocurrencies and crypto assets.
ALSO READ: U.S. govt trains 50 Nigerian investigators to combat cryptocurrency fraud
“Following this development, the Financial Action Task Force (FATF) also updated its recommendation to require VASPs to be regulated, to prevent misuse of virtual assets.
“In view of the foregoing, the CBN hereby issues this guidelines to provide guidiance to financial institutions under its regulatory purview in respect of their relationship with VASPs in Nigeria.
“The guidelines supersedes the CBN circular of Feb. 5, 2021on the subject,” the director said.
He, however, warned that banks and other financial institutions were still prohibited from holding, trading or transacting in cryptocurrencies on their own account. (NAN)
Support PREMIUM TIMES’ journalism of integrity and credibility
Good journalism costs a lot of money. Yet only good journalism can ensure the possibility of a good society, an accountable democracy, and a transparent government.
For continued free access to the best investigative journalism in the country we ask you to consider making a modest support to this noble endeavour.
By contributing to PREMIUM TIMES, you are helping to sustain a journalism of relevance and ensuring it remains free and available to all.
Donate
TEXT AD: Call Willie – +2348098788999
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