Nigeria's central bank CBN has imposed a ban on all commercial banks and regulated financial institutions from providing account services to crypto exchanges.
February 5, 2021 | AtoZ Markets – The Central Bank of Nigeria (CBN) has banned commercial financial institutions from providing services to cryptocurrency exchanges and digital asset companies, according to a circular issued by the CBN on Friday.
CBN orders banks to close accounts of crypto exchanges
This prohibition on crypto trading an extension of earlier warnings from the bank about the risks associated with cryptocurrencies.
As part of the ban on crypto trading in Nigeria, the CBN has ordered all commercial banks in the country to close accounts belonging to crypto exchanges as well as other businesses transacting in digital currencies. According to CBN, failure to comply with the directive will result in severe sanctions.
Cryptocurrencies have been popular in Nigeria. According to Google Trends, Nigeria, with an estimated 206 million people is number one in the world in terms of search interest for Bitcoin.
Back in 2019, the Speaker of Nigeria's House of Representatives, Femi Gbajabiamila called for the adoption of a legal framework for regulating cryptocurrencies.
“On the issue of cryptocurrency, I think blockchain technology is novel and coming up strong. We don’t want to be left behind. […] I think the world is taking the issue of cryptocurrency and block-chain technology seriously. We don’t want to be left behind, and we have to take it seriously,”
In October 2020, Twitter CEO Jack Dorsey urged users to donate bitcoins to support the EndSARS protest. Shortly thereafter, CBN ordered the suspension of bank accounts belonging to EndSARS supporters receiving crypto donations.
Previously, the Nigeria Securities and Exchange Commission (SEC) recognized digital assets as securities "unless proven otherwise."
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