Nigeria’s central bank orders closure of crypto-related accounts

by Gordon James

The Central Bank of Nigeria has ordered all banks to close accounts related to cryptocurrency. This includes virtual currency accounts, exchanges, and payment processing services. The decision comes as the bank is working on its own digital currency called e-Nigeria which will be pegged 1:1 with the naira

In a surprising move, Nigeria’s central bank ordered the closure of all crypto-related accounts in order to avoid money laundering and financial crimes. What does this mean for investors?Nigeria’s central bank has ordered the closure of all crypto-related accounts, amid a crackdown on digital currencies. The move comes after the country’s financial watchdog said it had found “widespread” use of Bitcoin and other cryptocurrencies in Nigeria, with some Nigerians using them to launder money. Read more in detail here: is cryptocurrency legal.

Nigeria’s central bank (CBN) has maintained its anti-crypto asset stance, ordering financial institutions in the nation to cancel the accounts of anyone suspected of trading cryptocurrencies.

Banks have been ordered by the CBN to terminate crypto trading accounts.

The CBN issued a circular on November 3 signed by its director of banking supervision, J.Y. Mammanand, asking commercial banks to cancel the accounts of TVS Hallmark Service Limited, Nnamdi Francis Okereke, and Nwaorgu Kingsley Chibuzor due to their involvement in cryptocurrency trading.

The CBN circular states that banks “are hereby directed to close accounts of the under listed bank customers and place the funds in suspense accounts for engaging in cryptocurrency trading in contravention of CBN Circular BSD/DIR/PUB/014/001 dated February 5, 2021,” according to Peoples Gazette, a local media outlet in the country.

You may remember that the Nigerian central bank ordered all financial institutions operating within its jurisdiction to cease providing services for cryptocurrency transactions or face fines. Despite the restriction, Nigerians continue to be among the world’s top crypto adopters.

A mail seen by this reporter from one of the country’s commercial banks confirmed the central bank’s resolve to sanction defaulters, instructing employees to “identify persons/entities transacting in or operating cryptocurrency exchanges within their systems and ensure that such accounts are closed immediately.”

The “ENaira” project in Nigeria is still going strong.

eNaira, Nigeria’s CBDC initiative, has completed over 40 million naira ($113,000) worth of transactions and has over 400,000 wallets registered on the network within the first two weeks of its existence, despite early problems.

Nigerian President Muhammadu Buhari said during the project’s debut that ENaira may contribute up to $29 billion to the country’s GDP over the following ten years.

While the initiative’s debut hasn’t been without bumps, Bitt Inc, CBN’s technical partner on the project, has announced intentions to build a mobile app for the country’s unbanked.

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Posted in: Banking, Africa

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