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Nigeria has unbanned all cryptocurrency transactions in the country’s banking system as the Central Bank of Nigeria (CBN) announced lifting a two year restriction over allegation that crypto was easy conduit for money laundering and terrorism funds.
RELATED: Nigeria takes top spot with 47% population actively engaged with crypto
The CBN announced the policy reversal in a ‘Circular to all Banks and other Financial Institutions Guidelines on Operations of Bank Accounts for Virtual Assets Service Providers (VASPS)’ signed by its Director in charge of Financial Policy and Regulation, Haruna Mustapha.
The circular with reference number FPR/DIR/PUB/CIR/002/003 states that the
Bank would now provide regulations for financial institutions on how to manage cryptocurrency to avoid misuse.
“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 guidance 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, 2021 on the subject.”
Despite the 2021 ban, Nigeria’s interest continue to grow and may have forced the CBN to rethink its policy.
Despite ban crypto adoption jumps
A 2023 report by CoinJournal.net shows that Nigeria takes the top spot with 47% of its population actively engaged with crypto.
“Nigeria’s outstanding 15% increase in crypto ownership over the past three years positions it as a frontrunner in cryptocurrency adoption. The substantial 47% engagement rate in 2023 signifies a pervasive enthusiasm, potentially fuelled by factors such as increased financial inclusion, economic uncertainty, and a rising interest in decentralized finance. Nigeria’s embrace of digital assets reflects a changing financial narrative within the country,” the report notes.
