Crypto currency: why cbn bans Bitcoin and other crypto currencies as


CBN bans cryptocurrency trading in Nigeria

The apex bank has warned that financial institutions who breach this directive would face severe sanctions.

The financial institution of Nigeria (CBN) has directed Deposit Money Banks (DMBs) and other financial institutions to shut accounts of persons who are using their systems for cryptocurrency trading.

A cryptocurrency may be a virtual or digital currency that appreciates or depreciates on the whims of economic process .

Trading with Bitcoin–a cryptocurrency type–has gained traction globally and in Nigeria lately; and most children are investing within the cryptocurrency world, buying and selling bitcoin and making profit for themselves.

But the apex ban is clearly not a lover of digital currencies.

In a statement signed by Bello Hassan, Director of Banking Supervision; and Musa Jimoh, Director of Payments System Management Department, the CBN said:“Further to earlier regulatory directives on the topic , the bank hereby wishes to remind regulated institutions that dealing in crypto currencies or facilitating payments for cryptocurrency exchange is prohibited.

“Accordingly, all DMBs, NBFIs and OFIs are directed to spot persons and/or entities transacting in or operating crypto currency exchanges within their systems and make sure that such accounts are closed immediately.”

The CBN also declared that breaches of its directive will attract severe regulatory sanctions.

CBN has never liked cryptocurrency

It is not the primary time that the CBN would be showing its disdain for cryptocurrency. In 2018, the apex bank issued a circular to mention cryptocurrencies aren't legal tenders in Nigeria.

For the avoidance of doubt, dealers and investors in any quite cryptocurrency in Nigeria aren't protected by law. Virtual currencies are traded in exchange platforms that are unregulated, everywhere the planet .

“Consumers may therefore lose their money with none legal redress within the event these exchangers collapse or close business.

“Members of the general public are hereby warned that virtual currencies aren't tender in Nigeria. Accordingly, we wish to caution all and varied on the risks inherent in such activities,”the 2018 statement had read.

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