Elaborated Statement Of Crypto Ban Imposed By Nigeria - Exclusive.

Elaborated Statement Of Crypto Ban Imposed By Nigeria - Exclusive.

2021-02-08 | Eddy Morgan

Elaborated Statement Of Crypto Ban Imposed By Nigeria - Exclusive.

The CBN [Central Bank of Nigeria] recently issued an elaborated statement on Sunday clarifying its statement on crypto assets after a regulatory warning to the native banking institutions on Friday. According to the official statement, the CBN added on Friday’s letter was solely a reminder that cryptocurrencies weren't a legal tender in Nigeria, and was reiterating an edge the bank has held since 2017, not imposing new restrictions on the industry.
“It is vital to clarify that the CBN circular of 5th Feb 2021 didn't place any new restrictions on cryptocurrencies, as long as all banks within the country had earlier been forbidden, through CBN’s circular dated 12th January 2017, to not use, hold, trade and/or transact in crypto assets,” the statement explained.
The CBN sent a letter to the native financial institutions earlier on Friday, ordering them to pack up all bank accounts related to cryptocurrency trading platforms. In response to the letter, cryptocurrency trading platform Binance and native electronic payment apps like Bundle halted deposits. Angered Nigerian cryptocurrency users took to Twitter and other social media platforms to precise their displeasure. As per the official statement, signed by Osita Nwanisobi, Ag. director of Corporate Communications goes on to list other countries that have also banned its banks from dealing in crypto-assets and makes the claim that in China, “cryptocurrencies are completely banned and every exchange within the country was also closed.” While China has imposed a variety of new restrictions on cryptocurrency exchanges and their users, it's not outright banned crypto assets entirely. It also added that cryptocurrencies are issued by “unregulated and unlicensed” entities, which cryptocurrencies are volatile speculative assets and will pose a risk to Nigerian users.
“The very name and nature of ‘cryptocurrencies’ suggest that its patrons and users value anonymity, obscurity, and money laundering,” the statement added.
Within the letter, the CBN assured that this stance won't inhibit the progress of the fintech sector within the country or its payments ecosystems. The directive became necessary, it revealed, to guard Nigerians, including its youths from the risks inherent in cryptocurrencies-associated transactions.
“Due to the very fact that cryptocurrencies are largely speculative, anonymous and untraceable they're increasingly getting used for laundering, terrorism funding along with several other criminal activities,” the statement added.
The letter also explained that the high volatility inherent in cryptocurrencies posed a major threat to “small retail and unsophisticated investors” who stand to lose tons.
“In light of those realities and analyses, the CBN has no comfort in crypto assets at this point. It'll still do all within its regulatory powers to teach Nigerians to desist from its use and ensure safety to our economic system from activities of fraudsters and speculators,” the statement adds.
The Official CBN's Report States As follows

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