TL;DR Breakdown
- Central bank of Nigeria directs that accounts of crypto trades be closed.
- Orders closure in lieu to ban on cryptocurrencies in Feburary.
- CBN gov says crypto ban is to protect citizens.
The Central Bank of Nigeria has again ordered that bank accounts of certain individuals purportedly into trading cryptocurrencies be frozen by commercial banks in the country.
Local report in the country (Peoples Gazette) reports that the order was contained in a Post-No-Debit circular signed on November 3 by the Director of Banking Supervision, J. Y. Mammanand, addressed to commercial banks.
“You are hereby directed to close accounts of the underlisted bank customers and place the funds in the accounts in suspense accounts for engaging in cryptocurrency trading in contravention of CBN Circular BSD/DIR/PUB/014/001 dated February 5, 2021,” Peoples Gazzete quoted the circular.
The listed accounts belong to two individuals, Nnamdi Francis Okereke and Nwaorgu Kingsley Chibuzor, and a company called TVS Hallmark Service Limited.
Central Bank of Nigeria crypto ban in February
The Apex bank in Nigeria placed a ban on cryptocurrencies. The bank stopped banks from servicing crypto exchanges in the country, citing concerns including volatility, money laundering, and the financing of terrorism.
Governor of the Central Bank of Nigeria, Governor Godwin Emefiele, said that most of the crypto transactions processed through banks in Nigeria were illegal and used to fund illicit activities.
Emefiele held that the value of Bitcoin is derived from thin air. He said the ban was necessary to protect citizens from the risks of trading cryptocurrency. He added that as an unregulated market, there is no legal redress should things go wrong.
Towards enforcing the ban, the bank directed that bank accounts of some hodlers be frozen. The value of funded accounts is highlighted by such cases which can affect individuals or companies.
However, despite the ban on banks and other anti-crypto moves by the central bank of Nigeria, the country’s crypto market continues to emerge as one of the biggest in Africa. In August, Nigeria had the second-largest market for peer-to-peer bitcoin (BTC) trading.
