Nigeria cautions financial institutions against crypto-currency dealing

Automobiles drive past the headquarters of the Nigerian central bank in Abuja, Nigeria, on Friday, Jan. 10, 2020. Revenue in Nigeria has fallen short of the government target by at least 45% every year since 2015, and shortfalls have been funded through increased borrowing. Photographer: KC Nwakalor/Bloomberg via Getty Images
The headquarters of the Central Bank of Nigeria is seen in the capital Abuja. (Creative Commons / Wikimedia)

Nigeria’s apex bank has warned all financial institutions in the country to desist from dealing in crypto-currencies as it is illegal.

The warning was in furtherance of a 2017 circular, which cautioned Deposit Money Banks (DMBs), Non-Bank Financial Institutions (NBFIs), other Financial Institutions (OFIs) and the public about inherent risks in such transactions, the Central Bank of Nigeria (CBN) said on Saturday in a statement made available to Xinhua in Lagos, Nigeria’s economic hub.

“CBN hereby wishes to remind regulatory institutions that dealing in crypto-currencies or facilitating payment of crypto-currency exchange is prohibited,” the bank said.

“Accordingly, all DMBs, NBFIs and OFIs are directed to identify persons transacting in or operating crypto-currencies exchange within their systems and ensure that such accounts are closed immediately,” it added.

The apex bank warned that breaches of this directive will attract “severe regulatory sanctions,” without giving further details.

A crypto-currency is a digital or virtual currency that uses cryptography and is difficult to counterfeit because of this security feature.

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