Nigeria Lifts Ban on Banks Crypto Transactions

The Central Bank of Nigeria (CBN) has lifted the ban on Nigerian banks facilitating cryptocurrency transactions, Cointelegraph reported, citing a circular sent to banks on Dec. 22. The central bank enforced the ban two years ago.

Now, the CBN finds that rising global crypto demand and adoption make maintaining the stringent restrictions imposed on banks in 2021 unjustified.

However, central bank representatives expressed the opinion that there is still a global need to regulate the activities of virtual assets service providers (VASPs), which include crypto.

The central bank’s guidelines aim to set basic standards and requirements to establish banking relationships and open accounts for VASPs in Nigeria. They have the additional goal of ensuring solid risk management practices within the finance industry regarding licensed VASPs’ activities.

However, banks still aren’t allowed to hold, trading or conducting crypto transactions via their own accounts.

In related news, the Nigerian blockchain industry called on the federal government to enforce laws to support the widespread integration of Nigerian blockchain policy. Obinna Iwuno, the president of the Stakeholders in Blockchain Association of Nigeria (SiBAN), pointed out that there was a need to establish a regulatory frameworkto implement blockchain technology into various economic sectors more quickly. Iwuno told Cointelegraph:

We are ready for full adoption now, and the blockchain policy initiated by the government positions Nigeria as a trailblazer in the continent’s digital economy landscape if fully implemented.

In related news, Nigerian banks are cooperating to create and monitor the cNGN, a new stablecoin designed to benefit the economy in general as well as its individual holders.

According to anonymous sources, the cNGN token is pegged to and backed by Nigeria’s fiat currency, the naira. The stablecoin project is another sign that the country’s government is opening up to cryptocurrency.