Nigerians have condemned the directive by the Central Bank of Nigeria to commercial banks and all non-banking financial institutions, banning transactions involving cryptocurrencies.
The CBN gave the directive in a statement on Friday, stressing that all the institutions should close accounts of customers with cryptocurrency transactions with immediate effect.
“The Central Bank of Nigeria’s (CBN) circular of January 12, 2017 ref: FPR/DIR/GEN/CIR/06/010 which cautioned Deposit Money Banks (DMBs), Non-Bank Financial Institutions (NBFIs), Other Financial Institutions (OFIs) and members of the public on the risk associated with transactions in cryptocurrency refers,” CBN said.
“Further to earlier regulatory directives on the subject, the bank hereby wishes to remind regulated institutions that dealing in cryptocurrencies or facilitating payments for cryptocurrency exchanges is prohibited.
“Accordingly, all DMBs, NBFIs and OFIs are directed to identify persons and/or entities transacting in or operating cryptocurrency exchanges within their systems and ensure that such accounts are closed immediately.”
The apex bank added that any breach of the directive will attract severe regulatory sanctions.
However, the development has been criticised by many Nigerians, some of whom took to social media to express their displeasure.
For instance, Senator Ben Murray Bruce criticised the apex bank’s decision, saying, “I thought it’s universal knowledge that decisions or policy regarding finance or economy should never be hasty?”
Also, human rights activist, Segun Awosanya, popularly called Segalink, described the CBN’s action as foolhardy, saying, “This is yet another developing horror story in our dying society. The govt via @cenbank is now shutting down cryptocurrency in a desperate move to block any ray of hope for the huge youth demographic they have largely failed. This won’t end well. This is ill-advised.”
Blogger, Japhet Omojuwa, said, “Individuals that can fund the entire Nigerian budget for donkey years are betting on Bitcoin but Hassan and Musa are afraid it could make Nigerians wealthy. Welcome to the Dark Age! Others are in the Age of Deep Learning. We are in The Age of Deep Poverty.”
But the decision was hailed by a former presidential aspirant, Adamu Garba, who said, “With the banning of crypto transactions, I believe the CBN is taking proactive measures to protect Nigerians from fraudsters who deceive ordinary citizens & rid them of their earnings. Crypto traders are supposed to be regularised so that they can be tracked in the event of cheats.”
In December 2020, Quartz Africa reported that Nigeria was number two in the global Bitcoin market after trading 60,215 Bitcoins in the last five years.
Nigeria moved to that spot in the market after young citizens who were barred from local payment methods by the government opted for Bitcoin to fund the October 2020 #EndSARS protests against police brutality and bad governance in the country.
DJ Switch, who partook in the #EndSARS protest, expressed her disappointment at the CBN directive, saying, “If the ban on crypto by CBN is true, it points yet again to the ill-informed, backward, poverty promoting dinosaurs T-Rex leading us. Use your time to investigate and close accounts sponsoring terrorists in the country if you don’t know what to do!”