CBN directs banks, OFIs, NBFIs to close all cryptocurrency accounts, transactions

*The Central Bank of Nigeria has directed banks and other financial institutions in the country to identify persons and/or entities transacting in or operating cryptocurrency exchanges within their system and close such accounts immediately

Isola Moses | ConsumerConnect

While re-emphasising that dealing in cryptocurrencies, or facilitating payment from cryptocurrency exchanges is prohibited in the country, the Central Bank of Nigeria (CBN) has directed Deposit Money Banks (DMBs), Other Financial Institutions (OFIs) and Non-Bank Financial Institutions (NBFIs) against having any transactions in crypto or facilitating payments for crypto exchanges.

The Bankers’ Bank in a letter dated February 5, 2021, gave this directive this to all DMBs, OFIs and NBFIs in the country.

Bello Hassan, Director of Banking Supervision, and Musa Jimoh, Director of Payments System Management Department of the CBN, who jointly signed the letter stated: “The CBN circular of January 12, 2017 Ref FPR/DIR/GEN/CIR/06/010 which cautioned DMBs, NBFIs and OFIs and members of the public on the risks associated with transactions in crypto currency refers.”

The CBN noted that “breaches of this directive will attract severe regulatory sanctions.”

It stated: “Further to other regulatory directive on the subject, the bank hereby wishes to remind regulated institutions that dealing in crypto currencies or facilitating payment from cryptocurrency exchanges is prohibited.”

The Director of Banking Supervision added: “Accordingly, or DMBs, NBFIs and OFIs are advised to identify persons and/or entities transacting in or operating crypto currency exchanges within their system and ensure that such accounts are closed immediately.”

ConsumerConnect earlier Friday reported although some investment experts have maintained that cryptocurrency is both confusing and alluring to most consumers, Visa is currently planning to develop a suite of software applications so that banks can enable cryptocurrency trading and allow consumers to purchase and sell Bitcoin and other cryptocurrencies at conventional banks.

Visa stated it would be partnering with South Dakota startup Anchorage Trust Company, which recently became the first cryptocurrency company to receive a Federal charter from the Office of the Comptroller of the Currency in the United States (US).

Anchorage will act as the “digital custodian” of cryptocurrencies purchased at Visa’s banking partners, report noted.

Al Kelly, Chief Executive of Visa, has described Bitcoin as “digital gold”, stating that cryptocurrencies are “not used as a form of payment in a significant way at this point.”

Kelly said: “Our strategy here is to work with wallets and exchanges to enable users to purchase these currencies using their Visa credentials or to cash out onto our Visa credential to make a fiat purchase at any of the 70 million merchants where Visa is accepted globally.”