CBN, others defend cryptocurrency stance

Governor of the Central Bank of Nigeria (CBN), Mr Godwin Emefiele has insisted the Bank’s decision to prohibit deposit money banks, non-banking institutions and other financial institutions from facilitating trading and dealings in cryptocurrency is in the best interest of Nigerian.

Emefiele made the assertion on Tuesday, while briefing a joint Senate Committee on Banking, Insurance and Other Financial Institutions; ICT and Cybercrime; and Capital Market, on its directive to institutions under its regulation.

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Emefiele also insisted that the operations of cryptocurrencies are dangerous and opaque adding that the use of cryptocurrency contravened an existing law.

He said given the fact that cryptocurrencies were issued by unregulated and unlicensed entities made it contrary to the mandate of the Bank, as enshrined in the CBN Act (2007) declaring the Bank as the issuer of legal tender in Nigeria.

“Cryptocurrency has no place in our monetary system at this time and cryptocurrency transactions should not be carried out through the Nigerian banking system,” he added.

The Director-General of the Securities and Exchange Commission (SEC), Mr Lamido Yuguda at the event clarified that there was no policy contradiction between the CBN directive and that of SEC on cryptocurrency.

Equally, the Independent Corrupt Practices and Other Related Commission (ICPC) and Nigerian Financial Intelligence Unit (NFIU) have backed the decision of the Central Bank of Nigeria to ban cryptocurrency use in Nigeria.

Chairman of ICPC, Bolaji Owasanoye, said the #EndSARS protest was largely financed by cryptocurrency, indicating that it could be used to fund insurgency.

The NFIU boss, Tukur Moddibo also said cryptocurrency failed the critical tests of vulnerability and attendant risks, noting that his agency averted a $3 million fraud linked to 20 bank accounts.