Cryptocurrency Ban: We are in Nigerians’ best interest— CBN Gov. Emefiele

Godwin Emefiele, governor of the Central Bank of Nigeria (CBN), says the apex bank’s directive to financial institutions on cryptocurrency transactions, is in the best interest of depositors and the country’s financial system.

Emefiele said this on Tuesday, while briefing a joint senate committee on banking, insurance and other financial institutions; ICT and cybercrime; and capital market.

On February 5, CBN had directed all banks in Nigeria to close account of persons or entities involved in cryptocurrency transactions within their systems.

Emefiele 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.

He declared that “Cryptocurrency is not legitimate money” because it is not created or backed by any Central Bank.

“Let me state that this decision is in the best interest of every well meaning Nigerian, who have nothing to hide and is happy to have traceable and transparent dealings in our financial system,” Emefiele said.

“Cryptocurrency is used to describe the activities of traders in an electronic dark world where transactions are extremely opaque, not visible and not transparent. These are people who deal in transactions that do not want to be trailed.”

He said CBN knows that a continuation of the transaction significantly threatens the safety and soundness of Nigeria’s collection system.

“CBN has a major and primary responsibility as a primary regulator to protect activities of actors, bank stakeholders and uninformed actors in the financial system from other actors who may wish to take advantage of their lack or limited knowledge to rip off the uninformed.

“And that is the reason we have banned all banks to desist from operating accounts for cryptocurrency dealers in Nigeria.