Nigeria's Central Bank Unlocks Crypto Potential. 🇳🇬🪙
Central Bank of Nigeria (CBN) has officially lifted its ban on cryptocurrency transactions, reshaping the nation's financial landscape. Haruna Mustafa, Director of the Financial Policy and Regulation Department, announced this transformative decision, highlighting Nigeria's commitment to adapting to global financial trends.
Regulation of VASPs:
The CBN aligns with global trends by emphasizing the regulation of Virtual Assets Service Providers (VASPs), including cryptocurrencies. This move addresses concerns like money laundering and terrorism financing, in accordance with Financial Action Task Force (FATF) recommendations.
New Guidelines for Banking Activities:
Fresh guidelines have been issued to regulate banking activities related to VASPs. Section 30 of the Money Laundering Act of 2022 officially recognizes VASPs as part of the financial institution definition. Immediate compliance is stressed for all banks and financial institutions in Nigeria.
Prohibition on Direct Crypto Transactions:
While lifting the ban enables banking transactions with VASPs, the CBN prohibits banks from holding, trading, or transacting virtual currencies on their own accounts. This nuanced approach showcases Nigeria's openness to the digital currency wave while exercising caution to mitigate potential risks.
The CBN's groundbreaking policy shift marks a transformative chapter in Nigeria's financial history. It signifies the country's readiness to embrace evolving global financial trends while vigilantly managing potential risks associated with the crypto space. Nigeria has positioned itself at the forefront of financial innovation, signaling a promising future for its digital economy.
