CBN Lifts Ban On Crypto Transactions After 3 Years. The Central Bank of Nigeria (CBN), which had prohibited banks from operating accounts for crypto-currency service providers and users for almost three years, has now lifted the prohibition while keeping restrictions on financial institutions’ ability to transact virtual assets directly in place.
Thank you for reading this post, don't forget to subscribe!The CBN said it has released a guideline to give guidance to financial institutions under its regulatory purview regarding their banking relationship with Virtual Assets Service Providers (VASPs) in Nigeria in a circular issued by Haruna Mustafa, Director, Financial Policy and Regulation department with reference number FPR/DIR/PUB/CIR/002/003.
It said, “The CBN, in February 2021 issued a circular restricting banks and other financial institutions from operating accounts for cryptocurrency service providers in view of the money laundering and terrorism financing (ML/TF) risks and vulnerabilities inherent in their operations as well as the absence of regulations and consumer protection measures.
“However, current trends globally have shown that there is a need to regulate the activities of virtual assets service providers (VASPs) which include cryptocurrencies and crypto assets. Following this development, the Financial Action Task Force (FATF) in 2018 also updated its Recommendation 15 to require VASPS to be regulated to prevent misuse of virtual assets for ML/TF/PF.
“Furthermore, Section 30 of the Money Laundering (Prevention and Prohibition) Act, 2022 recognizes VASPs as part of the definition of a financial institution.
“In addition, the Securities and Exchange Commission in May 2022 issued Rules on Issuance, Offering and Custody of Digital Assets and VASPs to provide a regulatory framework for their operations in Nigeria.
