CBN Lifts Ban on Cryptocurrency Transactions in the Country

The Central Bank of Nigeria (CBN) has lifted the ban on cryptocurrency transactions in the country.

The apex bank in February 2021 has ordered all financial institutions in the country, including banks to shut accounts of citizens or entities involved in cryptocurrency transactions within their systems.

The CBN had earlier warned that digital currencies such as Bitcoin, Litecoin, and others are largely used in terrorism financing and money laundering.

However, in a circular dated December 22, 2023, and signed by its director of financial policy and regulation, Haruna Mustafa, the CBN asked banks to disregard its earlier ban on crypto transactions in the country.

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Following this development, the Financial Action Task Force (FATF) also updated its recommendation to require VASPs to be regulated, to prevent misuse of virtual assets.

In view of the foregoing, the CBN hereby issues this guidelines to provide guidiance to financial institutions under its regulatory purview in respect of their relationship with VASPs in Nigeria.

The guidelines supersedes the CBN circular of Feb. 5, 2021on the subject, the director said.

He, however, warned that banks and other financial institutions were still prohibited from holding, trading or transacting in cryptocurrencies on their own account.