In what could come as a major boost for the Nigerian crypto sector, that was earlier grappled by various restrictions, the Central Bank of Nigeria (CBN), in its latest move, has now lifted the ban imposed in February 2021 which had earlier restrained financial institutions from operating accounts for any cryptocurrency related service providers. Sending a clear signal for the crypto sector to flourish, the recently issued December 22 circular to Nigerian Banks/financial institutions defining stringent know-your-customer (KYC) and Anti Money-Laundering police, now allows them to facilitate the conduct of banking activities pertaining to Virtual Asset Service Providers (VASPs).
The ban back in 2020, intended to prevent the risk of unscrupulous utilisation of bitcoin and related financial assets as well as to actively deter criminal activities such as money laundering and terrorism being funded, had had a great disruptive impact on this recently burgeoning investment sector – similar to attempts witnessed globally, where the lawmakers are striving scrutinize and balance, the prospects of crypto assets along with its associated risks of financial crimes.
As banking activities are now licenced for these financial institutions bringing Transformative Changes to the digital market economy, deploying resources not to be used in the trading of digital assets but essentially, primarily, helping VASPs to quickly foresee transactions, courtisoring and abiding customer rights and conforming to anti-fraud and laundering standards.
Web3 software company Consensys referral research outcome had shown that out of Nigerian citizens, 99% GDP had gotten to hear of Cryptocurrencies, with 91% of the same population willingly readily to invest, bringing an elevated positive spillover of these developments.
Simultaneously along with its progressive cryptographic policy rulings, the Nigerian Federal Ministry of Communications and Digital Economy (FMCDE) had validated the National Blockhain Policy in 2021, for aspiring to launch subversive indust localized projects, while affirming safety with respect to blockchain technology begins used across the country.
Although banks and other related regulated financial intuitions have been allowed to set up designatedDW accounts for CRPs’, banks are still prohibited from Holding, transacting or trading prone to source accelerated volatility of Crypto Currencies.
